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The $10k BYD Seagull EV is scaring the U.S. auto industry
- oldpersonintx 3y ago[dead]
- tw04 3y agoAs it should, just like the dirt cheap solar panels from China scared US suppliers and drove all of them out of business. When the government subsidizes product to the point of it being significantly below market cost in order to capture market share, the folks who can't do the same lose. See: Amazon and small bookstores.
- Arnt 3y agoThat car is small, light, has few moving parts, no luxury parts, and the most expensive part is dropping quickly in price. It clearly is below market cost, since it sets a new price record. But subsidized? What makes you think it's subsidized?
- pixelatedindex 3y agoI’m guessing the Chinese government bears some of this cost, particularly R&D. Even the article mentioned the government subsidizing cost. Unless you don’t believe that.
- Arnt 3y agoThe word subsidy is used to cover quite different things, At one end, people use the word "subsidy" about tax rules that apply to everyone, and at the other, things that I too consider to be subsidies.
- mooreds 3y agohttps://www.ifw-kiel.de/fileadmin/Dateiverwaltung/IfW-Publications/fis-import/bc6aff38-abfc-424a-b631-6d789e992cf9-KPB173_en.pdf https://www.ifw-kiel.de/fileadmin/Dateiverwaltung/IfW-Public... Is an EU commissioned study. According to Bloomberg, it says BVD got billions of euros: https://www.bloomberg.com/news/articles/2024-04-10/byd-got-3-4-billion-chinese-aid-to-dominate-evs-study-says https://www.bloomberg.com/news/articles/2024-04-10/byd-got-3...
- ninetyninenine 3y agoThe article says it’s subsidized. The reality is if it is at all subsidized it’s incredibly minor. Subsidizing things to such an extent is a huge drain on any government and has dire consequences. He’s not wrong there’s a lot to fear he’s just too afraid to say exactly what it is. China in many areas is surpassing the US in technological superiority, capability and cost. The country is viciously fighting for intellectual and economic dominance based not on cheap tricks like subsidization or tariffs but through actual superior capability. Such a future is one realistic possibility out of many and it’s not just for cars. War between the two countries instigated by the US to maintain technological superiority is a possibility but very unlikely. If it happens there will likely be an excuse like human rights or defending Taiwan. There is little fear for this because likely the instigator for war will be the west. The west in a certain way wants war a bit more than the east. Everything you see in this thread and outside of this fear is an excuse. This is the true thing that Americans fear. They fear it so much that they can’t even fully admit it. Instead most people lie to them selves. It’s a form of patriotism that colors most people’s biases.
- hangonhn 3y agoI wrote a similar comment about this on a different post. They're unlikely to still be subsidized (or if it is it is small) but their subsidies did happen. China's industrial policy play book goes like this: 1. Erect barriers to foreign competitors. Subsidize domestic makers. This creates a chaotic fields of many domestic players that aren't particularly good nor efficient. 2. Remove or reduce subsidies and force the domestic players to fight for survival and thus innovate. The weaker ones will die off or get absorbed until there are only a few major domestic makers. 3. Lower barriers to foreign competitors (ie. invite Tesla to build a factory in Shanghai) to really ratchet up the competition and force innovation even more 4. Start exporting It's not traditional subsidies but that early governmental incubation phase was a huge help in companies building up their infrastructure (subsidized by government) and know how. Also, I want to point out this isn't an exclusively Chinese playbook but one that has been used by Japan and South Korea as well. The origin actually goes all the way back to Germany during their industrialization. The US doesn't do this because of our strong adherence to free market capitalism but people, even GOP Senator Rubio, is starting to reconsider this position.
- wing-_-nuts 3y agoTBH, if china wants to subsidize the production of green tech, more power too them. Maybe it'll start a green trade war with every country putting more and more money behind green tech. When it becomes ubiquitous, then we can start worrying about fairness. US automakers had ample opportunity to be leaders in this space and completely neglected it. Now they face the consequences of that decision.
- paxys 3y agoAffordable small cars have never been a thing in the US, electric or not. There's zero reason to believe that this new batch will pose a threat.
- GenerWork 3y agoThe original VW Beetle begs to differ.
- bonzini 3y agoAfter 40 years of marketing for pickup trucks (that let manufacturers skirt emission regulations)?
- foobarian 3y agoShould be safe to allow imports then, right? Since nobody but me would buy one. :-)
- paxys 3y agoWho says imports aren't allowed?
- 4pkjai 3y agoThey are allowed, but the US has a 27.5% tarrif on Chinese EVs.
- autoexecbat 3y ago$13k instead of $10k is still great for a tiny car!
- boringg 3y agoUS protectionism would like a word with you.
- 3y ago
- GenerWork 3y agoWould BYD even be able to sell it here for $10k? Pretty sure Trump slapped a bunch of tariffs on Chinese vehicles, and Biden may have hiked those tariffs. To me, the logical step is for Chinese vehicles to build factories in Mexico and then ship vehicles into the country so they qualify as NAFTA vehicles. No way will it be $10k, but it certainly won't be $40k like other electric vehicles.
- Dig1t 3y agoYes totally, but it's still scary knowing that the only thing standing between you and destruction is a political policy. Also: if you consider climate change to be an end-of-the-world catastrophe, then it's pretty easy to make an argument to consider changing the tariffs at some point.
- papercrane 3y agoThey're already looking to enter the Mexican market. Publicly they say this is to supply the Mexican market, and not export to the USA. It will be interesting to see if/when that changes. https://www.reuters.com/business/autos-transportation/chinese-carmaker-byd-launches-low-cost-dolphin-mini-ev-mexico-2024-02-28/ https://www.reuters.com/business/autos-transportation/chines...
- hangonhn 3y ago> To me, the logical step is for Chinese vehicles to build factories in Mexico and then ship vehicles into the country so they qualify as NAFTA vehicles. No way will it be $10k, but it certainly won't be $40k like other electric vehicles. I wouldn't be so sure it won't be $10k. The cost of labor in China has been going up for a while now. China's strength in the EV market comes from their near monopoly on the supply chain. What a lot of Chinese companies have been doing is to do most of the manufacturing in China and ship the major components off for final assembly in other countries like Vietnam and Philippines. I don't see why the same thing can't happen in Mexico. In fact, a lot of manufacturing in Mexico is precisely of the final assembly sort to take advantage of NAFTA.
- AtlasBarfed 3y ago
- nothercastle 3y agoNobody in the USA wants that market. There isn’t even an interest in under 25k cars. I don’t see any issues allowing these if local manufacturers aren’t even willing to make products at 2x the price
- JumpCrisscross 3y ago> Nobody in the USA wants that market. There isn’t even an interest in under 25k cars That doesn’t mean the market doesn’t exist. I could see these being sold in Mexico and Europe. At that point, the American car industry becomes an inefficient protected industry. American voters have limited sympathy for those in the long run when it comes to consumer goods. That said, it’s unclear if BYD can make a $10k car that meets American safety (and useless regulatory) standards.
- nothercastle 3y agoI mean from the manufacturer point of view, under 50k cars aren’t sufficiently profitable to be worth making. So very little R&D happens at the low end
- JumpCrisscross 3y ago> under 50k cars aren’t sufficiently profitable to be worth making. So very little R&D happens at the low end The fact that both new entrants and legacy manufacturers are struggling with that production cost implies there is a structural cause for those high prices. I’m sceptical BYD can sell a car in America for $10k. I’m less sceptical that anyone else cares about the mandates that make American cars expensive.
- OtherShrezzing 3y ago>At that point, the American car industry becomes an inefficient protected industry. American voters have limited sympathy for those in the long run when it comes to consumer goods. Do they have little sympathy? The list of protected American industries is enormous, and has been for nearly a century. Tobacco, corn, vehicles, aerospace, the energy industry, oil & gas industry. I could write out a list as long as my arm.
- cypress66 3y agoIt should worry the EU industry more. People in the US don't buy city or compact cars. They buy bigger and more premium ones.
- Mencius- 3y ago[flagged]
- devmor 3y agoI hope so. The price of EVs in the US market is ludicrously overinflated. It's understandable for new startups like Rivian, Lucid and co, but in the case of existing auto manufacturers, early adopters are subsidizing the cost of redeveloping tooling that should have been easily covered by nearly a century of profit leeched away by shareholders. GM, Ford and Stellantis should have been able to produce a sub-$20k EV by now, and none of their offerings should have ever been more expensive than a comparable trim ICE vehicle.
- pixelatedindex 3y ago> The price of EVs in the US market is ludicrously overinflated Maybe so, but the labor unions and general cost of doing business is higher in the US. But I think the major cost here is the batteries and charging tech. BYD is ahead on both these things - they were a battery company first, car manufacturer second. Their CEO is also very astute.
- devmor 3y ago>Maybe so, but the labor unions and general cost of doing business is higher in the US. Sure, and that's understandable - but I'm making a comparison to ICE vehicles. That doesn't provide an appreciable difference there.
- cityofdelusion 3y agoSub $20k is not realistic in 2024. Even barebones ICE cars without AC and with everything cheap plastic start higher and return no margin. The last car that was widely available below $20,000 was the manual, no-ac Honda civic from the widely panned post-housing bubble model generation. Mitsubishi also sold a widely panned barebones model, their Mirage, that sold poorly. Cheap cars with no margin is a suckers bet. The auto industry carries way too much debt and can’t deliver such a product and remain in business for long.
- ProfessorLayton 3y agoA Nissan Versa starts at $16,390 [1] and has AC and power windows in the base model. $19,680 with a CVT upgrade. [1] https://www.nissanusa.com/vehicles/cars/versa-sedan.html https://www.nissanusa.com/vehicles/cars/versa-sedan.html
- boringg 3y agoEveryone being like - we don't care about cars that small. It's the equivalent at looking at LLMs two years ago and being - it can't perform anything. It's an entry point and they will get bigger and better and more attractive - to the benefit of consumers upping the competition. Kia was written off when it first came to town. US domestics should be concerned - they wrote off Tesla as well.
- seanmcdirmid 3y ago> Kia was written off when it first came to town. Hyundai/Kia were smart in that they introduced their cars with really long warranties to dispel quality concerns. However, they lost a lot of credibility recently with their cars being famous for being easy to steal via YouTube tutorials and tiktok challenges.
- boringg 3y agoMy point is that they managed a way into the market and held market share with considerable doubt against them.
- seanmcdirmid 3y agoIt is just that if you said that maybe 5 years ago, it would sound stronger than today when they are currently losing credibility at a rapid clip.
- autoexecbat 3y agoI really want a car that small - as the family's second car
- ofrzeta 3y agoIn Germany in work-related traffic (commuting I guess) there are 1.1 persons per car in average. I guess it's similar in many other countries. So a small car like this would be perfect for most commuters. I always dream of a one/two-seat vehicle for that purpose, something alike the Renault Twizy.
- 3y ago
- iambateman 3y ago"The Chinese government wants to wipe out American automakers by introducing competitively priced cars" is a PR scare tactic. It's exactly what I would say if I were a PR person trying to figure out how to protect my company's interests. Cars are imported from all over the world, and so long as they meet American safety standards, I think they should be. Also if I could buy a safe, new EV for $10,000, no matter how small, I would do it tomorrow. Just because Americans have never purchased small, affordable cars _en masse_ before doesn't mean they won't in the future.
- JumpCrisscross 3y ago> so long as they meet American safety standards, I think they should be The question is to what degree those standards were written for safety versus protectionism, and to what degree any other market cares about them.
- iambateman 3y agoI agree that that question is important but I view it as separate. I know nothing about car safety, so I have to take the recommendations on authority that they are necessary.
- vidanay 3y ago> Just because Americans have never purchased small, affordable cars _en masse_ before doesn't mean they won't in the future. I'm guessing you weren't around in the 80s?
- michaelmrose 3y agoHistorically cheap Chinese cars have done VERY poorly in crash tests. for 10K its probably a piece of plastic which folds killing the user in every crash over 35 mph. It's hard to dig up exact figures. It looks like China has around 500M drivers averaging 10,000 vehicle miles each and annual traffic fatalities of 250,000. This suggests the death rate per billion vehicle miles is about 13 in the US and about 50 in China. https://english.www.gov.cn/archive/statistics/202212/08/content_WS6391cafcc6d0a757729e41bc.html https://english.www.gov.cn/archive/statistics/202212/08/cont... https://en.wikipedia.org/wiki/List_of_countries_by_traffic-related_death_rate https://en.wikipedia.org/wiki/List_of_countries_by_traffic-r... note death rate is herein per billion vehicle km which I have converted to miles https://gitnux.org/average-annual-mileage/ https://gitnux.org/average-annual-mileage/
- jillesvangurp 3y agoThe scary thing for US car manufacturers isn't necessarily Chinese imports in the US, which import tariffs should prevent, but the notion of BYD partnering with or acquiring existing US manufacturers and then starting to produce very cheap cars inside the US. This is what the Japanese did and later other manufacturers. Fiat bought Chrysler at some point and now Stellantis (which Fiat/Chrysler merged into) is producing lots of traditional US car brands in the US. The notion that EVs are now feasible at low cost is what is making car manufacturers nervous. Because these Chinese cars are 1) very good 2) much cheaper than other manufacturers would be able to deliver. There's a lot being said about subsidies. That's no excuse. The US has a 1 trillion $ IRA package. And a history of repeatedly bailing out bankrupt car manufacturers. They have and have had plenty of government support over the years. The lack of support is not the issue. In the end government support is a means to an end: figuring out how to build lots of cheap electrical vehicles. The Chinese seem to be doing quite well on that front.
- deleted 3y ago[deleted]
- tamimio 3y agoScaring them for good, how’s that a bad thing?! It derives innovation, competition, etc. and still at an affordable prices to the consumers.
- Etheryte 3y agoYou mean in the same way that these imported cars are currently piling up in ports in Europe without anyone buying them? Chinese producers rushed to buy up cargo ships since they couldn't get the shipping volume they wanted, but now that they have their ships it looks like the demand isn't really there. [0] https://www.ft.com/content/496f3bfa-9f0c-4145-9024-188572a280fd https://www.ft.com/content/496f3bfa-9f0c-4145-9024-188572a28...
- roody15 3y agoPrice point is a major factor in EV adoption. If the United States is truly looking for increased market share of EV’s then we need a lower end market. The US market is geared too much towards “luxury” and “rent” based features and subscriptions. All which maximize profit for manufactures. If the US is serious about EV adoption then we need to compete and offer better range of prices. My two cents .
- cosmicvarion 3y agoIt's the Soviet Lada all over again. It turned out, however, that Americans didn't want to just buy the cheapest car. Other things factored into what car Americans preferred such as style, status symbol, etc.
- mostrepublican 3y agoWhat a completely bullshit headline for a bullshit article. 'BYD said just last month that it has no plans to enter the U.S. auto market anytime soon' Done. There is your whole article. The US Auto industry isn't crapping it's pants worried about something that AIN'T HAPPENING and continue to keep regulations in place that make the only affordable vehicle a 3 ton megamonster super extended cab truck.
- gizmo 3y agoTo all those who dismiss the Seagull because it's small and cheap, remember one thing: making inexpensive cars is much, much, harder than making luxury cars. The lower your gross margins the fewer mistakes you can make. It's a miracle of manufacturing that cars can be made at this price point at all (yes, there are subsidies but European and American carmakers get subsidized too). BYD, NIO and Xiaomi make luxury cars too, at very attractive prices. Musk is right when he says Chinese carmakers will "pretty much demolish most other companies in the world".
- Ferret7446 3y agoBased on the general track record of Chinese manufacturing QA and Chinese EV QA, they can make a lot of mistakes just fine.
- mostrepublican 3y ago'BYD said just last month that it has no plans to enter the U.S. auto market anytime soon' No US automaker is thinking of anything like this or even losing a minute of sleep. Crank out some more 3 ton truck!
- new_user_final 3y agoWhy can't low cost car have bigger body? If the whole car cost 10k, maybe they can enlarge the body with extra 2k.
- seanmcdirmid 3y agoBigger body = higher shipping cost because bigger and heavier, also they need a bigger battery or put up with less range for the extra weight, the heavier battery itself has weight so they need even more weight still to counteract that. So maybe they'd be able to add an inch or two for 2K, then what's the point of that?
- 1970-01-01 3y ago>The introduction of cheap Chinese autos — which are so inexpensive because they are backed with the power and funding of the Chinese government — to the American market could end up being an extinction-level event for the U.S. auto sector,” the organization writes. This would never happen. The industry is too big to fail. It would get bailed out just like it did during the 2008 crisis.
- seanmcdirmid 3y agoI don't know. It seems to me that every American brand other than Tesla is pretty much a non-concern outside of pickups. We could always wind up with America car production being dominated by the Germans and Japanese along with Tesla, with Ford, GM, and Chrysler being a thing of the past. Heck, we could wind up with Chinese autos produced in the USA, because how different is Mississippi from Henan anyways?
- dbolgheroni 3y agoIn Brazil, BYD sells this car not as Seagull, but as Dolphin Mini. But, directly converting currencies, it's more like U$23.000, not U$10.000 as is being announced everywhere.
- Fire-Dragon-DoL 3y agoI find this type of car way more attractive than the bigger ones. This struck a chord too, it looks so similar to the Suzuki Swift (that the guy quotes in a video), which was my first car (and I loved it)
- thetacitman 3y agomoms don't like driving tiny cars