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China's manufacturers are going broke
- skullone 2y agoPaywall
- wslh 2y agoFix: https://archive.is/mwnRq https://archive.is/mwnRq
- klyrs 2y agohttps://archive.is/d56oU https://archive.is/d56oU
- andrewl 2y agoTheir audio version of the article is free at: https://www.economist.com/media-assets/audio/062%20Business%20-%20Chinese%20business%20_1_-db2d202c4999cbadcff6ea2215c3367b.mp3 https://www.economist.com/media-assets/audio/062%20Business%...
- lenerdenator 2y agoWell, if they want to learn from the US, they should ship their manufacturing capacity and intellectual property off to their geopolitical rival for short-term monetary gain.
- derefr 2y agoChina was actually trying to heavily establish offshoring in the Philippines—but that has seemingly dried up with the increasing South China Sea tensions.
- alephnerd 2y agoSame with India before 2020 - China used to be India's largest FDI partner before the Galwan crisis. After that, the Indian government "persuaded" Chinese players to sell off their Indian assets to Indian, Taiwanese, Korean, Japanese, and American players instead. 4 years later, the GlobalTimes - which was extremely provocative against India - has started pushing out content arguing that India should begin reopening it's economy to Chinese players.
- Gibbon1 2y agoI swear a lot of wars get started by guys like Xi who after seizing power internally try to seize power externally and it often ends really really badly for the host country. Seriously, the leader of Germany in the 1930's, Stalin, Putin, Saddam Hussein, now Xi. All seized power domestically and then couldn't help themselves when it came to neighboring countries.
- para_parolu 2y agoObviously this is heated topic, but did it ends really bad for USSR under Stalin rule (until his death)? I mean it was bad for many citizens but other areas were actually ok-ish considering war destructions. I’m not trying to make point about Stalin. Just trying to find if this is really a rule, but my historical knowledge is pretty limited. Intuitively I feel any overpowered political entity end up like shit. But interesting to see real data.
- hkpack 2y agoOf course it was bad. But the point was about starting wars. Stalin did start many wars, disastrous invasion of Finland, invasion of Poland, Molotov-Ribentrop pact with Germany and so on.
- Gibbon1 2y agoYou could imagine an alternate universe where Stalin gets dysentery and dies. The USSR tells Ribentrop to f'off. And then joins the allies declaring war on Germany when Hitler invades Poland. Also I forgot to add Mussolini and his designs on Greece, Balkans, North and the Horn of Africa.
- petre 2y agoIf you ask the Russians the Brezhnyev rule was the best (stability, stagnation), with Stalin trailing him (won WW2, rapid industrialization). If you ask westeners, Khrushchev (space race, reforms) and Gorbachev (glasnost). https://en.m.wikipedia.org/wiki/Legacy_of_Leonid_Brezhnev https://en.m.wikipedia.org/wiki/Legacy_of_Leonid_Brezhnev
- marcosdumay 2y agoLooks like militarism and imperialism are not compatible at that crazy new 21th century world. IMO, that's a good development. I hope it lasts.
- ein0p 2y agoUh, and what would that mean for the United States? China hasn’t been at war with anyone for decades.
- daliusd 2y agoMilitarism and imperialism is not about wars only
- ein0p 2y ago[flagged]
- marcosdumay 2y agoThe countries you keep invading are not your key economical partners.
- BobbyJo 2y agoConfused about what point you're attempting to make here? Political conflict with a trade partner obviously leads to reduced trade, no matter the parties involved. What part of that statement are you taking issue with?
- ein0p 2y ago> Looks like militarism and imperialism are not compatible at that crazy new 21th century world Your faux confusion isn't really impressing anyone. Is the US, the most militarist and imperialist nation in the world by far at the moment, "compatible" with the "crazy new 21st century world"? I've also yet to see any practical examples of Chinese militarism or imperialism. I keep hearing that it's going to start happening any day now, but then it never does. What I do see is the hegemon (the US) trying to take down a rising superpower via economic warfare, and by creating instability in the region - a typical behavior of a militarist and imperialist nation.
- petre 2y agoGood luck with that. The Philippines has aligned with the US for some time and water gunning their fishermen doesn't help either. They should try to outsource to their colonies in Central Asia instead.
- fspeech 2y agoI've never sensed any real desire for China to offshore to the Philippines, given its military alliance with the US. Maybe they dangle the prospect from time to time to try to pry the Philippines away. They have much friendlier targets in Southeast Asia, with Thailand and Malaysia at the top of the list.
- aragonite 2y agoNot only that, but the Philippines has a tiny manufacturing sector compared to other major SEA economies. [1][2] I wonder if grandparent was thinking of a different country. [1] > In 2021, the economic mix of the Philippine economy was approximately 61% services, 17.6% manufacturing, and 10.1% agriculture. (https://www.trade.gov/country-commercial-guides/philippines-market-overview https://www.trade.gov/country-commercial-guides/philippines-...) [2] https://en.m.wikipedia.org/wiki/Call_center_industry_in_the_Philippines https://en.m.wikipedia.org/wiki/Call_center_industry_in_the_...
- derefr 2y ago> I wonder if grandparent was thinking of a different country Nope! I was speaking of offshoring mostly in the services industry, not the manufacturing industry[1]. Things like call centers (as you linked.) Chinese companies like BBK use Philippines call centres to serve customers in English-language markets. Which isn't at-all uncommon—the US does the same thing—but China hadn't been doing much offshoring of any kind until the last decade, and the little they have done has focused almost solely onto the Philippines. There's also something that you might not exactly call "offshoring", but it's a related idea. It's a combination of "exclave-building" and "foreign investment": Chinese companies responding to increasing levels of Chinese tourism in the Philippines by buying up Filipino companies (most visibly in the hospitality industry, but also everywhere from construction to finance) and modifying those companies to cater more to Chinese-audience interests; then, within China, promoting tourism to the Philippines — and specifically to those cities they've built up a presence within — to increase ROI on those investments. From a Filipino perspective, this was kind of a virtuous cycle, as it resulted in a lot of money being pumped into their economy. But this too has now sharply declined. --- [1] But why hasn't China begun to outsource manufacturing yet? AFAIK, it's because the Chinese manufacturing sector has so much inertia — so much built up talent, so much invested CapEx, so many local partner relationships, so many achieved efficiencies of scale — that even if domestic labor prices seriously rise within China, it'll take a long time before companies are willing to bite the bullet and invest in moving any of that. And it's also a bit of a chicken-and-egg problem: if you first offshore some middle step of manufacturing, the rest of the manufacturing process would still be cheapest for you [with your existing China-based processes] to continue to do in China; so now you'll have to ship raw goods out to the offshoring country, and then bring processed goods back into China for finishing. And during that, you'll be in competition with "full-pipeline Chinese" companies that aren't bothering to do that. IMHO I'd mostly only expect China to offshore steps that either exist at the beginning or end of a manufacturing process. Especially origination of raw goods, e.g. mining. Which would seemingly be the long-term goal of China's infrastructure investments in various African countries.
- philipov 2y agoThose places are Vietnam and Africa, and it's already happening.
- rmbyrro 2y agoVietnam and Africa are not their geopolitical rivals.
- almost_usual 2y agoNor was China when the US began offshoring.
- lenerdenator 2y agoVietnam and China have never been any more than allies of absolute convenience. In fact, in one of the weirder turns of recent geopolitical history, the Vietnamese would prefer to be American allies over Chinese if forced to choose, and it's not even close. [1]https://www.reddit.com/r/VietNam/comments/1c22j7l/vietnam_strongly_prefers_to_ally_with_usa_over/#lightbox https://www.reddit.com/r/VietNam/comments/1c22j7l/vietnam_st...
- alephnerd 2y agoIn VN, Chinese manufacturers tend to compete directly with SK and JP FDI, so the RoI isn't too hot, and Chinese manufacturers face the same hurdles American manufacturers faced when entering China (eg. Forced JVs, ToTs, etc)
- limit499karma 2y agoIt wasn't just US. The hidden politburo of capitalists decided and the nations followed orders.
- wildrhythms 2y agoNothing hidden about it.
- limit499karma 2y agoIt is not officially a recognized politburo. The Eastern approach to these top down systems is to have a overt power structure whereas such a structure is denied in the West even though as you say it is all in the open.
- throwawaycar 2y ago[dead]
- kibwen 2y agoThe CCP's current manufacturing policy is analogous to the modern venture capitalist approach of "subsidize the product until your competitors go broke, then reap the fruits of having a captive market by the balls", except the fruits have gone from "the power to set prices as a monopoly and extract a massive amount of profit" to "massive geopolitical leverage against countries that are dependent on your exports". It's a risky strategy because it's trivially countered by protectionist policies, but that depends on countries voluntarily refusing the free money that China is doing its best to shovel into your pockets. In other words, it's a bet that China's rivals cannot successfully resist short-term greed despite the huge and transparent long-term risks.
- Johanx64 2y ago> it's trivially countered by protectionist policies This assumes your local manufacturing and supply chains aren't completely demolished, expertise hasn't died out and been replaced and you can just restart it "trivially" overnight by slapping an import tariff
- oldpersonintx 2y ago[dead]
- kwhitefoot 2y ago> China’s solar industry is also grappling with oversupply. This year the prices of most components of solar modules have fallen below their average production cost. This should surely be regarded as an opportunity to install solar panels at low cost while stocks and production capacity still exist.
- pstrateman 2y agoThe panels themselves have been an insignificant parr of the total cost for a while. Mounts, connectors, wires, and inverters end up costing much more than the panels.
- kwhitefoot 2y agoIf the profit margin is 10% then a 10% reduction in total material and labour cost more than doubles your profit margin if you keep your prices the same. So how small a part of the total is the module cost? Even if you can only save 5% you still make more than 50% extra profit.
- chongli 2y agoThe price per watt for rooftop PV system installations varies dramatically from country to country in the west. Where I live in Canada the average cost is about $2 USD per watt installed (for a 7-10kW system). In Australia, the same system costs about $0.66 USD per watt installed. That means for a 10kW system I'm looking at $20k USD in Canada vs. $6600 USD in Australia. That's such a huge difference that 5-10% cost reduction in Canada would barely make a difference at all. I have serious doubts that any Canadian household could recoup the cost of a big solar install over the lifetime of the panels vs simply investing that money in ETFs. Perhaps the situation is different in the US?
- kwhitefoot 2y agoIt might not make a difference to the end user but the installer would still make a more profit. Also I doubt that you can compare Australian and Canadian installations that easily. Most of Australia is a lot closer to the equator meaning that the same panel will have a higher average output there than in Canada. Anyway, I'm not in the US. My question was a general one about taking advantage of these economic troubles, treating them as an opportunity for someone to make a profit rather than simply regarding them as a problem for everyone. The Canadian price seems a bit high, comparable with high cost Norway (where I live). The online calculator I have just checked is offering a 6.5 kWp system for about 10 kUSD, so your 20 kUSD would buy 13 kWp. I know why it's expensive in Norway, skilled manual labour costs are high, is that the same in Canada? It's similarly difficult to justify though. At the sorts of electricity prices we had in Norway before 2022 it would take 20 years to pay back but if the trend to increasing rices continues that could fall to as little as 7 years.
- djfobbz 2y agoI live in China, and what I see is quite the opposite.
- LoFiSamurai 2y agoGo on
- laksdh 2y ago[flagged]
- gopher_space 2y agoI live in a coastal blue state in the US and would think the entire country ran this well if I didn’t have the internet.
- peepeepoopoo81 2y ago[flagged]
- mensetmanusman 2y ago[flagged]
- saddat 2y agoIn machinery industry it’s absolutely the same situation as in article
- tlx42 2y agoI live near China, Vietnam, and see quite the opposite too.
- jncfhnb 2y ago> Hengchi, an electric-vehicle (ev) maker owned by Evergrande, a failed property developer, told investors that two of its subsidiaries had been forced into bankruptcy. The group originally aimed to sell 1m evs a year by 2025; amid feverish competition it sold just 1,389 last year. When you miss sales targets by 99.9% it’s got to be more than a competition problem
- alephnerd 2y ago> When you miss sales targets by 99.9% it’s got to be more than a competition problem It's fairly common across the EV industry in China. BYD is an amazing product and makes good cars. The other manufacturers not so much, as is reflected in Chinese EV car sales [0]. That's why manufacturers like SAIC (MG Motors), GAG (Wuling Motors), etc have resorted to trying to export abroad because they cannot beat BYD domestically, but this faces hurdles as most other major markets abroad (VN, JP, SK, ID, IN, Brazil, EU, MX, etc) place tariffs on autumotiive exports, forcing Chinese manufacturers to either open entire factories abroad with JVs or quit those markets Every factory SAIC, GAG, GAC, etc opens with a foreign JV is an equivalent set of jobs and IP lost in China. [0] - https://autovista24.autovistagroup.com/news/big-boost-chinese-ev-market-as-byd-maintains-command-may/ https://autovista24.autovistagroup.com/news/big-boost-chines...
- petre 2y agoThere are also Nios, Geely and Roewe on the streets of Shanghai. https://news.ycombinator.com/item?id=41207048 https://news.ycombinator.com/item?id=41207048 BYD is building an EV plant in Turkye for $1bn. https://electrek.co/2024/07/08/byd-building-huge-1-billion-ev-plant-turkey/ https://electrek.co/2024/07/08/byd-building-huge-1-billion-e...
- mayama 2y agoIt has to do with govt subsidy policy on making EVs that ended couple of years ago. Before that, every company with cash and even local govts entered EV manufacturing to avail the subsidies. Even when their core competency has nothing to do with EV manufacturing and even manufacturing anything. Same reason, some companies filled dumping yards with bogus "sold EVs", since repairing and keeping quality when being used will cost them more instead of making some substandard EV and generating fake sales cert. Similar policy PRC used when building up solar and battery industries. Subsidise a hundred companies, and few will come out as winners. Reportedly with real estate issues and semi trade war economy is facing headwinds and PRC is scaling down subsidies.
- okasaki 2y agoIt feels like The Economist and other Western oligarch media have been saying that China is going to collapse "next week" for decades. Almost like they have some sort of anti-reality agenda.
- jncfhnb 2y agoI can’t find that claim in the article.
- pphysch 2y agoIf you look at the aggregate of The Economist's "reporting" on China, the GPs comment is correct. One could even argue they are a Chinese asset because they mislead Western investors so fantastically and consistently on basic economic topics, a sort of Great Filter.
- gruez 2y ago>they mislead Western investors so fantastically and consistently on basic economic topics ???
- jncfhnb 2y ago[flagged]
- 1mcag 2y agoAny newspaper contains significantly more conjecture and guessing that the comment you reply to. It is ironic that the Economist was the magazine from which I learned speculating about behind the scenes actions and personal power politics. Yet you do not call the Economist reporters conspiracy theorists. The Economist is consistently wrong about ... economic predictions, which is what GP was making fun of.
- mrmetanoia 2y agoI regularly read The Economist and it is not a flawless outlet but it does not and has not attempted to perpetuate any sort of collapse narrative about China. Individual opinion pieces with negative outlooks based on current global market context? Perhaps, but an overarching narrative of collapse just doesn't exist.
- User23 2y agoExcess slack in productive capacity can be taken up not only with exports, but also with domestic demand side stimulus. The Chinese market is huge and can almost certainly generate demand for this productive capacity with proper fiscal policy.
- maxglute 2y agoChina's manufactures finding the winners. This is the system working as intended - create many producers in xyz sector via subsidies, hardcore (involution) competition from 1000s in different provinces innovate manufacturing to bare margins, losers go out of business/ get bought up by better competitors and consolidate like _intended_ outcome of other PRC industrial policy. TLDR Set up competitive environment to force producers speed run to a $250 model-T while everyone else could only make cars for $1000. Have so much competition to force manufactures to improve processes/drive down prices/affordability in short time and then settle with a few large but sustainable survivors that are globally competitive / can (out)compete with western incumbents.
- alephnerd 2y ago> China's manufactures finding the winners But what happens to the failures, especially since they are overwhelmingly subsidized by local governments? Shanghai (SAIC), Jiangxi (BAIC), Guangxi (GAG), Guangdong (GAC), Hebei (Dongfeng), Beijing (BAIC), and other prefectures are putting tens of millions of dollars in SoEs that cannot compete with BYD domestically, and face preemptive hurdles entering foreign markets. If these were private players, it wouldn't matter as much because they could be safely shut down, but these are mixed public-private, and this means a lot of misallocated capital due to political considerations. Ideally, all these prefectures could better utilize that equivalent amount of money building domestic consumption instead - like I pointed to you before, the median household income in China is still around $350-400/mo in 2024, so even with a loan, a cheap class-A vehicle like a Wuling Hongguang Mini is still pricy. Instead, these players are forced to export abroad leading to unnecessary trade wars and causing other countries to either limit ToTs with Chinese companies, or force Chinese companies to ToT to domestic players abroad. This is the same story in PV Cells, Analog Chips, Mobile Phones, etc.
- maxglute 2y agoSome local jurisdictions, especially wealthier ones will continue to misallocate because they can. For sectors like ev/pv/chips, they pay back in reducing imports/dependencies, some level of even stupid pork barrel waste should be expected/endured, i.e. US fine with 700B fossil subsidies because strategic. 700-800/m couple income fine for 4000-5000 budget EV (new). Realistically in a few years when EV enter secondary market, they'll be 2-3k used. E: (apology for edits, out and about) 6m / 50% of annual household 8500-9500. Vs US median household income of 75k (round up to 80k to be generous) and average new vehical price of 50k. Of course they're not equivalent quality goods, but the point of driving costs down is to make 4k-5k tier cars possible. >Instead, these players are forced to export abroad leading to unnecessary trade wars This is very necessary, no reason not to take share from incumbent car makers, especially in RoW markets. ToT domestic players fine (E: as in fine to jurisdictions that, especially ASEAN / more integration), especially with current sanctions/potential, PRC FDI via recirculating USDs, better use now than risk lose later. E2: Let's not pretend PRC trade wars are any less strategic than US trade wars (like semi). PRC EVs sells -> EV piles -> energy infra -> sensors/fusion -> telco.
- olalonde 2y agoThe title of the article is a bit misleading. Manufacturers are going broke because there's too many of them, which is arguably a nice problem to have.
- from-nibly 2y agoNot when your money is funding them even if you don't want it to.
- rkwz 2y agoGenuine question, if they have so much excess capacity and low domestic demand, wouldn't it be easier to just export to other countries? Or are there barriers put in place in the world stage that limits this?
- marcosdumay 2y agoYou are suggesting that China "just" exports an order of magnitude more. That's not a simple "just" you have there. Who is buying all those goods?
- Axsuul 2y agoTariffs[0] 0. https://www.bbc.com/news/articles/cy99z53qypko# https://www.bbc.com/news/articles/cy99z53qypko#
- chiph 2y agoA common bit of advice is to build one less of your widgets than what your customers will buy. You then meet demand (nearly!) and your price gets supported. Chinese manufacturers on the other hand, seem to be following the "build it and they will buy" philosophy. When you do this, prices (and profits) head towards zero. This is the exact opposite of the Toyota Way, where customer demand serves as a signal (Kanban) to produce a widget and deliver it when needed.
- almatabata 2y agoLet us assume they start dumping all their excess internationally. Do you think other countries will just allow china to flood the international market and drive other countries respective auto makers out of business? Other countries will raise tariffs accordingly until they reach an equilibrium that they feel comfortable with.
- fspeech 2y agoNot everyone makes cars. Shrinking the global market shares of the ones that do will make the competitors' economy of scale worse as they withdraw from the ROW to hide behind the trade barriers.
- highfrequency 2y agoThese are some staggering numbers: 52 thousand Chinese EV companies shut down last year. Xi Jinping (successfully) stimulated EV and semiconductor manufacturing through massive government investment and loans. The problem is that so many companies were funded that they are now viciously driving each other out of business through oversupply. Because the supply chain networks are so dense, each bankruptcy easily cascades because the company then defaults on contracts with vendors and customers. None of this, of course, is good news for US competitors like Tesla. With such a large field of vicious competition, it’s almost assured that the small set of businesses that succeed will be able to outcompete globally with extremely low cost structure. We see this happening with BYD.
- alephnerd 2y ago> With such a large field of vicious competition Other than BYD (which has a strong product market fit and a very strong technical foundation in both battery tech and automotive development), where can the competition export? Every major automotive market has preemptively or actively placed tariffs on Chinese automotive exports straight from China. SAIC, GAG, GAC, BAIC, BYD, etc will all have to either ToT IP, open domestic factories, or create JVs in order to enter most markets. BYD completely owns the Chinese EV market in absolute numbers - and the competitors had to preemptively begin exporting abroad, which sparked trade wars and worries of dumping, which made it harder for BYD and other players to export "Made in China" cars
- reisse 2y ago> where can the competition export? You see, there is a 1.5m-2m new car market right next to China, completely abandoned by western players. And another 500k-1m market in Central Asia, where General Motors neocolonialist monopoly is waiting for disruption. Of course it's not US or EU-sized market, but realistically, in the best case scenario I'd expect China to have at most 20% of US or EU. Here, they can take it all.
- alephnerd 2y ago> You see, there is a 1.5m-2m new car market right next to China, completely abandoned by western players Which one? If you mean Russia (which by the way is only 600-700k), then those Chinese players face secondary sanctions in most markets which settle trade in USD, along with a lot of politically connected domestic players. If you mean India, most Chinese players have been chased out or forced to transfer technology and majority ownership to Indian companies (eg. SAIC MG Motors India now being majority owned by JSW Group). Also, the dominant foreign players are Japanese and Korean with massive Indian government backing. If you mean VN, ID, MY, or PH, then it's South Korean and Japanese JVs that have a dominant position along with govenenent backing. > another 500k-1m market in Central Asia Which is dominated by a mix of American (GM) and South Korean (Hyundai) JVs with UzAutos, Russian automotive players, and Japanese JVs with Pakistani+Indian players (eg. Toyota x Pakistani Army)
- yorwba 2y agoTheir graph off loss-making industrial enterprises looks slightly more dramatic than the underlying monthly data. If you check the National Bureau of Statistics' data on 亏损企业 (月度数据 > 指标 > 工业 > 工业企业主要经济指标), https://data.stats.gov.cn https://data.stats.gov.cn you see that there is a yearly cycle where the number jumps in February: from 67,570 in 2021-12 to 132,371 in 2022-02 (January is skipped), from 91,222 in 2022-12 to 161,892 in 2023-2, and from 103,994 in 2023-12 to 167,895 in 2025-02. By plotting the last available month for every year, 2024 ends up sticking out a bit more than it will once the end-of-year data is out. Nonetheless, the overall trend is undeniable.
- kkfx 2y agoI fail to see a specific news, the article cite a single example of a failed BEV OEM, there are many, it's perfectly normal that some are not good enough to survive. In our golden age of automotive we have had countless automakers, most have failed some have skyrocketed... Aside overcapacity should be synonymous of low prices, I still wait to see here in EU prices like in the BRICS area for products imported from China. An example a BYD Atto 3 here cost a bit less than 40k€ while in Thailand cost a bit less than 10k€ https://asia.nikkei.com/content/1f9ed40b4b44745e1a39fafaf94b8b74 https://asia.nikkei.com/content/1f9ed40b4b44745e1a39fafaf94b... such price delta have no justification in mere free market economical terms, have only political justifications NONE OF THEM acceptable by the civil society. I still wait to see LFP batteries prices drops like in China to have a well-sized home battery at a price cheap enough to make buying it convenient, let's say 50kWh for 5k€. Let's say 15kW p.v. inverter for 1.5k€ etc. If China manufacturers goes broke we customers do the same in EU, and I suspect in USA to, simply to enrich some local cleptocrats.
- 486sx33 2y agoIt’s pretty simple, Chinese companies need to lower Chinese wages, reduce costs, reduce profit expectations, provide lower cost shipping to ports, guarantee the quality of their product once it arrives in North America not pay when it leaves the factory. We want $1 products again at dollar tree (not $1.25 tree), and better quality for less money. Otherwise we will just make the stuff in the USA ourselves. One day we will get smart and export more TO China because no one in China trusts the quality of anything made in China
- missedthecue 2y agoPersonally, I have been coming more around to Chinese manufactured goods. It used to be low-end crap 30 years ago, but they are market leaders in many sectors today and probably even more tomorrow. I recently drove a Chinese (ICE) SUV for the first time and was blown away by the fit, finish, and price.
- mensetmanusman 2y agoI think they are referencing various food scandals that rocked trust of Chinese food production in china (esp. for babies).
- aquamar2 2y agolots of other scandals, not just food 1.) recent 2024 huge scandal regarding oil container trucks swapping out cooking oil with cancerous industry oil without cleaning the tank. the trucks ended up covering up their tank with tarp so people can't see what kind of oil these trucks are carrying. 2.) videos of Chinese EVs just simultaneously combusting in the streets while driven or parked 3.) toxic chemicals found on Temu/Shien clothes, found by South Korea and US
- sandspar 2y agoGreat, now do scandals in the US. The Chinese internet was very interested in the Ohio train derailment, for example.
- naveen99 2y agoIf the capacity was for exports of ev’s, solar panels, batteries to U.S. and Europe, the 100% tariffs are going to bring some pain. somehow iPhones, leather bags are not getting tariffs.
- mensetmanusman 2y agoiPhone tariffs would hurt the us and china both too much. Ev tariffs are meh for china because they don’t sell here much anyway.
- naveen99 2y agoNot with 100% tariffs they won’t
- jeffbee 2y agoChina: tons of stuff, no profits. America: lots of profit, no product. Maybe we can borrow from each other? I can think of a bunch of sclerotic industries in America that need to have their margins driven to zero.
- leoprctmp 2y agoThis is a so-called trade war.
- xrd 2y agoDoes anyone know if this means hot deals on extra EV inventory? I tried to buy an electric golf cart which looked like a Hummer on Alibaba, but importing it (getting it past customs) was challenging. They had me at MP3 player! If I could buy an EV for $3k, it would be worth the hassle with charging infrastructure and hiding an illegal vehicle from the coppers. </joke>
- alephnerd 2y ago> If I could buy an EV for $3k The cheapest EV in CN rn is around $9k. Assuming you could even get a Wuling Mini road-cleared, you will need to pay out of your eyes in tarriffs and import taxes, making a used Tesla Model 3 roughly comparable price wise.
- seatac76 2y agoA lot of these were unsustainable to begin with, the number inflates the viability. The key players are expanding, and increasingly building out manufacturing in cheaper countries like Mexico, Vietnam, Thailand so they will become much more dominant.
- Veedrac 2y agoThis feels like a month later repeat of https://www.economist.com/business/2024/06/17/chinas-giant-solar-industry-is-in-turmoil https://www.economist.com/business/2024/06/17/chinas-giant-s..., which I first learnt about through a response in Asia Times, https://asiatimes.com/2024/07/chinas-subsidies-create-not-destroy-value/ https://asiatimes.com/2024/07/chinas-subsidies-create-not-de....
- rurban 2y agohttps://archive.is/20240815105917/https://www.economist.com/business/2024/08/08/chinas-manufacturers-are-going-broke https://archive.is/20240815105917/https://www.economist.com/... Some overly subsidized EV companies are going broke, and their inflated housing market crashes. Evergrande. Of course. That's a good thing. Still stronger growth than everywhere else. And their chip industry will soon be independent. This US war backfired massively.
- humanlity 2y agoIt’s amusing to see discussions about exotic markets like this. While I don’t agree with the CCP’s policies, I believe the issue is more related to free-market dynamics. Given today’s inflation, potential buyers are saving every penny. In China, unlike in the West, people spend based on their expectations and income, and they never resort to deficit spending. Considering the market situation and geopolitical factors, it is foreseeable that labor-intensive, low-value-added manufacturers are going bankrupt. Frankly, Europe and the US face similar situations. Regarding Taiwan and the South China Sea, the distrust of the East among Chinese people is influenced by historical experiences with North Korea, Japan, and Vietnam. However, in today’s world, war is a significant and serious issue, and ordinary citizens do not want to face its bitter consequences. What confuses me is that Western media often portray China as a threat, while Chinese mainstream media exaggerate these reports, deepening mutual hatred. P.S. I’m Chinese.
- Yeul 2y agoTo be fair China is a threat. For the last 200 years we've lived in a world dictated by the West. All other nations have always agreed to abide to the Western world view. Ofcourse China is at its core only a symptom. The world economy- and everything that goes with it- is irrevocably shifting to Asia. It's kinda offensive to see Americans talk about Vietnam or India. They see them as vassals not independent nations with interests of their own.
- alephnerd 2y ago> What confuses me is that Western media often portray China as a threat, while Chinese mainstream media exaggerate these reports, deepening mutual hatred There is a mutual lack of trust and dialogue amongst Chinese and American decisonmakwrs - most of whom started their careers in the late 1980s/early 1990s and thus lack modern in-depth experience in the West or China respectively. Both the Trump and Xi admins both bled competent advisers at the expense of populist and hawkish advisers, which degraded the ability for nuance in both the US and China's policymaking. Imo, the biggest issues have been the MFA/State Dept and the CMC/DoD in China/US. Both had massive attrition of experienced policymakers in the 2016-19 period, which caused a game of economic brinkmanship.
- bawana 2y agoIf china is pumping so much money into their economy, subsidizing every manufacturer, why dont they have runaway inflation?