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BYD is a state-backed enterprise with unknown levels of profitability when full subsidies are accounted for. Tariffs will be needed by countries that refuse to

BYD is a state-backed enterprise with unknown levels of profitability when full subsidies are accounted for. Tariffs will be needed by countries that refuse to create state backed companies but which also want an automotive industry and a manufacturing base that can make weapons of war.

carlosjobim 2y ago
Lieutenant, I think you forgot one detail: customers.
- sidifjfjdidbd 2y ago
  The same customers who might now have jobs instead of seeing them shipped offshore? The purpose of an economy is not to increase shareholder value when the majority of the shares are held by .1% of the population.
  - carlosjobim 2y ago
    The purpose of an economy is neither to produce things that are so expensive that people cannot afford them. Since Western auto companies have failed, they should admit defeat, the leadership (and shareholders) should admit they are failures, and maybe open the doors to those who can make products which customers can afford. Car factories have used robots to make cars for decades now. The cars should have become cheaper with time, not several times more expensive. And if the factors making cars unaffordable for the average citizen is beyond the carmakers control, then those factors should be adressed. But tariffs sure won't make cars cheaper.
  - nehal3m 2y ago
    The purpose of a system is what it does and the economy definitely does what you described. Not saying that ought to be the case but unfortunately it is.
churchill 2y ago
Which still doesn't solve the problem: the real issue is that Western companies are financialized to the max. That's why Elon repeatedly lies to get a stock bump. Also, why companies like Google, Boeing, and Intel allow product quality to degrade, as long as they can prop up stock price for the next quarter. So, tariffs won't solve anything. Which is why despite the Jones Act, China builds 200x more ships that the US. Or, hasn't Tesla received billions in government assistance? what about the major automakers that'd have crumbled around 2008 if not for the US gov. pouring rivers of cash into them? So, protectionism is only a band-aid: it doesn't change the fact that American businesses have developed a short-termist culture that only cares for the next quarter.
- jeffreyrogers 2y ago
  If you want long-term thinking then people have to be able to buy into stories about what's going to happen long-term. When Musk does that, you call it a lie. The benefit of financialization is that it provides cheaper access to capital, which should make long-term investment easier, not harder. America still has lots of capital intensive industries that are capable of thinking long-term. I don't think financialization has much to do with the strategic problems that many American companies face. At the same time that Intel was allowing product quality to degrade, Nvidia, a 30 year old company, was continuing to innovate.
  - churchill 2y ago
    No, I don't have a personal axe to grind against Musk. I'm just pointing out his persistent, repeated lies. Being an engineer, he should be able to gauge their capabilities accordingly, or at least make those optimistic predictions closer to the finish line.
    - schiffern 2y ago
      "Lies" is pretty charged phrasing for what are explicitly declared as best-case timeline estimates, which the media then loves to (disingenuously) revise into "promises." The not-so-big management secret is that even if Musk took your advice and sandbagged his timelines, then the timelines still wouldn't be met. However it would move the actual time of completion further to the right! By using best-case predictions, things are actually getting done sooner. Call it the Applied Parkinson's Law. https://en.wikipedia.org/wiki/Parkinson's_law https://en.wikipedia.org/wiki/Parkinson's_law
KennyBlanken 2y ago
> BYD is a state-backed enterprise And Tesla isn't? https://www.latimes.com/business/la-fi-hy-musk-subsidies-20150531-story.html https://www.latimes.com/business/la-fi-hy-musk-subsidies-201... GM, Ford, and Chrysler (now Stellantis or whatever they call themselves) could easily be described as the same with all the subsidies and trade protection they get. For example, aero headlights were not legal in the US for ages until Ford wanted to use them in the upcoming Taurus. European and Japanese companies had to use US-specific headlights, usually sealed beam units. This nonsense still goes on today. Why do you think CCS has a unique-to-US charge connector? To make things more expensive for foreign car companies. Then we have the insane "must be built here" restrictions...
- mensetmanusman 2y ago
  Chinese subsidies are an order of magnitude larger, which makes it a difference of kind (according to various government treasury departments).
  - cma 2y ago
    Tesla got $300million for battery swapping and $1 billion for a Buffalo solar plant. Many other billions total with federal and Nevada, Texas. And various state incentive programs. Their partner Panasonic is a keiretsu and I think has gotten billions in EV battery related subsidies overall. BYD I think is similar order of magnitude to the two partners combined.
  - slaw 2y ago
    > China gave BYD $3.7 billion to ‘win’ the EV race. That amounts to $1k per vehicle, so China subsidies are an order of magnitude smaller than US or EU subsidies. https://electrek.co/2024/04/12/china-gave-byd-an-incredible- https://electrek.co/2024/04/12/china-gave-byd-an-incredible-...
    - Tiktaalik 2y ago
      We're experiencing an existential climate emergency. It's a good thing for a state to heavily invest in green technology for export. USA and EU should be doing the same.
gooosle 2y ago
> Tariffs will be needed by countries that refuse to create state backed companies Which countries are those? All western car manufacturers are backed by the state as far as I'm aware.
- esperent 2y ago
  > All western car manufacturers are backed by the state As far as I can tell, this is entirely incorrect when it comes to European car companies. In the US, beside bailing out GM in the 2008 crash, they do give government loans to some car companies. But I don't agree that giving loans that equates to being "backed by the state".
  - asadotzler 2y ago
    Giving massive subsidies to consumers to purchase said EVs does make them state-backed, however.
    - esperent 2y ago
      In Europe at least, the subsidies are for any electric car, not just European made cars.
  - croes 2y ago
    Backed by politics not necessarily subsidies. Do you think the German state of Lower Saxony would hurt its 20% shares of Volkswagen? Or what about the exemptions for power costs for high usage companies? Maybe not car manufacturer specific but still a kind of subsidy. Every country does more or less obvious.
7thpower 2y ago
While this is a valid argument, it is disappointing the US domestic industry gets a pass after pivoting their assortment heavily toward luxury vehicles. Tesla has basically been the only domestic automaker taking risks and aggressively pursuing manufacturing efficiencies. There are all sorts of unacceptable national security tradeoffs that come with allowing domestic industrial capacity to diminish and China to own more of the automotive supply chain, but the industry is also going to be less competitive long term, and consumers are going to have fewer discretionary dollars.
- daghamm 2y ago
  "Tesla has basically been the only domestic automaker taking risks and aggressively pursuing manufacturing efficiencies." Sometimes too aggressive which may come back and hunt them. For example, multiple companies are doing full body casting but Tesla moved very fast and ended up selling cars that now have cracks in them. There is a reason it took others longer time to introduce this in their factories... https://www.thedrive.com/news/tesla-model-y-owner-finds-scary-cracks-in-gigacast-front-end https://www.thedrive.com/news/tesla-model-y-owner-finds-scar... The situation is much worse for Chinese manufacturers. Some of these cars are death traps.
downrightmike 2y ago
At this point we aren't going under 2C, so if they want to make those cars cheaply, I'm all for bringing them here to sell, we bailed out our auto MFG and we are literally in the same spot/ mfg preference, with SUVs as we were when they failed last time. US MFG have not done the work, let the chinese ones who did in. Most US MFG heavily outsourced anyway, it isn't like letting the chinese cars in, is that much different.
- mensetmanusman 2y ago
  If we were just optimizing for climate yes, but because that policy would decimate the manufacturing base for war machines, it gets more complicated. Either way, the climate gets better because China is the largest influence.
lm28469 2y ago
Imagine if the west was smart enough to have state owned companies that work towards saving our future regardless of the profitability. But no, we have to buy overpriced pieces of shit because God forbid we touch one hair of the "free" market
- blitzar 2y ago
  > God forbid we touch one hair of the "free" market Except for the subsidies, no bid government contracts, tax breaks, loan gaurantees and eventually piles of cash for when they blow through all of the above and run out of money. Unlike those backwards communists we are proud free market capitalists.
  - mensetmanusman 2y ago
    We have free markets as the ideal. China has collectivism as the ideal. Both have given up on some parts of ideology in the face of the real world.

carlosjobim 2y ago

Lieutenant, I think you forgot one detail: customers.

sidifjfjdidbd 2y ago
The same customers who might now have jobs instead of seeing them shipped offshore? The purpose of an economy is not to increase shareholder value when the majority of the shares are held by .1% of the population.
- carlosjobim 2y ago
  The purpose of an economy is neither to produce things that are so expensive that people cannot afford them. Since Western auto companies have failed, they should admit defeat, the leadership (and shareholders) should admit they are failures, and maybe open the doors to those who can make products which customers can afford. Car factories have used robots to make cars for decades now. The cars should have become cheaper with time, not several times more expensive. And if the factors making cars unaffordable for the average citizen is beyond the carmakers control, then those factors should be adressed. But tariffs sure won't make cars cheaper.
- nehal3m 2y ago
  The purpose of a system is what it does and the economy definitely does what you described. Not saying that ought to be the case but unfortunately it is.

churchill 2y ago

Which still doesn't solve the problem: the real issue is that Western companies are financialized to the max. That's why Elon repeatedly lies to get a stock bump. Also, why companies like Google, Boeing, and Intel allow product quality to degrade, as long as they can prop up stock price for the next quarter. So, tariffs won't solve anything. Which is why despite the Jones Act, China builds 200x more ships that the US. Or, hasn't Tesla received billions in government assistance? what about the major automakers that'd have crumbled around 2008 if not for the US gov. pouring rivers of cash into them? So, protectionism is only a band-aid: it doesn't change the fact that American businesses have developed a short-termist culture that only cares for the next quarter.

jeffreyrogers 2y ago
If you want long-term thinking then people have to be able to buy into stories about what's going to happen long-term. When Musk does that, you call it a lie. The benefit of financialization is that it provides cheaper access to capital, which should make long-term investment easier, not harder. America still has lots of capital intensive industries that are capable of thinking long-term. I don't think financialization has much to do with the strategic problems that many American companies face. At the same time that Intel was allowing product quality to degrade, Nvidia, a 30 year old company, was continuing to innovate.
- churchill 2y ago
  No, I don't have a personal axe to grind against Musk. I'm just pointing out his persistent, repeated lies. Being an engineer, he should be able to gauge their capabilities accordingly, or at least make those optimistic predictions closer to the finish line.
  - schiffern 2y ago
    "Lies" is pretty charged phrasing for what are explicitly declared as best-case timeline estimates, which the media then loves to (disingenuously) revise into "promises." The not-so-big management secret is that even if Musk took your advice and sandbagged his timelines, then the timelines still wouldn't be met. However it would move the actual time of completion further to the right! By using best-case predictions, things are actually getting done sooner. Call it the Applied Parkinson's Law. https://en.wikipedia.org/wiki/Parkinson's_law https://en.wikipedia.org/wiki/Parkinson's_law

KennyBlanken 2y ago

> BYD is a state-backed enterprise And Tesla isn't? https://www.latimes.com/business/la-fi-hy-musk-subsidies-20150531-story.html https://www.latimes.com/business/la-fi-hy-musk-subsidies-201... GM, Ford, and Chrysler (now Stellantis or whatever they call themselves) could easily be described as the same with all the subsidies and trade protection they get. For example, aero headlights were not legal in the US for ages until Ford wanted to use them in the upcoming Taurus. European and Japanese companies had to use US-specific headlights, usually sealed beam units. This nonsense still goes on today. Why do you think CCS has a unique-to-US charge connector? To make things more expensive for foreign car companies. Then we have the insane "must be built here" restrictions...

mensetmanusman 2y ago
Chinese subsidies are an order of magnitude larger, which makes it a difference of kind (according to various government treasury departments).
- cma 2y ago
  Tesla got $300million for battery swapping and $1 billion for a Buffalo solar plant. Many other billions total with federal and Nevada, Texas. And various state incentive programs. Their partner Panasonic is a keiretsu and I think has gotten billions in EV battery related subsidies overall. BYD I think is similar order of magnitude to the two partners combined.
- slaw 2y ago
  > China gave BYD $3.7 billion to ‘win’ the EV race. That amounts to $1k per vehicle, so China subsidies are an order of magnitude smaller than US or EU subsidies. https://electrek.co/2024/04/12/china-gave-byd-an-incredible- https://electrek.co/2024/04/12/china-gave-byd-an-incredible-...
  - Tiktaalik 2y ago
    We're experiencing an existential climate emergency. It's a good thing for a state to heavily invest in green technology for export. USA and EU should be doing the same.

gooosle 2y ago

> Tariffs will be needed by countries that refuse to create state backed companies Which countries are those? All western car manufacturers are backed by the state as far as I'm aware.

esperent 2y ago
> All western car manufacturers are backed by the state As far as I can tell, this is entirely incorrect when it comes to European car companies. In the US, beside bailing out GM in the 2008 crash, they do give government loans to some car companies. But I don't agree that giving loans that equates to being "backed by the state".
- asadotzler 2y ago
  Giving massive subsidies to consumers to purchase said EVs does make them state-backed, however.
  - esperent 2y ago
    In Europe at least, the subsidies are for any electric car, not just European made cars.
- croes 2y ago
  Backed by politics not necessarily subsidies. Do you think the German state of Lower Saxony would hurt its 20% shares of Volkswagen? Or what about the exemptions for power costs for high usage companies? Maybe not car manufacturer specific but still a kind of subsidy. Every country does more or less obvious.

7thpower 2y ago

While this is a valid argument, it is disappointing the US domestic industry gets a pass after pivoting their assortment heavily toward luxury vehicles. Tesla has basically been the only domestic automaker taking risks and aggressively pursuing manufacturing efficiencies. There are all sorts of unacceptable national security tradeoffs that come with allowing domestic industrial capacity to diminish and China to own more of the automotive supply chain, but the industry is also going to be less competitive long term, and consumers are going to have fewer discretionary dollars.

daghamm 2y ago
"Tesla has basically been the only domestic automaker taking risks and aggressively pursuing manufacturing efficiencies." Sometimes too aggressive which may come back and hunt them. For example, multiple companies are doing full body casting but Tesla moved very fast and ended up selling cars that now have cracks in them. There is a reason it took others longer time to introduce this in their factories... https://www.thedrive.com/news/tesla-model-y-owner-finds-scary-cracks-in-gigacast-front-end https://www.thedrive.com/news/tesla-model-y-owner-finds-scar... The situation is much worse for Chinese manufacturers. Some of these cars are death traps.

downrightmike 2y ago

At this point we aren't going under 2C, so if they want to make those cars cheaply, I'm all for bringing them here to sell, we bailed out our auto MFG and we are literally in the same spot/ mfg preference, with SUVs as we were when they failed last time. US MFG have not done the work, let the chinese ones who did in. Most US MFG heavily outsourced anyway, it isn't like letting the chinese cars in, is that much different.

mensetmanusman 2y ago
If we were just optimizing for climate yes, but because that policy would decimate the manufacturing base for war machines, it gets more complicated. Either way, the climate gets better because China is the largest influence.

lm28469 2y ago

Imagine if the west was smart enough to have state owned companies that work towards saving our future regardless of the profitability. But no, we have to buy overpriced pieces of shit because God forbid we touch one hair of the "free" market

blitzar 2y ago
> God forbid we touch one hair of the "free" market Except for the subsidies, no bid government contracts, tax breaks, loan gaurantees and eventually piles of cash for when they blow through all of the above and run out of money. Unlike those backwards communists we are proud free market capitalists.
- mensetmanusman 2y ago
  We have free markets as the ideal. China has collectivism as the ideal. Both have given up on some parts of ideology in the face of the real world.