Just hike tariffs on foreign gasoline cars in China.
New Energy Vehicles (NEVs) in China
- Thread starter supercat
- Start date
That may be. But point is that tariffs are changed over time, due to politics. So when politics decide for whatever reason that tariffs go up by another 50 or 100%, then certain products will cease to be competitive.
And tariffs will lead to other tariffs and soon it will end in two blocs. Chinese/Other bloc and US/EU/Other bloc. And no side will have competitively priced products being sold in the other side's market. Now whether that's good or bad is completely different discussion in which i will not partake.
The best way to describe corporations is that they are like steering massive cruise ships. When you see the icebergs ahead, you need to make those steering inputs early, not late, because late is often too late.
One problem with Toyota and Honda is that they do not control the supply chain, but of course, none does completely, unlike BYD, who makes its own batteries and designs its own chips (fabless chipmaker). This is where the monster analogy comes in. If you want to be a force in the field five years from now, now is the time you better start creating your supply chain.
Car wars is all about margin wars. If you are only making a profit out of a few hundred dollars a car, margin control is essential and for that to happen, you need a tight grip of your supply chain. If you make your own batteries for example, your cost would be lower than if you have to buy it from someone else.
With CATL dominating Lithium Iron Phosphate for example, and LIP batteries is becoming increasingly the cost for the low end EV for its low costs and safety, how is Toyota and Honda going to source them? I don't think Panasonic makes LIP. Look at GM, which sourced batteries from LG Chem, and what a flaming wreck the Chevy Volt has become. Fact is EV batteries is a very safety sensitive issue and requires multiple levels of testing. I have yet to see anyone claiming that ramming a nail through their battery won't make it explode unlike the BYD Blade battery, which I believe is a major game changer. I also see the Chinese battery makers, CATL and BYD especially, leading the charge for cobalt free battery already tested and ready to deploy them, when others like Panasonic and LG Chem, are still using nickel and cobalt. We're talking about an advantage that is in years.
PeoplesPoster
Junior Member
There are already significant tariffs on foreign cars in China. I believe most Toyota's and Honda's etc in China are manufactured in China with local partners, so if you ban those brands your only hurting yourself.
broadsword
Brigadier
Toyota is developing the next generation battery which is solid-state. Honda will source from CATL like Merc, BMW and other Chinese EV makers.
It is not the source or type of batteries that will be the deciding factor. Battery fires will be sorted in this young industry. The main thing about the battery the consumer cares about is the range, safety and life-span, not the materials used. Mitsubishi and Nissan's EVs have so far been the compacts, unlike the bigger sizes of their competitors which serve a bigger market.
One heavy stress factor for the current ICE makers will be the entry of Apple. When you have Apple, you will find Xiaomi, Oppo, etc.
According to Sandy Munro, the Toyota solid state battery project is phase zero. It means its still a lab project. That means all the hurdles are still ahead of you, such as real life, abuse and safety testing.
Range, safety and life span, not to mention cost and sustainability is where CATL and BYD are hitting it out of the park. That's why even Tesla is buying BYD blade batteries. Nicket Metal Hydride, which is used on earlier and now high end EVs, uses cobalt, and we know there is sustainability issues from where these minerals are derived. Lithium Ion Phosphate is a very safe battery chemistry, albeit with lower energy density. BYD Blade alleviates energy density by clever physical packaging. CATL can turn the market around as Sodium Ion is a game changer as it doesn't use Lithium, Nicket and Cobalt. By the way, the Chevy Volt recall? They are changing the batteries over to LiP.
China is clearly leading the way to low cost EVs, which is where the disruption factor against ICEs would be located. In this context, the US$5000 Wuling car is a historical game changer. When EVs are starting to appear from the $5000 to $25000 segment, they will begin to eat the ICE market's lunch. That's why Akio Toyoda is panicing. He's smart enough to see where its going and realize that Toyota isn't agile enough to make this change in time.
Just ban Japanese brands locally. The people will then buy local brands, which will make more money. The factories will still crank out Chinese brands.
If by "blocs" you mean isolated areas, with almost no inter-area trade, then that may not happen.
In 2017, .
As for the EU, I wrote earlier about Volkswagen, by far the largest carmaker in Europe:
As for Japan, in 2019 ($141 billion); the US was a distant second ($119 billion).
And I haven't even mentioned the $trillions that Boeing and Airbus stand to lose if rigid trading blocs formed, and China stopped buying airplanes from abroad. So a world of blocs is not by any means a guaranteed thing.
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China should bar state-owned carmakers from making EVs in their joint-ventures with overseas carmakers. Those SOEs are basically subsiding foreigners.