HomeExpansionismBiden Advised to Prevent China from Dumping EVs on U.S.

Biden Advised to Prevent China from Dumping EVs on U.S.

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Senator Sherrod Brown of Ohio has called for a ban on Chinese-made electric vehicles (EVs) in the United States, citing concerns over economic and national security. In a detailed appeal to President Biden, Brown highlights the substantial subsidies that Chinese automakers receive from their government, which he believes distort the competitive landscape to the detriment of American workers and the broader U.S. auto industry.

Brown’s primary argument revolves around the notion that Chinese EVs, supported by their government, pose an “existential threat” to the American auto sector. He notes that industries in Ohio have already suffered due to similar competitive disadvantages in steel and solar manufacturing, exacerbated by what he terms as “government-backed cheating” from China. This, he argues, undermines not only the U.S. economic landscape but also the national security, as the technology in EVs could potentially offer the Chinese government access to sensitive data.

ACZ analysts believe he is correct in this assertion that the potential for dumping EVs subsidized by the Chinese government would be catastrophic for the American auto industry. However, this could also be seen as protectionism, a bad word in modern economics. Plus it will likely slow down the progress of EV adoption, and its impact on the climate change agenda, an agenda near and dear to Biden’s heart.

Chinese EVs are notoriously bad and would not likely be a best seller in the U.S. market. But the experience in the market, assuming China’s automakers as savvy, would lead to better cars that fit the market better. China intends to buy its way in, and then adapt. A good strategy but requiring a very long view and the deep pockets of the Chinese government.

The senator emphasizes that these vehicles threaten to undercut American manufacturing by flooding the market with low-cost, subsidized products, making it nearly impossible for American companies to compete on a level playing field. This could lead to significant job losses, particularly affecting members of the United Autoworkers union, potentially destabilizing an entire sector that supports numerous other industries and broader economic stability.

Furthermore, Brown argues that the current tariff policy is insufficient. Despite a 27.5% combined tariff on imported Chinese vehicles, the low production costs enabled by subsidies mean that Chinese EVs could still enter the U.S. market at prices drastically lower than those produced domestically. This pricing strategy, according to Brown, could trigger a crisis akin to an “extinction-level event” for the U.S. auto industry.

In his call to action, Brown urges the Biden administration to take bold measures, including banning these imports outright and working collaboratively with international allies to address the issue comprehensively. He warns that without such actions, the U.S. risks not only economic and job losses but also the erosion of national security due to the potential misuse of data collected by Chinese EVs.

Brown’s stance is part of a broader narrative of increasing scrutiny and restriction on Chinese technology and trade practices, reflecting growing geopolitical tensions and concerns over fairness in global trade practices. The implications of his proposal extend beyond the auto industry, touching on broader themes of trade, technology, and international relations, as the global market continues to grapple with the rapid advancement of EV technology and its integration into national infrastructures.

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