According to a German economist, the European automobile industry will be pretty much dead in 10 years with Volkswagen hardly surviving on the mass market while brands like Mercedes, BMW and Audi will most likely retreat to producing luxury cars for those who can afford them. Remains to be seen if the banning of internal combustion engines by 2035 will inevitably lead to the collapse of Europe's automobile industry or if the banning itself will occur at all. This sole focus on EVs has caused irreversible damage to the industry, whatever you may think about the short-sightedness of European car manufacturers. It's still not clear if EVs are the future, depending on the advance of battery technology. Also, China is investing in both EVs and ICE cars but it knew it can't compete with European or Japanese manufacturers, so it shifted the focus onto EVs very early on which seems to pay off so far. The West's response: penalty duties. So much for the so-called free market. Only acceptable as long as others open their markets to our products. Free market and empire, liberalism and empire, go hand in hand but that's another topic. In the light of the Chinese being able to produce more cost-effective, Elon Musk remarked that they are going to ruin everybody unless trade barriers are imposed. The EU plans to introduce penalty duties on the basis of an "anti-subvention investigation."
The US is so scared of Chinese EVs, Biden had them declared as a threat to national security because they might be spying on the US. That can be said about every EV as they are suverillance boxes where you give up the last remnants of your so-called privacy. It's going to be fun when the police can monitor your driving at any given moment, making you pay for every single km/h above the speed limit, whether it's 1 km/h or 20. Maintenance cost will get a whole new meaning. BYD has come out with a rather ambitious plan to sell 120.000 cars in 2026 in Germany alone. To achieve that, 100 dealerships in Germany shall be opened, so that 90% of German citizens be in a range of not more than a 30 minute distance. Quite the plan. Looking at the state of the plummeting German economy, that seems unrealistic. They made headlines recently when a special ship delivered 3000 BYD cars. This company is also the second-biggest manufacturer of EV batteries after another Chinese company, CATL. Last year they sold 3 million cars on the global market but only half of them were EVs. The other half were hybrids. Western markets are vital to their investments (just as European car manfufacters were heavily dependant on their exports to/production in China) but it should be noted that this offensive to supersede Western competitors isn't owed to demand but European policy makers' obsession with electromobility. They might be cheaper but they're still too expensive for the average Joe here, especially in regards to maintenance costs. Car rental companies are getting rid of their EV fleets mainly because of the unsustainable maintenance costs.
How does BYD plan to circumvent US import restrictions? By building a factory in Mexico. The United States-Mexico-Canada Agreement (successor to NAFTA) would make exports to the US market possible. They'll do the same in Europe if penalty dues are introduced, which is very likely. Ursula von der Lying announced an "anti-subvention investigation" last September and 10-20% tariffs for Chinese EVs. There was a fear that German companies and Tesla might be affected, too, since they also produce in China for European markets but the policy is clearly aimed at Chinese manufacturers who keep their prices low thanks to high state subsidies, thus "distorting our markets." How much all of this will be effective is questionable. China might just react in the same way as European EVs are also highly subsidised or does anyone seriously think that Western corporations waste their own equity capital on a technology with an uncertain (near) future?