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Influential US Senator Sherrod Brown Calls on US President Joe Biden to Ban Chinese Electric Vehicles
In a recent development, Senator Sherrod Brown (D–Ohio) has reached out to US President Joe Biden, urging him to take decisive action against electric vehicles manufactured by Chinese brands. Brown has characterized Chinese EVs as “an existential threat” to the American automotive industry. He asserts that allowing the influx of affordable Chinese electric vehicles into the US market is contrary to fostering a pro-worker industrial policy.
Brown’s concerns are not unfounded, as evidenced by a plethora of ongoing investigations and analyses. The European Union, for instance, initiated a probe into potential anti-subsidy practices by the Chinese government in supporting domestic EV manufacturers. This investigation raises questions about whether Chinese brands like BYD and MG enjoy an unfair advantage due to substantial state support.
The data from a recent study by the Kiel Institute indicate that BYD, a prominent Chinese automaker that now sells more EVs than Tesla, has received significant direct assistance from the Chinese government, amounting to nearly $4 billion in 2022 alone. Such substantial financial backing provides Chinese manufacturers with a competitive edge in global markets, potentially undermining fair competition.
Furthermore, the EU’s heightened scrutiny of Chinese EV imports underscores the growing unease surrounding the rapid expansion of these vehicles in international markets. The possibility of retroactive tariffs on Chinese EVs entering the US poses a challenge for potential importers due to existing barriers such as ineligibility for clean vehicle tax credits and high import taxes.
The Implications of Chinese Electric Vehicle Infiltration
Chinese EVs have already made inroads into Mexico, signaling a potential threat to American automakers. Ford’s CEO, Jim Farley, has expressed concerns about Chinese competitors overshadowing traditional industry giants like GM and Toyota. Elon Musk, the CEO of Tesla, has also warned about the potential dominance of Chinese EV manufacturers in the absence of trade barriers.
BYD’s recent launch of a budget-friendly EV model, the Seagull, coupled with its plans to establish a manufacturing facility in Mexico, could amplify competition in the US automotive market. However, Senator Joshua Hawley’s proposal to increase tariffs on Chinese EVs aims to address the looming threat of these vehicles flooding American roads.
Senator Brown’s comprehensive letter to President Biden not only highlights the economic ramifications of Chinese EV imports but also underscores the pressing need to address data security concerns. The influx of Chinese connected cars raises apprehensions about information privacy and national security, prompting the Commerce Department to launch investigations into potential risks.
Senator Brown’s call for stringent measures, including a potential ban on Chinese EVs, reflects the gravity of the situation. The Senator emphasizes the urgency of safeguarding American manufacturing and data integrity by exploring all available regulatory frameworks, such as Section 421 of the Trade Act of 1974, to counter the influence of Chinese electric vehicles on the US market.
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