Tuesday, March 21, 2023

Opinion. Why a law discriminating against foreign electric cars in the United States may be a good idea

The President of the United States has introduced a rule by which electric cars are not manufactured in the United States or in countries with free trade agreements such as Canada or Mexico, Will not be able to get public assistance for your purchase. A protectionist movement has been strongly criticized by Europe and China, but it can have many positive effects.

The Inflation Reduction Act, within the package of measures to fight against the economic crisis, this clause will require that those brands which Those who want to receive $7,500 in public aid will have to follow a number of measuresSuch as producing their vehicles in the United States, Canada or Mexico, and the battery components have a specific origin and do not come from markets such as China.

It aims to gradually reduce dependence on China which controls the supply of core materials such as nickel, cobalt, graphite, lithium.

The United States Department of Energy has published a table with the electric cars and plug-in hybrids that are manufactured in its region and which fall under the new requirements. a list made of 31 models where we only get six European offers, and one Asian. Nissan Leaf.

Opinion. Why A Law Discriminating Against Foreign Electric Cars In The United States May Be A Good Idea
List of electric or plug-in models manufactured in the United States

Nor are there some models that seem to yield the best results, such as group proposals. hyundai/kiaThe IONIQ 5 and KIA EV6 or KIA e-Niro both ranked sixth, seventh and ninth respectively in sales of electric cars in the US market between January and July.

where a top 10 sales Polestar 2Which will also not comply with the new rules of the US administration and where other European models will be added, except for a few, such as the Volkswagen ID. 4 which will be produced in Chattanooga, Tennessee, but which will have to demonstrate that its battery origin is compatible.

Top 10 best-selling electric cars in the United States: January-July 2022

  1. Tesla Model Y: 103, 215 units
  2. Tesla Model 3: 97,075 units
  3. Ford Mustang Mach-E: 18,399 Units
  4. Tesla Model S: 15,317 units
  5. Tesla Model X: 13,384 units
  6. Hyundai Ioniq 5: 13,200 Units
  7. Kia EV6: 12,036 units
  8. Nissan Leaf: 7,911 units
  9. Kia Niro EV: 6,931 Units
  10. Polestar 2: 4,873 units

Inflation Reduction Act Is It A Good Idea?

Ford F-150 Lightning

we are definitely the first a purely protectionist measure Which seeks, on the one hand, to increase investment in local production of electric cars, and at the same time reduce China’s reliance on strategic materials that will affect the transportation sector, but also the energy sector due to the increasing importance of backup systems. electrical network.

This would be a double blow for European models, but above all for the Chinese who play the trick of lowering their local production costs and it would mean their vehicles are $7,500 less competitive than their local rivals. Something that can help a lot in balancing the economic balance.

But such measures, or at least similar measures, have already been tried by China at that time. Rules that compel foreign brands that wish to establish themselves in their region to do so with a joint venture with a local brand. A good idea on paper as well, but one that ended several decades later, when it was discovered that it was negatively impacting the competitiveness of Chinese brands, without investing much in R&D or marketing. Hoping away. fruit automatically.

Some groups that have seen the transition to a more competitive market A stratospheric leap for its clusters means Which have become an object of desire ahead of Western brands by being considered a forced purchase punishment only for those with low purchasing power.

Another major factor in this type of movement is that Will reduce pollution emissions in vehicular transport, And that a local production means avoiding the transfer of millions of cars by sea for thousands of kilometers. The effect of great dimensions which will inevitably diminish with manufacturing closer to the customer.

But where almost all experts agree that It is absurd to give public support to electric cars manufactured outside the confines of the market where they are sold., And it is that China has been limiting subsidies to locally produced brands from the very beginning.

Something that has not attracted attention or caused a scandal on the part of trade organizations, and which for many should be adopted immediately by the United States and Europe to prevent an imminent invasion of Chinese models.

And what do you think, is the implementation of this protectionist measure a good or a bad idea?

Nation World News Desk
Nation World News Deskhttps://nationworldnews.com
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