(The Center Square) – Detroit placed the U.S. on wheels but if Motor City wants to go electric it faces fierce global competition.
Chinese electric vehicle maker BYD outsold Tesla in the fourth quarter of 2023. The foreign automaker said it produced more than 3 million new energy vehicles in 2023 compared to Tesla’s 1.8 million.
The Wall Street Journal reported BYD wants to build a factory in Mexico to avoid high tariffs and gain a foothold near the United States market. If successful, BYD would likely provide a much cheaper EV than domestic-made ones costing around $65,000.
“If there are not trade barriers established, they will pretty much demolish most other car companies in the world,” Tesla CEO Elon Musk said during Tesla’s January earnings call.
Stellantis CEO Carlos Tavares told reporters China “is possibly the biggest risk that companies like Tesla and ourselves are facing right now,’’ Tavare said. “We have to work very, very hard to make sure that we bring out consumers better offerings than the Chinese.”
Stellantis, one of the Big Three Detroit automakers, owns Jeep, Dodge and Chrysler, among other brands.
Amid high-interest rates, many consumers either can’t or don’t want to buy EVs because of range anxiety, a sparse charging network and a higher upfront cost.
Gov. Gretchen Whitmer proposed spending $25 million to provide a $2,500 subsidy for a union-made EV on top of the $7,500 federal EV subsidy for a total of $85 million in proposed subsidies for 2025.
About 34,380 EVs are registered in Michigan – short 1.9 million EVs of its 2030 goal.
“We’re showing the world that we make a lot more than just cars,” Whitmer said in her State of the State address. “In the decades ahead, we will dominate the manufacturing of batteries, chips, and clean energy too.”
However, the United Auto Workers union and Ford Motor Co. continue to fight since the 2023 strike cost the automaker about a billion and more than a month of disrupted production.
Ford CEO Jim Farley told Wolfe Research Auto Conference the automaker must “think carefully” about where it builds vehicles after the 2023 strike.
“Our reliance on the UAW turned out to be we were the first truck plant to be shut down,” Farley said. “Really our relationship has changed. It’s been a watershed moment for the company.”
About 9,000 UAW auto workers at Ford’s Kentucky Truck plant said they would strike on Friday if the automaker didn’t resolve a contract dispute.
By Scott McClallen | The Center Square
