It’s entirely possible.
President Joe Biden is shooting America in the foot by requiring two thirds of all cars built in the USA to be electric. That means by next decade, you’ll be hard pressed to find a new traditional car to buy, and his administration is slowly trying to phase out gasoline stations, replacing them with electric charging ports.
So, the new cars available for sale will overwhelmingly be electric. The US is going to spend taxpayer money to be able to convert manufacturing to produce these cars.
But here’s the problem — China can do it better. The death of the classic American auto industry has slowly been coming, but expect China to put it into overdrive, allowing the US economy to spin even further out of control.
Already in China, GM’s sales declined by 20%, while Ford’s declined by 33% in a single year.
While these American auto titans manufacture a bit in China, there’s a new kid in town whose killing those brands at home. Now, expect the brand to knife out the auto legends in the US as well.
Meet Changan. That’s the brand new, Chinese car company that will be making their own brand of electric vehicles, free from the shackles of working under an American company like Ford. You’ll be seeing a lot of these Changan cars on US roads in the near future.
Nio and Geely are two other Chinese companies that have already been exporting to Europe. North America isn’t far behind.
These cars can be produced, due to labor costs and resource proximity, at a much cheaper rate than our continent can ever dream of. And of course, they’ll be significantly cheaper.
Cheap matters when you’re options for new car buying are severely, historically limited.
American companies are unlikely to catch up, and lord knows they’ve tried. GM tried producing an electric car for under $30,000 called The Volt EV. Due to slow progress and rising material cost, GM nixed the idea completely. Now they are producing exorbitantly expensive electric pickup trucks.
One popular Chinese electric car is the Wuling Hong Guang Mini EV (a mouthful, I know!). It’s a tiny little thing great for tight urban environments and it costs just $11,000. Now, in the US and Canada these small putters may not explode in popularity. But Mexico? With a rapidly rising middle class, if you ever drove in the downtown of any Mexican city you’ll know, those streets are tiny, wild and unregulated. Watch this little car explode south of the border, igniting the spark for China to dominate North American car sales, while gutting the car manufacturing output of the USA, Canada and Mexico.
President Biden has issued an almost 30% tariff on import. But even with that, these electric cars might go for $20,000 in the USA. The starting price for a Tesla? $50,000. That’s still a massive difference.