“Right Wing Woke Bullshit” Killing US Autos

If the Chinese had wanted to build an AI designed to kill the US auto industry, they could hardly have created anything more lethal than the current administration.

Brian Deese in the New York Times:

For over a century, the auto industry has been a cornerstone of America’s industrial power: It revolutionized manufacturing with the assembly line, forged stronger forms of steel, aluminum and carbon fiber and drove technological innovation with the invention of sophisticated robotics and sensors. And because the auto industry’s influence extends far beyond the factory, supporting vast supply chains, restaurants and retail stores, it’s also been a key driver of economic opportunity in the industrial Midwest and beyond.

But today U.S. automakers are falling behind in a global race for innovation in electrification, digitization and automation. China has made huge strides in producing next-generation vehicles, backed by billions in state subsidies intended to undercut competitors and dominate global manufacturing. While Tesla specifically has led in battery and automation innovation, the scale and quality of China’s manufacturing are putting America’s entire auto industry at risk. If we lose the supply chains, workers and industrial capabilities that produce the cars we drive, we may also lose our capacity to manufacture vital technologies and military equipment.

This is not the first time the American auto industry has faced a critical challenge. In the early 1980s, an onslaught of low-priced, fuel-efficient and government-subsidized Japanese vehicles overwhelmed U.S. automakers, prompting President Ronald Reagan to negotiate temporary limits on Japanese auto imports. That gave American automakers the runway to catch up, increase their profits and innovate (including by producing the first minivans).

We should learn from this history today: Protections should be targeted, coordinated with allies, time limited and paired with incentives to innovate.

Unfortunately, this is the opposite of the Trump strategy, which applies a 25 percent tax on imported vehicles and parts. Because nearly 60 percent of parts in typical U.S.-made vehicles are imported, these across-the-board tariffs will drive up the price of American cars, diminish their global competitiveness and ultimately reduce output. The cost to our auto industry, estimated at $108 billion, will fall hardest on smaller, more vulnerable companies. It has already led to layoffs.

Blanket tariffs work to China’s advantage in particular. By targeting Mexico, Germany and Japan, Mr. Trump will hurt the bottom lines of their automakers, leaving China with even less foreign competition and driving our allies away as they seek new customers.

If his tariffs weren’t enough, Mr. Trump is also mounting an assault on American innovation, motivated by his aversion to electric vehicles and his desire to slash the size of government. Worryingly, this is already weighing on one of the most important axes of innovation for the 21st century: energy storage. Batteries will determine not only who wins the race to manufacture the cars of the future but also America’s ability to decarbonize and maintain a modern military with key technologies like battery-powered drones and electromagnetic weapons.

Evan Halper in Washington Post:

Energy Secretary Chris Wright, an oil executive before his nomination, said in a speech last month that the administration’s plan is “to reverse the destructive mandates, forcing everyone to buy EVs that have been wreaking havoc on our auto industry and forcing higher prices and reduced choices on consumers.”

He and Trump argue the policy reversals will usher in a renaissance for U.S. automakers, now free to focus on the gas cars that still generate the bulk of their profits.

But the policy will also ensure the U.S. remains behind in the global EV race. Of the more than 17 million EVs sold in 2024 around the world, according to the China Passenger Car Association and research firm Rho Motion, 76 percent of those cars were made by Chinese companies.

Electric vehicles, including plug-in hybrids, now account for 19 percent of all cars sold worldwide, up from just 4 percent five years ago. Chinese models account for 17 of the 20 top-selling plug-ins globally, according to CleanTechnica. The only U.S. company that ranks on that list is Tesla, and it is fast losing market share. Tesla vehicle deliveries plunged 13 percent the first quarter this year.

In Brazil, where Ford has stopped making cars altogether, its former factory is now owned by BYD, which dominates the country’s fledgling but fast-growing EV market. Sales of EVs in Brazil grew 85 percent in 2024. A local lawmaker wants to change the name of the street where the factory sits from Henry Ford Avenue to BYD Avenue. BYD and other Chinese EV companies are steadily growing their market share in Europe, with BYD building a plant in Hungary and other Chinese brands eyeing factories in Poland and Spain.

Detroit executives, criticized for years for focusing on gas-guzzling SUVs and trucks, are now trying to catch up while navigating the shifting winds from Washington.

Soon after the president signed an order directing a pivot away from EVs, Ford CEO Jim Farley was warning shareholders that the company needs to urgently lean in on electric. He highlighted in a call how motorists around the world are rapidly shifting to EVs and markets where American vehicles were long king are now being “dominated by the Chinese.”

Farley himself had a Xiaomi electric car delivered from Shanghai to Chicago and drove it for months, telling a podcaster in October how he marvels at this vehicle that was designed and manufactured by a cellphone company.

He said Ford is retooling its strategy around EVs with a moonshot-like effort to replicate the Chinese model of innovating cheap, high-tech vehicles in a division walled off from the company’s legacy production lines.

General Motors says it is racing to develop a breakthrough in battery technology that would reposition it as a major player in the EV race.