The whole world: We need cheap EVs for the regular people.
China: I got you fam.
The world: Tarifs.
It’s a bit more complicated than that. You don’t want total reliance from one country (especially one as questionable as China) over a whole big ass sector of your economic. And China being super cheap will cause a monopoly of their EVs. That’s bad.
A monopoly is not inherently bad. A monopoly removes the incentive for pricing pressure, yes, but that requires consolidation in a single company, not a single country. China’s only been able to sell EVs so cheap because every company that couldn’t drive prices this low got blown the fuck out of the market. That’s competition, not a monopoly. By extension, if EV prices go back up, those competitors can pretty easily restart given the billions of venture funding swimming around in China.
A monopoly isn’t inherently bad, but a monopoly by a state is pretty bad. It means they can exert political pressure over you using that sector’s influence.
Heck, look at Russia and gas. It impacted tons of people all over the world, and if the world hadn’t collectively said “fuck you Russia we’ll handle ourselves without you” - then countries like Germany wouldn’t have a choice but keep buying Russian Gas.
That’s a political power you really don’t wanna give to anyone, especially not China.
Yes, competition could restart, but that’d take time. And you don’t always have that time. Again, see Russia and gas as a nice example for that.
Sure, I agree, but your claim hinges on the fact that the Chinese EV market lacks competition (like, say, Russia with Gazprom and nobody else).
That’s easily disprovable.
It’s dumber than that. We could do it if we cared about long term profits rather than next-quarter profits.
Yes but that would have tax implications.