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They go for next quarter profits instead of value for consumers . Stopped building affordable cars favoring trucks. Shipped car industry to China. The end
Went for trucks for greater profit margin and lower regulations but lost the volume game. For capitalists, they sure suck at it.
Even if you ignore the US obsession with trucks, western manufacturers labour costs are much higher and there aren't subsidies on manufacturing EVs, only buying them. Chinese EVs get manufacturing subsidies and then in many countries they also get a local subsidy at the point of purchase. It's an underhanded tactic, the Chinese government is essentially paying people outside of China to buy Chinese EVs so western competiton would die.
they have all the manufacturing there, I'm sure all the parts are dirt cheap for them if you don't ship em cross ocean.
I'm not sure about china paying for you to buy them, many countries counter that with tariffs. I think those prices are close to natural prices given the enormous scale of china and nearby markets.
Yes, the tariffs counter the artificially low price. At least on the more expensive models, as tariffs aren't a flat fee per car like the subsidies. You're then still left with a workforce that's paid about a third if not a quarter of what they'd be paid in some European countries that manufacture cars.
If we really wanted European EVs to be competitive with Chinese, unions need to be abolished and wages lowered. Unfortunately, we ALSO want people to have good living conditions, so that's sort of a no-go.
ChatGPT says 10-15% of the cost of a typical car is labor
So that would give Chinese manufactured vehicles a 6-10% price advantage
We wish
Okay, now add the labour of every other step of the process too. The 15% is at VW's own factory. But they buy parts from, among others, Bosch and ZF who also have employees producing the parts.
Then also add the labour costs for R&D. BYD's average employee salary in China, including everyone from manufacturing to design to engineering to leadership, was less than half of what the manufacturing plant employees make at VW's German plants and still significantly less than the Bratislava plant. Only top level leadership at BYD gets high salaries.
Which is why VW has been fighting the IG Metall union for the right to close down plants they can't afford to run because their cars aren't expensive enough to be profitable at these labour costs.
It's gonna suck for everyone involved, but that's just what you have to accept if the biggest economy in the world has both super cheap labour AND manufacturing subsidies. It's game over for everyone else unless people are willing to take a major pay cut.
Are you implying Chinese people do not have good living conditions?
I have been in China only a few months working on the assembly line. Work was long and tough, but the pay was good and they'd give you free housing and food. Plenty other workplaces were available if you wanted to work less hours.
How many hours is that about? They don't have 40 hr limit? How about work safety and health insurance? Free healthcare right?
That was 14 hours a day 6 days a week. It was non specialized jobs mostly filled by people getting their first job moving from the farms to the cities. Many people changed job within the first year. 40 hours work weeks were available. Regarding work safety, factories I visited were quite good, modern equipment and practices. I have seen machinery being used quite commonly which would elsewhere be considered highly specialized. Not sure about free healthcare, I did not get to need the hospital.
I'm not saying it's the best country in the world, but in general the people I met were happy and enjoyed a good life without many problems.
China has universal healthcare, at many tiers from zero to half co-pay.
Pension Insurance: Provides retirement benefits after a required number of contribution years (typically 15 accumulative years).
Medical Insurance: Covers healthcare costs. In many cities, this is combined with Maternity Insurance.
Work-Related Injury Insurance (Workers' Compensation): Covers medical expenses, rehabilitation, and disability compensation for occupational illnesses or workplace accidents.
Unemployment Insurance: Provides financial support if you are laid off.
Housing Provident Fund (HPF): A mandatory savings account where both the employer and employee contribute, which can be withdrawn for housing-related expenses like buying or renting a home.
Ew that sounds like the American system. Disgusting.
look at the squalor!
Yes, surely the manufacturing plant employees live in downtown high-rise buildings next to a beautiful park.
Do you want me to post a photo of Central Park or Times Square? That certainly shows how the American manufacturing employees live.
Eu should have taken on Putin's offer while it was being offered - Europe from Lisbon till Vladivostok. Free energy in exchange for technology. Is my opinion. And now it's just too late for both. China is one global winner in all areas .
https://journal-neo.su/2025/09/08/from-vladivostok-to-lisbon-a-counterfactual-geopolitical-analysis-of-eurasias-unchosen-path/
Yea sorry, most of us don't want to live under Russian rule.
I don't think there was a rule in that partnership. And look at it - eu industry is fucking dead.
Lisbon to Vladivostok is a Russian ambition for sure, but not one of partnership lmao, it's an imperial ambition going back to the actual Russian Empire.
US car makers get tax incentives and bailouts, effectively subsidized by the government as well.
The US government doesn't pay Ford to make me, an Estonian, a car so I wouldn't want to buy a Volkswagen.
That's what china does.
Edit: Loving the downvotes.
The Chinese companies get all the same tax incentives, bailouts and R&D grants that western manufacturers do. They're eligible for the same purchase subsidies that western EVs are. They're just also subsidized as a means of economic warfare against western vehicle manufacturers.
It’s a normal tactic
Then why does nobody else do it? Why doesn't Germany pay their manufacturers for every car built?
Nobody except for the world's biggest economy can afford to literally subsidize manufacturing of luxury goods for overseas markets.
https://www.gtai.de/en/invest/investment-guide/incentive-programs-in-germany
https://www.bundesbank.de/resource/blob/706050/925ab0ad3bac1c21abdf12909087f483/mL/2000-12-subsidy-trends-data.pdf
For the us, there was a combination of
See all that is being done in China too but it's not even the issue. The issue is car manufacturers receiving a direct subsidy on all cars produced. Nobody does that and generally selling things for under cost long term is considered illegal because it's a way to establish a monopoly in an established market.
And yet even if that were true, where is the economic policy targeting that? You don’t throw a tantrum and tariff the world, but could do something useful with targeted penalties on one hand and incentives for your own legacy manufacturers on the other. I could be convinced by that
But reality looks a lot more like fear and xenophobia
US federal government spent $85B on US automakers since 2008. State governments more billions. Where's the cheap cars?
The US isn't paying for every car manufactured. The Chinese government has also spent tens of billions in R&D grants and such, we're not even talking about that, we're talking about the simple fact here that if I buy a Chinese EV, China is essentially paying me to do it (or rather, paying their manufacturers to build them), PER car. Not some lump sump investment into their manufacturing years ago.
The US isn't paying their manufacturers every time a new EV rolls off the line destined for another country.
Well maybe neoliberalism was a bullshit economic theory all along and state intervention is actually superior.
For every EV built, Chinese government pays the manufacturer, but it's not exclusive to EVs built for the domestic market. It's EVs built for any market.
That's tens or hundreds of billions each year that the Chinese government could spend on its own people, but instead spends on trying to make western car companies bankrupt.
Is it actually better in some way for Chinese people in their day to day lives if non-Chinese people to get cheaper cars, or is that modern day colonialism, trying to gain more resources in the long term at the expense of people living in other countries?
OK, look buddy, I'm really not a fan of genocidal anti-democratic autocracies, but with your silly arguments you're making me argue for them. Yes, it's good for the average Chinese person. The average Chinese person gets a fucking national heavy industry, with millions of jobs in manufacturing, R&D, services etc. Are we really going to pretend here that does not benefit Chinese workers?
And are we really going to be shedding crocodile tears that it's somehow unfair to us in the West when we have been glazing billionnaire's dicks for the last 40 years of the neoliberal era? We have built an economy on neoliberal fantasies of trickle down economics, we empowered money hoarders to do financial speculation and all it got us is the 2008 meltdown when even fucking Ayn-Rand-fuckboy Alan Greenspan admitted he had the model wrong.
And since 2008, we have concentrated insane wealth in fucking insane billionnaire hoards while our societies suffer under austerity, with no investments in actually meaningful education, in industry, in research beyond bullshit bubble schemes like AI. And now we cry for "colonialism"? Give me a break. Give me a fucking break. We cut our own dicks with fifteen years of austerity and under-investment. And now that the Chinese learned our game and are beating us in our own fucking game, we cry "colonialism"? Colonialism doesn't get anywhere near to what they're doing. Colonialism is what we've been fucking doing for 200 years to the entire Western Hemisphere and Africa. Now we cry "colonialism" when we don't have the fucking balls to build an economy that's not predicated on sucking capitalist dick? Give me a break.
The industry already exists. It's being juiced artificially so they could sell goods to other countries under cost.
Same money could be used for e.g healthcare. China has a pretty US style healthcare system, just a bit cheaper. Instead it's being pumped into private companies that already have a cost advantage before said subsidy.
What they're supporting as a nation is illegal in a lot of places, which is why they're met with tariffs. Which, btw, China also does. They use tariffs too. Dumping is a means of establishing a monopoly.