Ford has presented its business figures for the third quarter. The US manufacturer once again posted high losses for its electric car division - 1.2 billion dollars in the period from July to September.
I’ve been wondering with how much Ford’s CEO has been praising Chinese electric cars lately if he’s not angling to get government support from the US/Canada and EU for similar subsidies, and I wouldn’t be surprised to see it happen at some point for American and European carmakers, probably Japan and Korea also, although subsidies might come too late. It’s one thing to say the Chinese government subsidies in cars and raw materials violate things like trade laws, but there’s also the practical result that Chinese cars are rapidly becoming dominant in lower income economies, squeezing out established manufacturers and potentially in the long run letting them beat the big companies even on their home turf, even in the face of protectionist tariffs and other measures. At the end of the day if an electric car is cheaper to buy and cheaper to operate, customers will start voting with their wallets no matter how much they might say they love gasoline. A lot of Americans used to hate on Japanese cars as inferior to what Detroit made, but they were a lot cheaper, and cheaper to repair, and cost less to fuel, and over the years quality improved, and now look at how big Toyota and Honda and others are. Same with Korea and now look at Hyundai and Kia. In the same time period look how many smaller American and European brands have disappeared, and how much smaller Detroit’s market share has become. It’s likely to happen again with Chinese electric cars.
I’ve been wondering with how much Ford’s CEO has been praising Chinese electric cars lately if he’s not angling to get government support from the US/Canada and EU for similar subsidies, and I wouldn’t be surprised to see it happen at some point for American and European carmakers, probably Japan and Korea also, although subsidies might come too late. It’s one thing to say the Chinese government subsidies in cars and raw materials violate things like trade laws, but there’s also the practical result that Chinese cars are rapidly becoming dominant in lower income economies, squeezing out established manufacturers and potentially in the long run letting them beat the big companies even on their home turf, even in the face of protectionist tariffs and other measures. At the end of the day if an electric car is cheaper to buy and cheaper to operate, customers will start voting with their wallets no matter how much they might say they love gasoline. A lot of Americans used to hate on Japanese cars as inferior to what Detroit made, but they were a lot cheaper, and cheaper to repair, and cost less to fuel, and over the years quality improved, and now look at how big Toyota and Honda and others are. Same with Korea and now look at Hyundai and Kia. In the same time period look how many smaller American and European brands have disappeared, and how much smaller Detroit’s market share has become. It’s likely to happen again with Chinese electric cars.