The withering dream of a cheap American electric car

I would love a 10-15K BYD. I was told recently desiring a BYD is un-American when I can spend 3 times the price on a Tesla. No thanks! I’ll hold out for something truly cheap. Cars in America are insanely priced.

Funny thing is that Musk himself said the “Shanghai built Tesla's are the best quality Tesla's” and he’s fully leaning into Chinese manufacturing.

I suspect what will happen is that cheap Chinese imports will come into the USA but only for select manufacturers who benefit the current administration. So no cheap byd’s but possibly cheap Tesla’s.

Protecting local manufacturers from cheap offshore labor is rational, especially if the offshore products are being subsidized specifically to undermine incumbents and put them out of business. I get that individual consumers want the cheapest trinket they can find, but the gov't has to be more strategic. And every country does this, including the one that would be the source of these trinkets.

Subsidy cannot work beyond a certain scale. Sure they may have benefitted initially, but in the long run I presume they need some kind of profits to sustain.

May be the lead in Chinese EV and battery industries is not purely technological, it is also the supply chain and scale developed over the years.

All this talk assumes that USA or Western countries have always had a level playing field whereas companies like Boeing or Airbus are prime counter examples

> All this talk assumes that USA or Western countries have always had a level playing field whereas companies like Boeing or Airbus are prime counter examples

As I said, every country does it. It is rational to protect your own manufacturing industry. China does it. We do it. European countries do it. Just because we protect our own industry does not mean we have to protect China's interests too. That's their problem.

Absolutely! The biggest problem is the average American allows themselves to be duped and challenged by advertising. New tech in cars is great, but spending $40K and up is stupid. I've said it before: my $27K base model Ram truck will go from point A to point B just as well as a $70K(!) model. Is it just as shiny? No, but the money I didn't spend on all that shine won't be wasted on depreciation.

My credit union recently sent me an email telling me I can be approved for up to $70K for an auto loan, this is insane! When we allow competitiveness or temptation to decide how much money we spend, we lose every time. The only way to get Tesla to offer that $25K car is to stop buying the more expensive ones.

Tesla cars sold in US are the most American build cars. See https://www.carpro.com/blog/most-american-made-vehicle-the-t...

What it means that if you count what percentage of car parts are made in America, Tesla has higher percentage that other brands, even those you might consider "more" American, like GM or Ford. All Teslas sold in America are assembled in America (California or Texas). Ford Mustang, for example, is assembled in Mexico.

As far as I know Tesla never sold Chinese built cars in US. They used Chinese manufacturing (CATL) and Korean batteries in some model, but also manufactured batteries in US (Nevada, with Panasonic) and are expanding battery production in US with 4680 (used in Cybertruck).

Cheaper Teslas are coming to US but they'll be manufactured in US (Texas). Tesla told us that they'll start making a cheaper model sometime in 2025.

Half of America doesn't want to support the incoming administration either, and Musk has decided to closely and personally align himself with it. I wonder if that will affect Tesla sales.

It leads to market separation. No one outside the US will buy US made when they have cheaper Chinese cars as an option. And the US can’t force external competitiveness to emerge with those subsidies in place. Not to mention internally having to buy more expensive transport has knock on effects to the entire economy.

I’m saying that Chinese made teslas might be allowed in the USA in the near future.

Musk himself has stated bluntly that USA made teslas are lower quality and more expensive so you can see the desire to shut down the US plants and bring in Chinese made Teslas and he clearly has some political sway now.

Do you think this argument applies to microprocessor manufacture?

I kinda think the whole thing is just Elon tricking republicans into buying electric cars.

No, they do not need long term profits to sustain, at least in certain regimes.

Masterful move right there. Maybe he can trick them all into going to Mars next? They don't call it the Red Planet for nuthin.

The only difference between the vast majority of cars "Made in the USA" is the scant margin that allows manufacturers to use that mark. Most cars are made outside the USA. So, as far as I'm concerned, they are all basically un-American. That's beside from the point that Tesla is being run by a Nazi.

The problem is that the US is complaining a lot about that when it is the other countries doing that. Even here, average commentator will call it a foul (whataboittism) if you point out that.

You can't eat the cake and have it. Either you follow the fair trade requirements or don't complain about others not doing the same. If you say standards, then follow by lead and respect them.

Also I do not think every country does that. There are too much pressure by the US, China and EU on these countries to prevent many from doing that.

Un-American or not, those 10k BYDs reflect Chinese supply chains, labor prices, and market subsidies and cars built to different regulations - turns out if they play the game like other manufacturers do, BYDs aren't actually that much cheaper to make.

The only thing locally made is the bare minimum to make it "Made in USA", but everything is heavily outsourced already. There is no point to your argument, as that battle was lost a long time ago.

In a way, that doesn’t matter for the US. Consider that the US has an enormous trade deficit. If the US brought to even, then all those exporting countries with large surpluses would be in bad shape.

This is a complex problem, and when the US is the importer from the world, the mere decision to stop importing would send shockwaves through trade everywhere.

To the extent that those microprocessors are necessary for war, sure.

I’d be surprised if that happened in a Trump-run trade environment.

I know Elon has his ear, but still…

The assembly line process itself is a big strategic value. And just because we don't manage to source every individual part exclusively from USA labor doesn't mean we should just throw in the towel and completely give up on our ability to make machinery.

And American prices are already insanely low. If I want to buy a RAM in Austria for $30k I get a used car with 150.000km. If I want a new one it's (much) over $100k.

Labor prices and subsidies might be "cheating" but why would we count supply chain against them?

I exclusively buy Toyotas because they are cheaper to maintain than American cars. Is your argument that I shouldn't have access to Japanese cars either?

I understand the desire to have a strategic reserve of manufacturing capacity. However, the US also subsidizes the US auto industry heavily by e.g. bailing out GM and Chrysler. It frustrates me that US car manufacturers continue to make exclusively heavy, low-efficiency vehicles. Give me something inexpensive, safe, efficient, reliable, and I'll buy it.

The protectionism there deformed the product and thus, the limited offerings are a result of the inability to compete in these segments.

> Tesla told us that they'll start making a cheaper model sometime in 2025.

Buddy, do I have a bridge to sell you...

Is that why the EV subsidy is getting repealed?

> As evidence look at all of the quickly disproven posts on a wide range of topics that Elon has posted. He did no research at all before posting those things (despite a large following, and thus large responsibility). He "felt" that the post was good/right, so he went with it.

Or, more likely, he knows exactly what he is doing.

Yeah,if you look at the tariffs not as a fixed thing that applies to everyone, but a way to favor select companies and hurt others, I think they make more sense.

Blame the pesky labor and safety laws.

You puff up the local market when you're giving a speech in that market.

Which is good, we don't want electric cars to become a culture war issue

There's also the closing of his factory by the lady that didn't like him during covid, the Biden administration's decision to never mention Tesla, instead proclaiming that manufacturers like GM were making America Electric (Tesla sold way more electric cars, and they are much more American).

What is a "local manufacturer" some other multinational corporation? At least think about your bullshit propaganda before you repeat it.

I think there are a lot of little reasons all combined, and that is definitely one of them.

- Heavy criticism over the past 6 years from traditional news sources (even tech sources like Ars Technica)... basically ever since the Tham Luang cave rescue*

- Thick hate from people in the comments sections

- Government agencies interfering with SpaceX and Tesla

- Biden administration ignoring his carbon tax suggestion

- Biden administration snubbing Tesla at the EV Summit

- His family transgender drama

- COVID mandates shutting down his manufacturing for a period of time

- Conservatives not buying EVs

If you look at all his points of friction in recent years it's not much of a surprise to see the transformation.

*The cave rescue was a sad turning point for Musk. He endured excessive ridicule for pushing for a technological solution, then really stepped in it with his bitter accusations against that rescue diver.

Most (maybe all?) Toyota in the US are actually made in America. If you look at the various "Made In America" indexes that take into account factories, supply chain, etc, the Camry does better than anything from Detroit

> we don't want electric cars to become a culture war issue

Too late. I'm happy to be proven wrong at some point.

All those options and appearance packages just become liabilities as the trucks age. None of it ages well.

The incoming administration has shown contempt for programs created by the "other side". They're strongly against renewable energy in general, and their patrons are oil and gas people.

He wants the tax credit snuffed out to eliminate US competition and tarrifs against imports to eliminate foreign competition.

No tax credit, no Rivian. I can see why he wants that. Their build quality and manufacturing ability trounce the Tesla when they were at that stage. Rivian has full EV vans in production and on the road daily. Impressive as hell.

Have you ever gotten behind a diesel truck with emissions deleted? I have...a lot. The roll coal crowd doesn't have EV on their radar whatsoever.

Nah...

The us of course subsidizes our manufacturing (whatever is left of it), just like many other countries. I don't know if our $7500 tax rebates on locally made EVs with non-chinese batteries compare to Chinese govt subsidies. But it's clear that EVs are going to be much much cheaper to make, maintain, and recycle over time. This is a threat to all kinds of incumbents. We face the destruction of a lot of our manufacturing industrial base if we don't convert some more of it to EVs, and this will also be destabilizing to our politics. Add on the enmity of the gas and oil industry (helped a tiiiny bit by Trump's victory).

The problem is -the us exports one thing en mass- security. And its starting to use that for shakedowns- which is the moment everybody becomes his own sheriff.

I don't remember the source so, someone please correct me if I'm wrong but, I read that no EV battery can be made for less than $50K. So, either BYD is cutting some serious corners (possibly) or they are being heavily subsidized (probably). If either are true, I can see how that would be damaging to us.

> I exclusively buy Toyotas because they are cheaper to maintain than American cars.

I think Teslas are actually cheapest, by brand.

> It frustrates me that US car manufacturers continue to make exclusively heavy, low-efficiency vehicles.

The market has decided that they want cars from Toyota and trucks from Detroit. I can't really blame the automakers from focusing on what makes them the best profit.

I'd dispute the low efficiency claim. My Ford pickup is way more efficient than anything Toyota makes. And even strictly comparing like-for-like, Toyota is on the lower efficiency end of that market.

There have been people who wanted much more protectionism from Japanese autos since the 1970s, esp. since they demonstrated they make great cars for less money and detroit wasn't really interested in trying too hard.

History looked like it was going to repeat with EVs from the US except for Tesla. Now GM has some decent cars across a variety of models, Ford has 2. But neither company has put out any really low priced cars yet (you know, like under 30). Tesla (lead by darth vader) is the only hope for the near future of low priced cars. I think ford and gm will get there eventually. But it could be too late if imports can just come in.

He also had kind of a meltdown during the initial period of COVID isolation when his factories were closed too.

I think it was that double-whammy: both his trans daughter and the threat of COVID shutdowns destroying Tesla happened pretty close to each other. Those combined drove him not just to traditional fiscal conservatism but to the modern populist identity-driven Trump politics.

That and he's visibly obsessed with validation and popularity and going hard-right has given him that in spades. He wants to be cheered-for at rallies the way Trump is... remember the time that Dave Chappelle brought him out on stage in SF and he was greeted with a wave of boos?

I don't know what will publicly get the blame, but I, and I don't think I'm unique in this regard, am not buying a Tesla because of the documented issues the cars keep having: getting bricked, catching fire, being needlessly difficult to escape in an emergency, tons of unfulfilled promises about new features, etc. On top of this, everyone who I knew who had a Tesla never bought a 2nd.

The product deformed due to lack of ingenuity related to the CAFE standards.

I’ve heard replacing an EV sadan’s battery is typically ~$10K (capacity matters of course).

Also, fwiw, our home batteries (sold at profit, with lots of expensive other stuff and install labor) were about $20K, and the same capacity as our small car.

I was nodding along with your post until you brought out your numbers (I agree fully with the broader point). For me, any car above 15k or so is very expensive - I've always bought used and drove them into the ground. I'd love an electric car but it's not in the cards for my family until the total cost of ownership gets down to 2-3k a year or so.

This is something I've always found fascinating about materialism (I can only speak to the US). The messaging and feelings are incredibly similar whether your budget is 10k or 100k. Very easy to slide up the scale slowly and feel like you're still living small with a bulging budget, or to choose options that are beyond your means and so stunt financial growth.

I will never buy an American car. I remember my parents' multiple Dodges and Fords catastrophically failing before they switched to Toyota.

US car companies have created the lasting idea that cars are dead at 100K miles, because those companies' cars absolutely were. Meanwhile, I bought my Honda at 148K and it's over 210K now and doing fine.

Tesla seems to live up to the legendary Ford quality, with hilarious workmanship issues, Ford Pinto level "it'll trap you in a fire" design and frequent failures. Probably because they threw out the hard-learned lessons of a century of auto-making for novelty electronic gimmicks.

Is there a $27k base model ram truck? Seems like the base model on the ram website is $38k and when I tried to price a regular cab one from stellantis fleet those were like $46k, but I could have made a mistake on that site.

I believe it's worth pointing out that with your Toyota, you're still buying an American car. The vast majority of Toyota vehicles sold in America are made in US plants.

Which is a good thing! It shows that those other quality issues are not related to US labor force, or some intrinsic American inability to make high quality goods.

There's some interesting history here. Toyota started manufacturing in North America in the 70s-80s largely due to pressure from the US government in the form of tariffs and import restrictions. For example, from https://en.wikipedia.org/wiki/Toyota_Motor_North_America:

"Toyota’s first manufacturing investment in the United States came in 1972 when the company struck a deal with Atlas Fabricators, to produce truck beds in Long Beach, in an effort to avoid the 25% "chicken tax" on imported light trucks." ... "After the successes of the 1970s, and the threats of import restrictions, Toyota started making additional investments in the North American market in the 1980s. In 1981, Japan agreed to voluntary export restraints, which limited the number of vehicles the nation would send to the United States each year, leading Toyota to establish assembly plants in North America."

The book "The Machine That Changed the World", while a bit dated, gives a great overview of the history of Toyota from US automaker perspective.

If you want something truly cheap, buying a new car doesn’t make a lot of sense. Used cars are a better deal.

> Tesla told us that they'll start making a cheaper model sometime in 2025.

Next, you'll tell me that RoboTaxi is coming within 6 months.

Roadster is now 4 years late and has no release date planned. FSD is how many years late, now?

Tesla is the king of missed timelines and broken promises. I'd be surprised if they even actually had a desire to make a cheaper car. Their claims are just lies to boost the stock price. Margins on a base Model 3 are already incredibly slim.

Well, the big seller is Canadian. RAV4 comes out of Woodstock, Ontario.

Designs, manufactures and sells all in the US. For all intensive purpose, the Japanese exert a rather small influence on the day to day operations

that's the first thing about politics that made me smile in months i think.

The US is subsiding a lot of industries. Aviation, agriculture (specially agricultural exports), transportation and energy. They just introduced CHIPSA act to promote US companies chipa production and a lot more. When china does this (which is does) then this is far cry and outright harmful for international trade. Lets get out of comparison between US and China. Smaller countries will be hit hard (even with sanctions) if they try to do something from that.

The point here is that the US, China shouldn't try to prevent other countries from doing what they are doing and forcing them to harm their local economy and open markets under the disguise of free trade.

> the Biden administration's decision to never mention Tesla, instead proclaiming that manufacturers like GM were making America Electric (Tesla sold way more electric cars, and they are much more American).

This always bugged me.

Look, I'm no fan of Elon Musk, but Tesla has been the most influential car manufacturer in the EV space. To blatantly ignore them when talking about the electrification of cars in America is simply madness.

US cars have not been dead at 100k miles in decades, but people still accuse them of that. I have my Chrysler at 230k miles and still running fine.

Note that many of the "American" cars with the bad reputation are Toyota's with just a different logo. Even though it is easy to check who made the car, the American logo makes for the reputation that it will die in 100k miles.

If you are running $2 trillion deficits, then of course you will have trade deficits. You are an importer of goods and an exporter of USD. The problem will arise when your debt becomes unsustainable and alternatives to the USD emerge for settling international trade. This would lead to a decline in demand for USD, a drop in demand for U.S. debt, and reduced capital inflow into the U.S. stock market (end of recycling), essentially leading to a collapse of the current U.S. economic model.

I don’t know what you’re doing but I have had 3 American sedans (1 mustang, 1 fusion, 1 Malibu) over the past 20 years and they all (2) made it over 200k miles when I sold them with my current one approaching that, nothing but regular maintenance and one time I had to replace shocks/struts on the ford fusion. 200k is when I generally pack it up and get a new car.

intents* and purposes

Most of the Toyotas sold in America and made in America

I'd like to see some real numbers. All to often something gets in the news and so you think there is a real issue while in reality it is no worse than anything else. Statistics are important, otherwise we get lost in our own biases.

It is very common for people to change brands every time they get a new car.

Not always, the lower end Toyotas it’s a better deal per mile to buy new, if you are willing to shop around a little and get last year’s model.

That isn't quite true. They are aware of EV trucks - they won't buy one of course, but they are aware. They spread stories about those trucks not having any useful range (which is true - when pulling a trailer or driving well over the speed limit the EVs lose range) Those diesel trucks they drive get 600 miles unloaded.

> I don't remember the source so, someone please correct me if I'm wrong but, I read that no EV battery can be made for less than $50K.

Absolute hogwash.

The only way for this to be true is if you amortize the cost of R&D and factory building over a small number of batteries and include it in the manufacturing cost, and I think it's incredibly misleading to include the cost of R&D into the cost of a battery, simply for the fact that you can make wild claims by just including it.

So...for an incumbent manufacturer that's putting very little effort into actually selling EVs, it might be true that it's costing them $50K per battery if you include the cost of setting up the manufacturing. But for someone like Tesla, who has literally sold millions of cars, even if you include that cost, it's closer to $10K.

I recently saw a bumper sticker on a Tesla that said "We bought it before we knew how awful he was." Because of Musk, my wife and I will never buy a Tesla even if they do release a basic, low-cost model here in the US to compete with Japanese and Korean economy cars.

On the other hand, as the other comment said about him "tricking Republicans," I think he's also gained a new segment of buyers with his political play, so this might be a wash.

And at this point that would also benefit the US. That mass security is not cheap.

The current average monthly salary in China is $3000-$4000 US dollars. This is not about cheap labour anymore but simple economies of scale.

The whole talk about subsidies is pure smoke screen. US automakers have received a lot more subsidies than their Chinese counterparts. The top chinese firm receiving government subsidies, CATL, got ~$500M USD last year. BYD is said to have received $3.5 billion in total in its lifetime. In the meantime, the US government offered $12B just last year for automakers to start making more EVs, and Ford is reported to have received a total of $33B in loans, bailouts and tax rebates.

In any case, if you could put down $3.5B and get a BYD out, everyone would be doing it, reality is a bit more complex than that.

Used cars are not that much of a bargain. I’ve been looking and asking 20k for a car with 100k plus miles is insanity.

??? The average BYD line autoworker earns $640 to $840 USD a month, but that require overtime; 1.5x pay on weekdays and 2x pay on weekends.

BYD Wuxi workers went on strike in 2021 because BYD was trying to restructure to eliminate overtime, which would effectively drop the workers wage to under $400 USD a month.

We have 2 Chevrolet EVs, a Bolt EUV made in the US and an Equinox EV made in Mexico.

They're great. I have rotated the tires twice on the Bolt and I'm getting some different wipers for the windshield because my wife doesn't like the noise the factory ones make. Oh, and I got floor mats for both cars.

I have Car Play in the Bolt and GM's own system in the Equinox (Android for Autos or something like that, not the standard Android Auto) and they're both fine.

I use SuperCruise whenever I can. That's only on freeways with the Bolt and a lot more other places with the Equinox. I was backseat in an Uber Saturday and it was neat watching the Tesla Model 3's AutoPilot system. Very cool. On the other hand, GM was reporting no accidents with their cars, which include ICE vehicles, too. https://gmauthority.com/blog/2024/02/gm-super-cruise-users-t...

> US car companies have created the lasting idea that cars are dead at 100K miles

OT but, there were clear exceptions to this even back in the bad ol' days. It was common knowledge in the 70s that for certain engines (such as Chevy small blocks), if you cared for the engine (mainly: regular oil changes) you could get 200K+ out of it. The rest of the car was too low-tech to decay, except of course for road salt vs body work.

I get the point, but also he's a much more competent salesman (and, I'm assured, rocket scientist) than he is at basically all the other things he's inadvisably gotten involved with.

So, while I'd bet against Twitter (if I such a thing were possible), I wouldn't bet against Tesla being a good fit for the US market.

European sales may well collapse, and he may be very confused about this, but I'd still expect his approach to do well in the USA.

While not an EV, but a hybrid - I'm the lucky owner of an affordable Ford Maverick little truck. From what I can tell, Ford makes a lot of sweet $$$ selling the F series trucks and does not really care about low margins.

Which is about the same a factory worker in Mexico, building the Ford Mach-E, makes. I imagine the purchasing power in China will be a lot higher.

China currently has multiple times higher costs than countries like Vietnam. Cheap labour is not a major factor anymore.

Sorry, no mistake on your part. I bought the Ram new in 2021. I live in the Tulsa, OK area, where prices are a little more reachable because of so many different dealerships.

Wow, is that because of tariffs or shipping costs from the US?

Your points are well taken. I only bought the Ram because I had to for personal reasons. It's the first new car/truck I've ever owned and I will drive it till it's worn out. I've always bought used/low mileage vehicles to avoid depreciation and the headache of the warranty period.

Car makers make a lot of money based on our egos to one up-our neighbors. Car salesmen are trained to create a competitive atmosphere at the dealership by exposing our vanity and it works!

> The current average monthly salary in China is $3000-$4000 US dollars.

Source, please. I do not believe this.

> Half of America doesn't want to support the incoming administration

Hasn't that been true for every US presidential election?

I don't remember the 90s being this polarizing. Sure, people made fun of blowjobs in the White House, but it didn't feel like we were always on the precipice of civil war and societal collapse. Even Bush and Obama weren't so divisive. Yeah, people always had their political preferences, but there used to be such a thing as a shared American identity to some degree, especially in the post-9/11 years. Not these days.

As an independent, it's especially discouraging. I don't see many level-headed voters or politicians anymore, and a lot of the basic governmental services and protections seem to be collapsing while we focus on culture wars. We can't even work together as a country to discuss something as boring yet important as energy policy. Who knew battery-powered cars could be so divisive. Everything is weaponized now.

Which is fine. Deleted trucks are already illegal, and soon enough you won’t be able to buy a new ICE vehicle. They will be gone in my lifetime.

Yeah doesn’t look true, median is more like $800 for those in private companies.

https://finance.sina.cn/2024-05-19/detail-inavuhsp2237661.d....

I think the Cybertruck has a lot of crossover appeal.

That report says averages are $1381/month (120k RMB/year) for "non-private" employees, $800 for private (?), $3000/month in IT, $1500/month in mining. You happened to pick the lowest number.

There seem to be wildly different numbers reported online, but from a more thorough search it looks like the national median is indeed around ~$1400, while the 3k-4k range I mentioned is specifically for the Shangai area.

Aside from being useless? That truck is a toy, nothing more. You better have a backup vehicle.

America just overwhelmingly voted to go back in time.