Once chinese brands become commonplace everywhere, tradional carmakers will have a hard time taking back market share. In Europe they closed or are closing the last HCOL factories, killing any remaining brand loyalty.
A larger question is how much the cheap Chinese cars are dependent on a long chain of government subsidies from the mines to the local infrastructure and what happens when China's investment driven growth cycle comes to an end. If the solar panels are any comparison, the Chinese automakers are losing a lot of money despite grandiose subsidies.
That support did total some US $231 billion over 14 years from 2009 through until 2023.
You can see more at: https://www.csis.org/blogs/trustee-china-hand/chinese-ev-dil... (June 2024)
There are at least two different ways to interpret the data on industrial policy support for EV makers.
China’s trading partners could point to 15 years of sustained regulatory and financial support for domestic producers, which has fundamentally altered the playing field to make it much harder for others to compete in China or anywhere else where Chinese EVs are sold.
By contrast, defenders of China could point out that the data show that subsidies as a percentage of total sales have declined substantially, from over 40% in the early years to only 11.4% in 2023, which reflects a pattern in line with heavier support for infant industries, then a gradual reduction as they mature.
In addition, they could note that the average support per vehicle has fallen from $13,860 in 2018 to just under $4,800 in 2023, which is less than the $7,500 credit that goes to buyers of qualifying vehicles as part of the U.S.’s Inflation Reduction Act.
The first two (and maybe part of the fourth) I can understand, but the rest are too much of a strech to count as a government subsidy. Every government builds roads and other car-related infrastructure. Every government purchases vehicles for its own use. Every government subsidizes R&D in new fields.
Dacia did force other european auto makers to maintain at least one low cost ish model. Not an entire brand but still. Sometimes just for the eastern european market. Skoda Rapid comes to mind.
But even Dacia is succumbing to the auto manufacturer mindset. Every year the models get larger, more default features are added and the cars get more expensive.
The article is specifically about the US market, which because of the tariff situation is becoming highly distorted. The local producers are making what are increasingly US only models that can't really compete internationally. This excludes mass produced small cars because they can't do them competitively any more as that would require high volumes and export markets. But mostly US car makers are struggling with export markets. There are a few exceptions to this of course.
In China, the competition is pretty brutal right now and it's starting to spill over to other markets. That's all about budget cars and redefining what a budget car actually is. Any export markets where US manufacturers still have any ambitions are being affected by this. BYD and other Chinese manufacturers are gaining market share (at the cost of other manufacturers) all over Asia, Central and South America, Australia, Africa, Europe, etc. Even Mexico and Canada are not off limits and these are the primary export markets for GM and Ford.
Small cars are booming everywhere. Except the US.
Problem is, we'll probably never let Chinese vehicles in as it is an existential threat to the US auto industry. It's odd because we allow Japanese, Korean, etc. but we have political beef with China as a global power rivaling ours.