China versus the world: Heavyweight countries are trying to stop cheap electric cars like the BYD Seal, GWM Ora and MG4 from flooding their streets. Here’s why Australia will be the real winner | Opinion – Car News

The automotive world is at war with Chinese brands like BYD, levelling profit-sinking import tariffs designed to protect existing industries.

Just last month, US President Joe Biden quadrupled the border tax on Chinese electric vehicles from 25 to 100 per cent, essentially erecting a tax barrier to prevent those brands from entering the market.

Speaking on the tax increase, President Biden said they were designed to to not let China “unfairly control the market”, but they also prevent some brands entering at all.

BYD is a prime example. The Chinese new-energy giant had earlier in may described US manufacturers as “not ready” to compete with it.

“They’re not ready,” said Stella Li, chief executive of BYD Americas, told NBC News. “For BYD, we are ready. We are ready for technology, and we are more ready on supply chain.”

But following the tax hike announcement, Li’s position appeared to change, with the executing telling Reuters: “We don’t have plans to go to the US market, so this announcement does not impact us at all. When we build a Mexican plant, we only consider the Mexican market and other countries’ markets, we have not considered the US.”

The move has been mirrored in EU, where on June 12 the European Commission voted to impose duties of up to 38.1 per cent on Chinese EVs across the EU from July.

Interestingly, the European Union set different levies across brands. BYD, for example, faces a tariff of 17.4 per cent, while the SAIC group (which included brands like MG) faces the full 38.1 per cent.

President of the European Commission, Ursula von der Leyen, said prices of Chinese cars were “kept artificially low by huge state subsidies” allowing international markets to be “flooded”.

But while other markets are closing their doors through taxes, Australia’s remain wide open, courtesy of this country’s free-trade agreement with China, and the lack of a local industry to protect.

Far from rallying against them, our Federal Chamber of Automotive Industries describes China’s arrival in Australia as offering “enhanced consumer choice, allowing Australians to purchase cars that best fit their work, recreation, and family”.

China is now the third biggest country of origin for all new cars in Australia, behind only Thailand and Japan, while 72,342 of the 86,828 electric cars sold in Australia last year came from Chinese factories.

GWM Ora (Image: Chris Thompson)

There’s no doubting that the rise of Chinese brands in Australia is lowering the cost of entry into an EV in this market.

The three cheapest electric vehicles in Australia – the BYD Dolphin, the MG4 and the GWM Ora – are all Chinese, and, thanks to a recent price drop, the Dolphin now opens at $38,890.

Either reactively or through coincidence, other established car makers are dropping their prices, too, with the Renault Megane E-Tech, the Peugeot e2008, the Polestar 2, the Ford Mustang Mach-E and the Tesla Model Y all receiving significant discounts this year.

Renault Megane E-tech (Image: Glen Sullivan)

Affordable electric vehicles, not just from China but from all brands, appear to be symptomatic of this increased competition, and arrive in stark contrast to the price of ICE vehicles, which have only been going up in recent years.

If that continues to be the case, then Australia, and specifically Australian new-car buyers, are the real winners of this international trade war.