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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

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BYD Dolphin
Andrew Chesterton
Contributing Journalist
24 Jun 2024
4 min read

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."

BYD Dolphin (Image: Tom White)
BYD Dolphin (Image: Tom White)

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".

MG4 (Image: Tom White)
MG4 (Image: Tom White)

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)
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)
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.

Andrew Chesterton
Contributing Journalist
Andrew Chesterton should probably hate cars. From his hail-damaged Camira that looked like it had spent a hard life parked at the end of Tiger Woods' personal driving range, to the Nissan Pulsar Reebok that shook like it was possessed by a particularly mean-spirited demon every time he dared push past 40km/h, his personal car history isn't exactly littered with gold. But that seemingly endless procession of rust-savaged hate machines taught him something even more important; that cars are more than a collection of nuts, bolts and petrol. They're your ticket to freedom, a way to unlock incredible experiences, rolling invitations to incredible adventures. They have soul. And so, somehow, the car bug still bit. And it bit hard. When "Chesto" started his journalism career with News Ltd's Sunday and Daily Telegraph newspapers, he covered just about everything, from business to real estate, courts to crime, before settling into state political reporting at NSW Parliament House. But the automotive world's siren song soon sounded again, and he begged anyone who would listen for the opportunity to write about cars. Eventually they listened, and his career since has seen him filing car news, reviews and features for TopGear, Wheels, Motor and, of course, CarsGuide, as well as many, many others. More than a decade later, and the car bug is yet to relinquish its toothy grip. And if you ask Chesto, he thinks it never will.
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