Tariffs Will Ruin EVs
Selling EVs in the US is hard enough already. People who do not like Elon Musk won’t buy Teslas. EVs are expensive when compared to most gas-powered cars. People are worried about the range and the number of charging stations. The newest problem for EV companies is that they won’t have any inventory.
According to Axios, “Simply put, the U.S. can’t build EVs without China.” Much of this concerns the minerals used in batteries, which China often processes.
EV sales were 8% of all new car sales last year in the US. Adoption has been slow and led almost entirely by Tesla. It had over 75% of the EV market three years ago, but that dropped to 44% in the first quarter.
EV Losses At Auto Companies
The companies that face the greatest losses have already lost billions in EV production, marketing, and technology. Ford, for example, will lose $5 billion to $5,5 billion on EVs in the US this year. It has well under 10% of the EV market. If its ability to build EVs is hampered, recouping those losses will soon be impossible.
The US has placed 100% tariffs on Chinese EVs. While that may protect Ford and GM, it means that if domestic car companies cannot build EVs because of battery material shortages, EV inventories in the US could be close to exhausted by the end of this year.
No one would believe that the US’s market share of gas-powered cars would begin to increase. Based on tensions with China, the reign of the gas-powered car is not over, nor will it be soon.
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