Soaring sales send China EV Stocks sky-high As US And EU automakers’ Shares get shaky
One sign of the success of China EV companies in their own country and rising success elsewhere is the return it has given investors. For fossil fuel auto manufacturers, the opposite is true.
Great Wall Motor is among the largest EV companies in China. Its shares are up 38% this year. The stock of industry giant BYD is up 32%.
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By contrast, Ford shares are down 9% and VW’s have dipped 38%. For the most part, the Chinese competition has hit Europe-based countries hardest because their tariffs on Chinese cars are lower than in the U.S., where it’s 100%. “Carbon targets and cheap Chinese competition are forcing European carmakers to brace for an ‘EV winter.’” Semafor writes. However, earlier this month, EU member states narrowly backed import duties on Chinese-made EVs of up to 45%, meant to counter what the European Commission says are unfair subsidies from Beijing.
Over time, though, Chinese car companies will do as much damage to U.S. manufacturers as they have started to do in Europe. The process, as a matter of fact, has already started in China. Ford and GM both made large amounts of money in China for decades, but their sales have dropped sharply because of the demand for EVs.
Will the Chinese be able to crack the U.S. market? That is a political and not economic question.
Ford management has already said Chinese EV manufacturers could cripple the No.2 American car company in its own backyard.
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