The US government is getting increasingly concerned about Chinese players’ potential to dominate the nation’s electric vehicle industry with their low-cost offerings, the Energy Secretary declared at an Axios event in Washington.
Energy Sec warns the EV industry of potential Chinese dominance
US Energy Secretary Jennifer Granholm warned that China’s substantial electric vehicle imports can hamper the government’s efforts in establishing a strong manufacturing industry through the Inflation Reduction Act.
“We are very concerned about China bigfooting our industry in the U.S. even as we are building up now this incredible backbone of manufacturing.”
US Energy Secretary Jennifer Granholm
The growing concern about Chinese electric automakers’ growth in the US market comes as vehicle exports continue to drop, prompting local brands like General Motors and Ford to reduce internal operations.
“We saw this happen in the solar industry … there was a flooding of the market.”
US Energy Secretary Jennifer Granholm
China’s automotive and EV industry expansion
The US government’s concern is unsurprising, considering how Chinese vehicle exports substantially grew in 2023. According to China Association of Automobile Manufacturers data, China’ exported almost 5 million vehicles last year. This remarkable vehicle export figure enabled China to beat Japan as the world’s largest car exporter.
In addition, Chinese electric automakers have continuously launched new offerings to increase their presence in the global market.
“China is investing massive amounts for the purpose of bigfooting so we need to understand that it is important for people to buy EVs in an affordable fashion but we can do that and we can keep our country safe.”
US Energy Secretary Jennifer Granholm
US’ proactive approach
Biden-Harris Administration previously announced that the US was investigating Chinese vehicle imports’ potential to risk national security. These vehicles can apparently accumulate sensitive data about American citizens and even infrastructure, which they can send to China.
“China’s policies could flood our market with its vehicles, posing risks to our national security. I’m not going to let that happen on my watch.”
US President Joe Biden said in a statement
In addition, the US government is also seeking to solidify its domestic electric vehicle industry with the establishment of reliable supply chains, substantially cutting the nation’s reliance on China through the Inflation Reduction Act’s Foreign Entity of Concern policy.
“We also know if it’s built in America and with the incentives through the Inflation Reduction Act, we can get those price points down and we have seen doubling of EV uptake last year and more of that is projected.”
US Energy Secretary Jennifer Granholm
As EV-a2z previously reported, EV models with battery components built or assembled by a FEOC (China, Iran, North Korea, and Russia) lose access to federal tax credits of up to $7,500.
