Prospect of Chinese EVs coming from Mexico worries US automakers

By | 06/28/2024 06:14 AM EDT

The U.S.-Mexico-Canada Agreement could let low-priced Chinese autos assembled in Mexico enter the United States, either duty-free or at a nominal 2.5 percent tariff rate.

A Seagull electric vehicle from Chinese automaker BYD for test driving is parked outside a showroom in Beijing on April 10, 2024.

A Seagull electric vehicle from Chinese automaker BYD is parked in Beijing on April 10. It sells for just $12,000 in China. Ng Han Guan/AP

WASHINGTON — It’s a scenario that terrifies America’s auto industry.

Chinese carmakers set up shop in Mexico to exploit North American trade rules. Once in place, they send ultra-low-priced electric vehicles streaming into the United States.

As the Chinese EVs go on sale across the country, America’s homegrown EVs — costing an average of $55,000, roughly double the price of their Chinese counterparts — struggle to compete. Factories close. Workers lose jobs across America’s industrial heartland.


Ultimately, it could all become a painful replay of how government-subsidized Chinese competition devastated American industries from steel to solar equipment over the past quarter-century. This time, it would be electric vehicles, which America’s automakers envision as the core of their business in the coming decades.