BYD's EV Dream May Be Legacy Automakers' Nightmare

https://spectrum.ieee.org/byd-ev-china-supercar

by mfiguiere • 2 years ago

12 11 2 years ago

spectrum.ieee.org

parl_match2• 2 years ago

Legacy carmakers are caught on the back foot, for sure, but EV technology is still so early in its modern incarnation that I wouldn't count them out quite yet. In significant, non-urban markets, gas/hybrid is still the dominant technology.

Not to mention: BYD car sales are substantially subsidized as part of China's own push for energy independence. The prices you see in these articles are often Chinese market prices, translated to USD - they're mis-representative.

Don't get me wrong, they are going to give legacy carmakers stiff competition, but these headlines often gloss over critical details.

astkaasa• 2 years ago

You can use price of Tesla cars as an indicator. It's about 30 - 50% cheaper in China than in US. Depends on different time/sale and different models.

ClumsyPilot2• 2 years ago

«> BYD car sales are substantially subsidized as part of China's own push for energy independence.

Are they really? The established narrative does not add up.

I keep hearing ‘China subsidised Steel, energy, batteries, solar’. At this point it’s easier to list things they don’t subsidise?

How is it possible that they subsidise everything and have a budget surplus, and we subsidise nothing and are in deficit?

I am not sure if this is a misunderstanding of economics or just anti-china PR campaign, but all of the above cannot be true.

dogma1138• 2 years ago

The automotive industry is one of the most subsidized industries in the west both directly and indirectly, and that is when you don’t account for the massive bailouts that happen every decade or so.

I have also yet to see anything of substance that compares subsidies between the US, Europe and China.

All I know is that the VW ID.3 which starts at €40,000 here in Europe can be had as cheap as $16,000 in China.

The prices of new cars whether they are EV or ICE at least in Europe was been inflating well past inflation over the past 10 years or so.

Base trims are getting harder and harder to the point of near impossible to find at dealerships and the cost of basic addons has inflated to the point in which the most economical buy tends to be the top of 2nd to top trim level which is usually now 25-30% more expensive than the base price.

parl_match2• 2 years ago

Yes, they are. China specifically gives massive discounts and the PRC even directly interferes with pricing strategy for entry level vehicles - after all, they own the company. This is pretty well documented.

In the west, we also subsidize, but we generally subsidize new developments that hit our goals. Our goals in the west are not "EVs at any costs", unlike china, who is dependent on other nations for oil and gas.

And, part of how they "subsidize everything" is that they own everything, they have the ability to extract more value from companies and give it to other companies to achieve their goals. This can backfire, and has downsides, as seen with their real estate crisis.

Also, talking about budget surplus really understates the important role that debt plays in most governments.

So I'd say it's a few things

- China has a massive incentive to switch to EV, one that we in the west can't even imagine. They are willing to forgo profit in their car industry if it means they can reduce reliance on Russia and US-involved oil sources. This is EXTREMELY well documented.

- Solar and batteries are part of their desperate struggle to not rely on Russia. They are building massive storage tanks to store cheap Russian oil - the war in Ukraine has been a blessing for China and has put them in the uncomfortable seat of wanting to prolong the war for as long as possible. I'm not saying that they are doing anything to, just that there are incentives. To be honest, China is very reticent to get involved in matters like this, and I don't blame them.

- China's subsidized steel came from their massive need to build housing for their population, which ties into the next point.

- You misunderstand the economics involved (as judging by the way you talk about budget surpluses). The simple reality is that China operates unlike anything in the west. I don't think this is a bad thing, necessarily, and it's certainly helped raise (at least) half a billion people out of poverty.

So, everything you said "can't be true" or is "propaganda" is actually pretty reasonably explained by their explicit domestic policy and actions. I don't think they're particularly acting maliciously or trying to "start shit", they're just playing hard on the field. And they have every right to, tbh.

xnx• 2 years ago

In significant, non-urban markets, gas/hybrid is still the dominant technology.

FWIW BYD has hybrid models too: https://en.wikipedia.org/wiki/BYD_Qin

rstuart4133• 2 years ago

This is an example of where the West's patent system is its undoing. Lithium batteries were invented in the West and manufactured first in the West. In particular LFP which is what BYD is based on (they say their batteries should get around 25 years) hasn't been made in significant volumes in the West. That's because they were patented, and the patent was vigorously enforced.

Meanwhile China ignored the patents. They could not sell to the West but grew their volumes due to internal sales. So now they have large economies of scale and the West is 20 years behind. Or to borrow the term used in the article, "on the back foot".

The patent system has been a mess for most of my working life. 20 years might have been appropriate for the rate of technological development 100 years ago and perhaps it's appropriate for pharma now, but it's far too long for most types of engineering.

The funny thing is, AI might be the cure as apparently we aren't going to let AI inventions be patented.

tooltalk• 2 years ago

The US had its own LFP manufacturing pioneer, A123, but the company struggled with mass production and was sold to a Chinese company after factory fire and manufacturing defects, which IMO would have been tolerated in China.

So it's not just the patent system that is holding back the West. China was also able to get ahead in the battery race by blatantly ignoring the international trade rules under China's WTO obligation against illegal gov't "export subsidies," "local content rules," "forced IP transfer" via "forced joint venture," or outright ban on foreign competitors to protect local, weak players like CATL/BYD. China hasn't necessarily been too shy about their mercantilist ambition past 10 years, aka Made-In-China 2025.

natch• 2 years ago

Maybe it sounds great sitting in a modest house in Omaha, but they won’t get far without a charging network.

sandworm101• 2 years ago

The new and shiny cars always look better than everything else. I want to see how these Chinese cars look in 5/10 years, when I might be interested in buying one. A reasonable new car (ie Honda/toyota/bmw) should last 20+ years. I just don't see that in these Chinese cars. I question whether they will be making parts in even five years.

ClumsyPilot2• 2 years ago

Chinese cars aside, if you want to go electric, do it now. My father has been telling me that he wants an electric car, but is waiting for the next gen. He’s been telling me that for the past 10 years. My mother was like, this is stupid, bought an old BMW i3 and she couldn’t be happier. There is no time like the present.

BYD's EV Dream May Be Legacy Automakers' Nightmare

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