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Reuters Events-US automakers urged to innovate despite tariffs on Chinese rivals

investing.com 23/10/2024 - 18:39 PM

U.S. Automakers Warn Against Complacency

By Nora Eckert and David Shepardson

DETROIT (Reuters) – Leaders from American automakers and their suppliers expressed at a Reuters event in Detroit that complacency is not an option, especially with current tariffs on Chinese competitors providing temporary relief.

Companies like BYD in China are rapidly advancing in low-cost, battery-powered vehicle technology, significantly outpacing U.S. offerings. Executives emphasized the urgency for American companies to innovate and act decisively.

Peter Rawlinson, CEO of electric-vehicle startup Lucid, views the competition with China as a technology-driven battle, given the challenges the U.S. faces in matching Chinese cost efficiency. He notes that while Chinese companies excel in various battery chemistries and autonomous driving integrations, they lag behind in what he considers "core EV tech."

Despite some gratitude among auto executives for the Biden administration's tariff policies, concerns exist, notably from Stellantis CEO Carlos Tavares, who sees potential pitfalls. ZF’s North America president, Ramiro Gutierrez, emphasized the necessity of tariffs, claiming their absence would threaten U.S. competitiveness.

The U.S. government is enhancing its protective measures for domestic industries. The Biden administration's proposal to ban Chinese connected-car technology aims to limit imports from Chinese automakers globally, marking a strong stance against foreign competition. Recently, steep tariff hikes, including 100% duties on electric vehicles, were implemented to shield strategic U.S. industries.

U.S. Energy Secretary Jennifer Granholm acknowledged the competitive threats posed by foreign entities wanting to control supply chains and exploit U.S. innovations. She reassured attendees that the U.S. government is prepared for the challenge, highlighting incentives for EV, battery production, and semiconductors.

Republican presidential candidate Donald Trump also supports imposing tariffs to block Chinese automakers from exporting to the U.S. from Mexico.

Danny Shapiro from Nvidia noted that China's proactive investment in software capabilities contrasts with Detroit's focus on costs. He pointed out Nvidia's success in compliance and product design that meets Chinese company needs despite U.S. restrictions. Shapiro affirmed that Nvidia’s automotive products continue to be unrestricted by these regulations.




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