I think this is probably much closer to the core of the issue than simply comparing Chinese and American wages. A car isn't just the labor cost of the people doing final assembly. It's batteries, power electronics, semiconductors, motors, castings, software, logistics, suppliers, tooling and the speed at which all of those things can be developed and scaled. That's also why Brazil and Europe are becoming such interesting experiments. Chinese manufacturers are increasingly moving final assembly outside China. In Brazil they're taking over or reusing existing factories and hiring Brazilian workers. In Europe, BYD, Chery, Geely, Dongfeng and Leapmotor are all moving toward some form of localized production. So over the next few years we're going to get much better evidence about this. If their advantage disappears as production localizes, then Chinese labor costs and domestic industrial conditions were doing most of the work. But if much of the advantage survives, then the supplier ecosystem and manufacturing organization you're describing become much harder to ignore. E para o TurkeyBLTSandwich, eu usaria: This is the part of BYD that I think gets overlooked when the discussion becomes only about subsidies and wages. BYD isn't just taking a conventional Western automotive supply chain and paying the assembly workers less. It has built a much more vertically integrated industrial structure around batteries, electronics, powertrains and vehicle production. That doesn't mean the model is automatically superior or that its current advantage will last forever. American manufacturers can reinvest, reorganize supply chains and bring technologies back in-house. But that's exactly why I think competition matters. We're now seeing Chinese manufacturers take that manufacturing model outside China. Brazil is already getting locally produced Chinese vehicles, and Europe is moving rapidly in the same direction. Once those cars are being made by Brazilian or European workers, the wage explanation becomes easier to separate from the manufacturing-system explanation. That's the experiment I'm interested in watching.

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That's a legitimate risk to consider, but that's also why I keep proposing local production rather than unrestricted imports. Require BYD or any other Chinese automaker entering the US to build locally, employ American workers, comply with US labor, safety and environmental rules, and make its corporate structure and subsidies subject to the applicable US trade and competition rules. Then the “they're only cheap because China subsidizes exports and pays Chinese wages” hypothesis becomes much easier to test. Brazil is already giving us an imperfect version of that experiment. Chinese companies that arrived here 15+ years ago didn't automatically succeed. Chery struggled badly in its early years but stayed, localized and eventually partnered with CAOA. JAC initially had a much stronger launch, but its passenger-car operation later shrank dramatically. Now BYD, GWM, Chery and Changan are localizing manufacturing in Brazil and employing Brazilian workers, while competing against GM, VW, Stellantis, Toyota, Hyundai and others that also manufacture here. If the business model really depends on permanently selling cars below cost, localization won't magically make that sustainable. But if Chinese manufacturers can eventually make money producing locally while still offering competitive prices, then we have to consider another explanation: maybe part of the advantage actually comes from manufacturing efficiency, batteries, vertical integration, platforms, procurement and scale. That's exactly what I want to find out. I don't want American workers flipping burgers either. I want to know which manufacturing system can employ them while producing globally competitive cars.

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One thing I think is missing from this discussion is that Brazil has already been through an earlier wave of Chinese automakers, and it shows that being Chinese, having lower manufacturing costs or offering more equipment does not automatically guarantee success. Chery entered Brazil in 2009, long before the current EV boom. Its first attempt was not particularly successful. The cars could offer a lot of equipment for the money, but the products, powertrains, dealer experience and overall strategy were not yet sufficiently adapted to Brazilian conditions and consumer expectations. Several early models disappeared. But Chery stayed. It built a factory, accumulated experience and eventually partnered with CAOA, a Brazilian automotive group with decades of experience in the local industry. CAOA had previously built its business through Ford dealerships, imported Hyundai vehicles and eventually manufactured Hyundai vehicles in Brazil. The result is that today's CAOA Chery is almost unrecognizable compared with the Chery that entered Brazil more than 15 years ago. And now CAOA is doing something similar with Changan. Changan is a separate Chinese automaker, but CAOA is using its Brazilian industrial and commercial infrastructure to manufacture and sell Changan products here as CAOA Changan. That is important because this competition is no longer limited to cheap imported EVs. Chinese-designed ICE, mild-hybrid, hybrid and plug-in hybrid vehicles are increasingly competing with traditional manufacturers too. JAC is a useful counterexample because its history went almost in the opposite direction. JAC entered Brazil in 2011 with a huge marketing campaign, quickly established a large dealer network and initially sold quite well. It promised Brazilian manufacturing, but that passenger-car factory never materialized. Over time its light-vehicle operation shrank dramatically and most of that original dealer footprint disappeared. So Brazil has already demonstrated something important: Chinese origin alone doesn't guarantee success. Chery initially struggled, stayed, learned, localized and found a strong Brazilian industrial partner. JAC had a much stronger initial launch but failed to establish the same industrial footprint and eventually became a much smaller player. Now we're watching a much larger second wave. BYD took over Ford's former industrial complex in Camaçari. GWM took over Mercedes-Benz's former factory in Iracemápolis. Renault and Geely are expanding their industrial relationship. GM itself is assembling Chinese-developed Chevrolet EVs in Ceará through products originating from its Chinese ecosystem with SAIC and Wuling. Toyota and BYD have a 50/50 EV R&D joint venture. Tesla complicates the story even further. Tesla is one of America's biggest automotive technology success stories, but its battery supply chain has always been international. Panasonic was fundamental to its early scale, while its later battery sourcing expanded to suppliers including LG Energy Solution and CATL. So the modern auto industry is already much more interconnected than “Chinese technology vs American technology” suggests. And this is why I find the comparison with Japanese and Korean automakers so interesting. Foreign manufacturers don't necessarily remain importers forever. They enter a market. Sometimes they fail. Sometimes they learn. They change products, establish dealerships, find local suppliers, partner with domestic companies, hire local engineers and workers, and eventually manufacture locally. Brazil watched Japanese and Korean companies go through versions of that process. Now we're watching Chinese companies do it. And localization gives us a much better experiment for the question this thread started with. If BYD, GWM, Changan or another Chinese manufacturer loses most of its price advantage after producing in Brazil, Europe or eventually the US with local workers and local regulations, then Chinese wages, subsidies and domestic production conditions were clearly responsible for a large part of that advantage. But if a significant advantage survives localization, then wages cannot be the whole explanation. Battery costs, vertical integration, platform architecture, supplier organization, procurement, automation, manufacturing scale, development cycles and margins all become part of the answer. That's why I don't think the most interesting experiment is simply importing millions of Chinese cars into the US. Make them manufacture there. Make them employ American workers. Make them comply with American safety, labor and environmental rules. Then compare the products. Brazil is increasingly doing exactly that experiment with Brazilian workers. And after watching what happened with Chery and JAC over the last 15+ years, I wouldn't assume the result in advance. Localization can expose weaknesses just as easily as it can expose advantages.

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There is another part of this discussion that makes the whole “Chinese auto industry vs American auto industry” framing much less clean than it sounds. Tesla itself is a good example. Tesla is American, but its battery supply chain has never been purely American. Panasonic was crucial to Tesla’s early scale, and Tesla later diversified its battery sourcing to companies including LG Energy Solution and CATL. So even the most successful American pure-EV manufacturer was built around a global, heavily Asian battery supply chain. Brazil makes this even more interesting because we are watching several versions of this industrial integration happen at the same time. BYD took over Ford’s former industrial complex in Camaçari and is progressively localizing production. GWM took over Mercedes-Benz’s former factory in Iracemápolis. Renault and Geely are expanding their industrial relationship in Brazil. GM itself is now assembling Chinese-developed Chevrolet EVs in Ceará. The Spark EUV and Captiva EV come from GM’s Chinese industrial ecosystem with SAIC and Wuling and are being assembled locally. Toyota and BYD have a 50/50 EV R&D joint venture. Nissan has had a major industrial relationship with Dongfeng in China for decades. At some point, asking whether a technology is simply “Chinese” or “Western” stops having an easy answer. And Brazil gives us another interesting experiment: range. If you look only at Brazilian homologation figures, some EVs can look surprisingly short-legged. Cars with batteries in the 50-60 kWh range can receive official Inmetro/PBEV range figures around 300 km. But the Brazilian number is deliberately conservative. Inmetro does not simply publish the raw laboratory result. Adjustment factors are applied to produce a more conservative real-world reference. The problem is that a lot of automotive discussion here then treats that number almost as the maximum distance the EV can realistically travel. Owner experience often looks very different. We now have EV owners driving these cars across Brazil, including mountainous areas and routes that climb from the coast onto the plateau. There are owners and independent tests substantially exceeding the official Inmetro range, and under favorable conditions some results get much closer to WLTP. Larger-battery EVs can exceed 400 km in real use even when their Brazilian homologated number looks much less impressive. Obviously that does not mean WLTP is guaranteed real-world range. Drive at 120 km/h, climb continuously, add headwind, temperature changes or heavy HVAC use and consumption changes dramatically. But this exposes an interesting asymmetry in how cars are discussed here. When a small 1.0-liter ICE car achieves an exceptionally good km/l result, automotive enthusiasts and media are perfectly happy to show what the car can achieve under favorable real-world conditions. With EVs, I often see the opposite. The conservative Inmetro figure gets repeated as the defining range of the vehicle, while owner consumption and independent road results receive much less attention. A much better way to discuss EV range is to show the homologation numbers and then show actual energy consumption. If an EV does 12, 15, 18 or 22 kWh/100 km, anyone can understand what a 40, 60 or 90 kWh battery means under different conditions. That's much more informative than saying “this is a 300 km car” because one homologation system printed 300 km on the label. And all of this comes back to the original Detroit question. Brazil is becoming a useful real-world laboratory because Chinese manufacturers are no longer simply shipping Chinese-built cars here. They are buying former Western factories, hiring Brazilian workers and progressively localizing production. At the same time, established American, European and Japanese manufacturers are increasingly using Chinese partners, platforms, batteries, engineering or complete vehicles. Europe is moving in a similar direction as Chinese manufacturers localize more production there. That gives us an opportunity to separate two things that are constantly mixed together in this discussion. If Chinese manufacturers lose most of their price advantage when they manufacture in Brazil, Europe or eventually the US with local workers, then Chinese wages, subsidies and domestic production conditions were clearly doing much of the work. But if a substantial advantage survives localization, then wages cannot be the entire explanation. Battery costs, vertical integration, EV-specific platforms, supplier organization, procurement, manufacturing scale, automation, development cycles and margins all have to enter the discussion. That's why I would actually find an American-built Chinese EV much more interesting than another imported Chinese EV. Require American production. American wages. American safety and environmental standards. Apply the same rules to everyone. Then compare the products. If an American-built BYD ends up costing roughly the same as an equivalent American-built GM or Ford, we learn something important about where the original Chinese cost advantage came from. But if it can still compete aggressively on price, equipment and efficiency while paying American production costs, then tariffs didn't answer the underlying competitiveness question. They only delayed the experiment.

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If BYD comes in, it will really erode GM and Ford. Ford already is struggling pretty badly. GM is just treading water. Any deal to bring Chinese cars into the US would need to require they are built/assembled in the US. Otherwise they'll absolutely destroy the competition. It's extremely dangerous to basically let China do all of the world's manufacturing

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One thing I think this thread is showing is that the question is becoming bigger than simply "Chinese cars are cheap because Chinese workers are cheap." Wages and subsidies matter. But Chinese manufacturers are increasingly moving production outside China, which gives us a chance to test that explanation in the real world. Brazil is a particularly interesting example. For decades, the market was dominated by established American, European, Japanese and Korean manufacturers with local factories, suppliers, dealerships and huge brand recognition. Chevrolet was enormously strong, and the Onix spent years as the country's best-selling car. Now the structure is changing. BYD took over Ford's former industrial complex in Camaçari and is progressively localizing production. GWM took over Mercedes-Benz's former factory in Iracemápolis. Renault and Geely are expanding their industrial partnership and investing together in Brazil. And it gets stranger than simply "Chinese companies versus legacy automakers." GM itself is assembling Chinese-developed Chevrolet EVs in Brazil. The Spark EUV and Captiva EV are being assembled in Ceará using products originating from GM's Chinese ecosystem with SAIC and Wuling. Toyota has a 50/50 EV R&D joint venture with BYD. Nissan has a long industrial relationship with Dongfeng in China. Renault is partnering with Geely. So the borders between "Chinese" and "traditional" manufacturers are becoming increasingly blurry. Europe may become an even better test. Chinese manufacturers are actively looking for existing European factories rather than simply exporting everything from China. BYD says that, longer term, it expects to need three vehicle assembly plants and a battery plant in Europe. That is why I don't think the wage argument settles this. If BYD builds cars with Brazilian or European workers and most of its price advantage disappears, then labor costs, subsidies and producing in China were obviously doing a huge amount of the work. But if a substantial advantage remains, we have to ask what else explains it: battery costs, vertical integration, platform design, automation, supplier organization, scale, development cycles, margins, or some combination of them. And this is where I come back to Detroit. The US doesn't have to allow unlimited Chinese imports to test this. Require local production. Require American wages. Require US safety and environmental standards. Apply trade safeguards. Then let the products compete. Protection can give an industry time to adjust. But the important question is what Detroit does with that time. Because Chinese manufacturers aren't standing still outside the US. They're localizing production, buying or reusing factories, forming partnerships with established manufacturers and becoming part of the same global supply chains that legacy automakers use. Brazil is already experiencing that transition. Europe increasingly is too. Renault and Geely, for example, just announced another €319 million investment in their Brazilian partnership. If an American-built Chinese EV eventually costs roughly the same as an American-built competitor, we'll have learned something important about the original Chinese cost advantage. But if it can still compete aggressively on price and equipment while paying American production costs, then keeping the imported version out didn't solve Detroit's underlying competitiveness problem. It just postponed the test.

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I actually agree with this sentiment, Detroit got it's start by essentially seizing their supply lines and doing a top down supply chain take over. Everything Ford had was integrated into their main business. It's only until recently that they started out sourcing everything and then everything start getting more expensive. Look at BYD, it's own software engineers, it's own battery manufacturers, it's own mining and fabrication areas, heck they even have freighter ships for their export vehicles. America really isn't doing their car companies any favors by stopping more innovative foreign car exports from coming in, but at the same time American car companies REFUSE to innovate and the same can be said for lots of American companies. Ahem Boeing. I don't think anyone can come close to manufacturing EV's and Batteries when it comes to China. Also there definitely is an EV bubble in China as well.

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I think several comments here are mixing two separate questions. Yes, China has lower manufacturing wages, industrial subsidies matter, and the US has legitimate reasons to care about trade rules. I'm not arguing that Chinese manufacturers should simply get unrestricted access to the American market. What I'm questioning is the idea that cheap labor alone explains why Chinese cars are cheaper, and that keeping them out therefore solves Detroit's competitiveness problem. Brazil is becoming a useful real-world test. GM, Volkswagen, Fiat and Toyota have been manufacturing here for decades. They already have factories, established suppliers, huge dealer networks, brand recognition and enormous scale. Chinese manufacturers entered with almost none of those advantages. Their cars initially had to be shipped across the ocean, pay import duties and Brazilian taxes, establish distribution and dealerships from scratch, and compete against locally produced ICE cars. Yet they were still able to price BEVs and PHEVs directly against conventional ICE vehicles. And now Chinese manufacturers are increasingly localizing production in Brazil. That makes the labor argument even more interesting, because progressively more of the production cost is Brazilian rather than Chinese. So where does the remaining price competitiveness come from? That's the part I think deserves more attention: vertical integration, battery costs, dedicated EV platforms, fewer components, supplier structure, manufacturing efficiency, scale, software/electronics integration and possibly lower margins while entering a new market. It doesn't mean subsidies and Chinese labor costs are irrelevant. It means they probably aren't the entire explanation. There's also an interesting counterargument several people here have raised: protecting Detroit's highly profitable US market could give GM and Ford the cash and time they need to become more competitive elsewhere. That could work. But then the important question is what they do with that protection. GM can make excellent money selling large pickups and SUVs in the US while simultaneously competing with BYD, GWM and Geely in places like Brazil. If those American profits finance better platforms, lower production costs and more competitive electrified cars globally, then the protected home market is buying useful time. If instead protection allows Detroit to remain increasingly dependent on high-margin trucks and SUVs while competitors gain scale and manufacturing experience in the rest of the world, then protection may simply be hiding the competitiveness problem. That's why I'd actually like to see Chinese manufacturers subjected to the hardest possible version of this test in the US. Don't give them unrestricted imports. Require local production. Require American wages, American safety standards and American regulations. Then let an American-built BYD compete against an American-built GM or Ford. If the price advantage largely disappears, then labor, subsidies and imports really were doing much of the work. But if a locally produced Chinese EV can still compete on price with a locally produced American ICE vehicle or EV, then Detroit has a manufacturing-cost problem that tariffs alone aren't going to solve.

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That's actually the strongest counterargument to what I'm suggesting, and I think it's possible. A protected and highly profitable US market could give GM the cash flow to compete much more aggressively elsewhere. GM could make money on trucks and SUVs at home while being forced to cut costs and develop cheaper electrified products in markets like Brazil. My question is what happens if those two sides of GM start diverging too much. If the protected US profits are being used to make GM more efficient globally, then protection may genuinely be buying useful time. But if GM becomes increasingly dependent on high-margin trucks and SUVs in the US while its smaller and more affordable products struggle against Chinese competitors internationally, then the protected market may be masking the problem rather than fixing it. Brazil is why I'm interested in this distinction. GM can't avoid BYD, GWM and Geely here. Chevrolet has to compete for the same private customers, and that is already forcing a different product and pricing environment. So I agree that protection doesn't automatically make GM less competitive. The question is whether Detroit is using the protected revenue stream to become capable of competing without protection later. If it is, that's a successful industrial strategy. If it isn't, then the US market becomes a very profitable shelter while the competitive problem keeps growing outside it.

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I mean they fell behind when the network of suppliers in the upper Midwest/great lakes stopped being the past's equivalent of the pearl river delta's supply chain cluster. China is so ahead in terms of the local manufacturers, and the amount BYD can squeeze them. Their business practices make the worst of Walmart's supplier relationships seem kind and gentle by comparison. Basically it's an un level field but the benefit of dramatically cheaper transport and exciting EVs undercutting the price of the leaf... It's a pretty big upside.

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