A group representing nearly all major automakers on Monday, Nov. 2 urged U.S. lawmakers to pass a permanent ban on Chinese vehicles when they return next week for a quick session after the midterm congressional elections.
In September, the Senate sponsors of the bipartisan effort to ban Chinese vehicles agreed to delay an effort to fast-track the bill until November despite overwhelming support.
Some congressional aides and auto lobbyists think if Democrats win control of Congress there may not be enough time to approve the Chinese vehicle ban before this session ends in December.
The domestic automakers have become hopelessly addicted to American oligopoly profit margins, and have entirely forgotten how to compete for business and win on merit.
If they went back and read one of those old boring economics textbooks, they would learn that you can successfully operate on a reasonable margin and lock in repeat business by establishing a good reputation and overall being desirable.
Competing nations subsidizing their industry is what tools like trade restrictions and tariffs are for, of course, but they are tools meant to level the playing field, not to pick winners and losers. Banning the sale of products like the Toyota Hilux and the whole BYD product line is simply naked cowardice manifested through regulatory capture.
There are only three remaining domestic manufacturers (Ford, GM, Tesla) and they only make up a minority of sales in the US. It really puzzles me why so many people think the US automotive market is entirely made up of American companies when it so obviously isn’t. No other automaker in the world is able to build and sell vehicles as cheap as these Chinese brands are doing and that’s because the Chinese government is paying the difference. That isn’t a sustainable model long term. These prices can’t last forever. Some people think we should do what China is doing with subsidies, but do you think sending even more of our tax dollars to Elon Musk, Mary Barra, or Jim Farley is the answer? That’s what that solution looks like.
As far as margins go, you can Google this information. GM’s net profit margin for 2025 was 1%, Ford’s was -4%, and Teslas was 4%. What room do they have here? If they drop them even further, where do they get the money to further develop EVs?
I do agree that an outright ban is too far, but I do support heavy tariffs at the least as anything less is just sacrificing some of the few remaining manufacturing jobs left in this country and shipping them overseas all for an extremely temporary benefit.
I think that this inability to compete stems from a cultural aversion to reinvestment among those in the business world.
If these cars are making them those tiny or even negative margins at these prices that look like mortgages, they would benefit from evaluating themselves from top to bottom:
I believe that companies that grow to the size and influence that these have, they uniformly develop pathological behaviors and methods centered around maximizing value extraction from the business entity and dictating terms to the market they “serve”. Soul-searching questions like those above, and really any sentiment toward genuine investment and betterment at all become foreign, radical, and distasteful to them and their supporters. They then shuffle along for potentially decades after they have essentially died, persisting on critical mass alone until the market is finally disrupted enough where that alone can’t save them. BYD may be heavily subsidized, but they’re also comparatively new and young, able to innovate and respond to market demands, fundamental practices their older monopolistic competitors have long ago lost interest in doing.
Those are all fine questionsn but until you actually have the answer to them, who are you or anyone else to pass judgement or make proclamations about them?
They’re not able to innovate and respond quickly because they’re new. They’re able to do this because they have a blank check to do so with plenty of local ‘competitors’ in the same situation; the whole 10,000 apes sitting at typewriters scenario. We can see the same thing here in the US with venture capitalists funding all sorts of startups and look where that has gotten us. Tesla is also new and young but we haven’t seen any innovations from them in about a decade now, just to demonstrate my point.
What new innovations are you referring to specifically by the way? AFAIK the appeal of Chinese EVs is that they’re selling for 1/4 the price of any other nation’s EVs. This wasn’t accomplished through innovation. It was accomplished through deep pockets. I don’t know of any feature present in Chinese EVs that someone else hasn’t already figured out.