China’s BYD is set to take Tesla’s crown as the world’s No. 1 producer of battery electric vehicles

[iguanaman]

Thank you for backing me up!

We can agree that Tesla has been increasing its sales, while other domestic manufacturers are rolling back ev production.

As a result, Biden removed tax credits for domestic evs in upper price ranges - which affect Tesla, as the largest manufacturer and the only domestic manufacturer of evs who is increasing production, and not other manufacturers who literally just stopped making evs.

And Biden didn't slap any tariffs on Chinese evs... weird how China is taking over a market that Biden didn't support and isn't fighting China on...

Ok, it's not weird, is it? Not after seeing how Biden increased US oil production, and supported global oil production... it's almost like he wanted to harm domestic ev producers and encourage ICE producers...

Sigh ...Buyers of $100,000 EV's do not need tax incentives. They are meant to help the rest of us afford a EV and for car makers to get EV prices down. The U.S needed to increase oil production to compensate for the sanctions on Russian oil due to their invasion of Ukraine. Without it the world would be suffering from inflated energy prices that would hurt our economy and the worlds. Biden also quadrupled the tariffs on China made EV's to 100%. China is not taking over the market for EV's here either.

The big headline from President Biden’s new tariffs on Chinese goods announced Tuesday was the massive hit to electric vehicles made in China.
New duties on EVs from companies like BYD (BYDDY), Geely (GELYF), and NIO (NIO) are set to quadruple in 2024, to 100% from 25% of the cost of the vehicle.

https://finance.yahoo.com/news/why-...e-impact-on-the-us-auto-market-140135630.html

 

[Surrealistik]

Chinese companies spend 43 billion a year on licensing ip from outside companies

Sure; that does not somehow obviate the fact that China is also by far a world leader in IP theft and piracy hence my initial confusion.

The FBI estimate of 500 billion lost in IP is ridiculous. Just think of the quantity of products that would represent.

This involves the estimated proceeds of piracy and knockoff/unlicensed goods (and goods manufactured with stolen IP), loss of revenue from use of pirated goods (e.g. software), as well as the economic value of stolen IP itself. It's notable that even the lower end of the FBI's estimate range is rather damning and dwarfs the total IP licensing spend by China.

 

[Lord Tammerlain]

Sure; that does not somehow obviate the fact that China is also by far a world leader in IP theft and piracy hence my initial confusion.

This involves the estimated proceeds of piracy and knockoff/unlicensed goods (and goods manufactured with stolen IP), loss of revenue from use of pirated goods (e.g. software), as well as the economic value of stolen IP itself. It's notable that even the lower end of the FBI's estimate range is rather damning and dwarfs the total IP licensing spend by China.

Again that value by the FBI is ridiculous.

Robots and robotics design are rather old, developing new ones is not rocket science especially considering that China buys a huge amount overseas.

Building cars is not rocket science, the way GM build a car is not drastically different than how Ford does. That GM builds a car in the same way as Ford is not IP theft.

The most common copied items are the cheap easy to manufacture items that really can't be patented in the first place, perhaps trademarked but not patented. Items like a selfystick that is going to be copied by a dozen factories in a few days if popular. If the items are actually ip stolen, they would not be sold out of China or countries like Africa in any real volume.

Now regarding that, China was if I recall correctly the largest market for luxury goods up until the last couple of years. If counterfeit goods was really impacting Chanel that would not be the case



As for counterfeit goods, there is no way that value comes anywhere close to 500 billion a year in actual goods sold or potential revenue lost. No one buys a fake Hermes Bag that is would have bought a real one

 

[Surrealistik]

Again that value by the FBI is ridiculous.

Robots and robotics design are rather old, developing new ones is not rocket science especially considering that China buys a huge amount overseas.

Building cars is not rocket science, the way GM build a car is not drastically different than how Ford does. That GM builds a car in the same way as Ford is not IP theft.

The most common copied items are the cheap easy to manufacture items that really can't be patented in the first place, perhaps trademarked but not patented. Items like a selfystick that is going to be copied by a dozen factories in a few days if popular. If the items are actually ip stolen, they would not be sold out of China or countries like Africa in any real volume.

Now regarding that, China was if I recall correctly the largest market for luxury goods up until the last couple of years. If counterfeit goods was really impacting Chanel that would not be the case

As for counterfeit goods, there is no way that value comes anywhere close to 500 billion a year in actual goods sold or potential revenue lost. No one buys a fake Hermes Bag that is would have bought a real one

The FBI estimate (also in line with the OECD and Congressional estimates) is holistic of the value of all piracy, counterfeit and unlicensed goods and services, and stolen IP and the resulting recovery costs, loss of revenues and sales, not any single one of these categories; taken together, I find the lower end of its estimate, which is roughly 200 billion, very credible.

As an aside, not that it's particularly relevant, but the largest market for luxury goods was and presently remains the US (which has plenty of consumers of knockoff merch no less). I don't see how the size of China's luxury market is meaningful as a disproving factoid about the extent of counterfeit revenues given that it has no direct bearing on the market size for counterfeits, and that the market for Chinese counterfeits is international in nature (yes, there is a risk of seizure when selling internationally; it is a risk counterfeiters take and for them, simply a cost of doing business: https://daxueconsulting.com/counterfeit-products-in-china/ ).

What especial insight do you have to conclude that even that number must be bogus other than a gut assertion about the supposed ease of producing and developing specific bits of IP?

 

[phoenix2020]

First of all, 'high quality' is a curious descriptor of BYD products; I certainly wouldn't call their products outright garbage (at least not what is deemed fit for export), but 'high quality' is certainly a bridge too far:

https://insideevs.com/news/712148/byd-quality-problems-hit-international-markets/

https://www.wsj.com/business/autos/having-overtaken-tesla-byd-is-running-into-problems-overseas-7d883f02

Second, it's no mystery how BYD rapidly became the top EV manufacturer: overwhelmingly it is attributable to a combination of technology coerced from Western 'partners' such as Tesla as the cost of doing business in China and gaining access to its markets, stolen IP (to the tune of ~$225-600 billion worth annually per the FBI), lower cost of manufacture between lower salaries, inferior working conditions and comparatively lax regulation (either in terms of enforcement, legislation or both), and of course, the special sauce of hundreds of billions worth of past and ongoing PRC subsidies and industrial policy (yes, many Western manufacturers also benefit from some manner of subsidy; however total Chinese subsidies that we know of have been substantially more generous: https://www.carbonbrief.org/qa-the-global-trade-war-over-chinas-booming-ev-industry/ || https://www.cnbc.com/2024/06/21/chi...uild-its-electric-car-industry-csis-says.html ). The latter is the single most prominent reason that BYD is rightly facing heavy tariffs across the world, including in the US, and why the EU is presently investigating Chinese EV manufacturers for uncompetitive practices on the basis of government subsidy.

I have spent many weeks at BYD facilities and know many of their top leadership. The above is largely BS.

BYD is a somewhat unique company. Like Tesla at its start, BYD is fundamentally a battery company—and a damn innovative one. They build vehicles but their core is battery and most of their leadership are battery guys. They’re also somewhat unique in the sense that their affiliation with the PRC is quite hands-off versus all other Chinese manufacturers. This is what has led to their standout growth and ability to move beyond China’s market. Some of their vehicles are crap, others are quite impressive, and there is no doubt they move faster than most other global automakers.

I would describe their engineering culture as not dissimilar from say SpaceX.

 

[phoenix2020]

BYD doesn't seem to have a good safety reputation.
I know Teslas were cursed by fires but they seem to have figured out how to make their cars a little safer in the last few years.
There is no way to prevent a car from catching on fire in an accident but the issue seems to be EV's that spontaneously burst into flames while charging, or JUST SITTING.

Other US makers have had spotty records on that but they also appear to be working it out.
BYD doesn't seem to care that much yet.

Their crash engineering capability is nowhere near say a VW. however their battery and electric powertrain hardware is the equal of anybody else out there.

 

[phoenix2020]

Again that value by the FBI is ridiculous.

Robots and robotics design are rather old, developing new ones is not rocket science especially considering that China buys a huge amount overseas.

Building cars is not rocket science, the way GM build a car is not drastically different than how Ford does. That GM builds a car in the same way as Ford is not IP theft.

The most common copied items are the cheap easy to manufacture items that really can't be patented in the first place, perhaps trademarked but not patented. Items like a selfystick that is going to be copied by a dozen factories in a few days if popular. If the items are actually ip stolen, they would not be sold out of China or countries like Africa in any real volume.

Now regarding that, China was if I recall correctly the largest market for luxury goods up until the last couple of years. If counterfeit goods was really impacting Chanel that would not be the case



As for counterfeit goods, there is no way that value comes anywhere close to 500 billion a year in actual goods sold or potential revenue lost. No one buys a fake Hermes Bag that is would have bought a real one

In 2024, China no longer needs to copy IP, they are world class in multiple domains. That of course doesn’t excuse what happened in the decades prior.

 

[Surrealistik]

I have spent many weeks at BYD facilities and know many of their top leadership. The above is largely BS.

BYD is a somewhat unique company. Like Tesla at its start, BYD is fundamentally a battery company—and a damn innovative one. They build vehicles but their core is battery and most of their leadership are battery guys. They’re also somewhat unique in the sense that their affiliation with the PRC is quite hands-off versus all other Chinese manufacturers. This is what has led to their standout growth and ability to move beyond China’s market. Some of their vehicles are crap, others are quite impressive, and there is no doubt they move faster than most other global automakers.

I would describe their engineering culture as not dissimilar from say SpaceX.

To be clear, I never said that BYD was crap. My argument is that one cannot reasonably claim their build quality to be uniformly high which is accurate as you've essentially admitted.

As to generous CCP industrial policy/massive state subsidies, that is very real, indisputable and primarily explanatory of the rapid rise of EV manufacturing in China.

 

[Surrealistik]

In 2024, China no longer needs to copy IP, they are world class in multiple domains. That of course doesn’t excuse what happened in the decades prior.

They still do it at an industrial scale though, even if they have the capability at this point to innovate without resorting to dirty pool.

 

[Lord Tammerlain]

To be clear, I never said that BYD was crap. My argument is that one cannot reasonably claim their build quality to be uniformly high.

As to generous CCP industrial policy/massive state subsidies, that is very real and primarily explanatory of the rapid rise of EV manufacturing in China.

China pushed EV manufacturing for two main reasons, air quality and to be a leader in a market segment.

In the late 2000s and early 2010s air quality was horrible in many Chinese cities. The worst in the world. So it decided to clean the air, EV were part of it, making it so EVs were easier to register and provide subsidies much like the Canadian government is planning to give to Ford, VW among others.

The other parts were renewable and nuclear energy. It is also now a world leader in wind and solar technology.

Air quality in Chinese cities have dramatically improved. For 2023 it has I believe only two in the worst 50 cities worldwide.

 

[Surrealistik]

China pushed EV manufacturing for two main reasons, air quality and to be a leader in a market segment.

In the late 2000s and early 2010s air quality was horrible in many Chinese cities. The worst in the world. So it decided to clean the air, EV were part of it, making it so EVs were easier to register and provide subsidies much like the Canadian government is planning to give to Ford, VW among others.

The other parts were renewable and nuclear energy. It is also now a world leader in wind and solar technology.

Air quality in Chinese cities have dramatically improved. For 2023 it has I believe only two in the worst 50 cities worldwide.

I would add a third primary motive common to many of the CCP's hundred billion+ ventures: to stimulate the economy and sustain growth through state investment.

Of primary concern though, is its aggressive subsidy, export tactics, and equally aggressive pushback to any mitigation of those tactics concerning EVs. I would have to imagine that an concerted attempt to corner or at least domineer the EV market through extensive state intervention (much like with Huawei) ranks very prominently if not most prominently among the motives of the CCP's sponsorship of the EV industry.

Moreover, it's frankly hard to buy that lowering emissions is anywhere close to the main priority of such policy given that automobiles account for a relatively little proportion of emissions in the country; whereas it's about 30% of total emissions in the US, they amount to roughly half that in China; if the CCP was primarily looking to curb emissions and improve air quality, it would have been far better served investing the subsidies purposed for EVs into reduction of industrial and power generation emissions. At best reduced emissions from the proliferation of EVs is a pleasant side effect.

 

[Checkerboard Strangler]

Their crash engineering capability is nowhere near say a VW. however their battery and electric powertrain hardware is the equal of anybody else out there.

According to current owners it's more like the level of a 2000 Kia Sportage.

 

[Lord Tammerlain]

I would add a third primary motive common to many of the CCP's hundred billion+ ventures: to stimulate the economy and sustain growth through state investment.

Of primary concern though, is its aggressive subsidy, export tactics, and equally aggressive pushback to any mitigation of those tactics concerning EVs. I would have to imagine that an concerted attempt to corner or at least domineer the EV market through extensive state intervention (much like with Huawei) ranks very prominently if not most prominently among the motives of the CCP's sponsorship of the EV industry.

Moreover, it's frankly hard to buy that lowering emissions is anywhere close to the main priority of such policy given that automobiles account for a relatively little proportion of emissions in the country; whereas it's about 30% of total emissions in the US, they amount to roughly half that in China; if the CCP was primarily looking to curb emissions and improve air quality, it would have been far better served investing the subsidies purposed for EVs into reduction of industrial and power generation emissions. At best reduced emissions from the proliferation of EVs is a pleasant side effect.

Solar, wind, nuclear and hydro have all increased dramatically in the years as well.

Particulate matter was very high in part to use of coal thermal plants for heating, which have been replaced, older coal plants have also been shut down and replaced with more modern ones with particulate removal technology

 

[Surrealistik]

Solar, wind, nuclear and hydro have all increased dramatically in the years as well.

Particulate matter was very high in part to use of coal thermal plants for heating, which have been replaced, older coal plants have also been shut down and replaced with more modern ones with particulate removal technology

The new coal plants are still highly polluting.

Again, they could have put those hundreds of billions towards improving emissions created by their energy and industry and seen substantial emission reductions rather than maybe a 30% reduction at best of ~15% of their total emissions, capping at ~4.5% total emission reduction assuming every last Chinese vehicle was replaced with an EV which is unlikely at best; more realistically you're going to see at most 50% EV adoption in any reasonable time frame for roughly 2-3% reduction of total emissions.

 

[Lord Tammerlain]

The new coal plants are still highly polluting.

Again, they could have put those hundreds of billions towards improving emissions created by their energy and industry and seen substantial emission reductions rather than maybe a 30% reduction at best of ~15% of their total emissions, capping at ~4.5% total emission reduction assuming every last Chinese vehicle was replaced with an EV which is unlikely at best; more realistically you're going to see at most 50% EV adoption in any reasonable time frame for roughly 2-3% reduction of total emissions.

Last month EV sales in China were over 50% of total, it will take time of course to replace the fleet of ice vehicles.


As for the energy and industrial plants, work has been done to improve the emissions. But as the economy has grown, total emissions goes up.

But the steps China is taking is impressive. It has more than 4 times the installed solar generation than the US. It has double the installed wind power generation than the US. It has 5 times the installed hydropower generation than the US

Of " green" power, the US leads only in nuclear power generation at not quite double that of China. Which gap China will close soon as it is building 24 nuclear power plants ( currently has 27 i believe)

 

[Surrealistik]

Last month EV sales in China were over 50% of total, it will take time of course to replace the fleet of ice vehicles.


As for the energy and industrial plants, work has been done to improve the emissions. But as the economy has grown, total emissions goes up.

But the steps China is taking is impressive. It has more than 4 times the installed solar generation than the US. It has double the installed wind power generation than the US. It has 5 times the installed hydropower generation than the US

Of " green" power, the US leads only in nuclear power generation at not quite double that of China. Which gap China will close soon as it is building 24 nuclear power plants ( currently has 27 i believe)

Even granting all of this, the fact remains, and the point I'm making, is that if China's priority with this effective spend of hundreds of billions was primarily to curb emissions, not to attempt to say, aggressively corner a market, it would have been far better served by putting that money/those credits towards continuing to expedite pollution reduction in the sectors overwhelmingly responsible for its emissions, rather than hoping for at best low single digit total reductions after an uncertain and long time frame.

 

[SayMyName]

Even granting all of this, the fact remains, and the point I'm making, is that if China's priority with this effective spend of hundreds of billions was primarily to curb emissions, not to attempt to say, aggressively corner a market, it would have been far better served by putting that money/those credits towards continuing to expedite pollution reduction in the sectors overwhelmingly responsible for its emissions, rather than hoping for at best low single digit total reductions after an uncertain and long time frame.

I see what you are saying.

I would proffer that they are succeeding at doing both. They have taken the helm of producing products which the West once championed to combat climate change. At the same time they have drastically reduced the amount of pollution that only a few years ago scarred the sky of the entire nation. Currently, it is this nation which has more solar and wind power generation than any other. Whatever their motivations and reasoning, they have concluded both can be done together.

I include some photos taken recently while traveling by high speed train south of Shanghai, between the cities of Hangzhou, Ningbo and Taizhou. These photos are telling. This is an area of manufacturing. Automobile manufacturers such as Geely, Volvo and many others have several plants here. If you buy medicine, good chance it is produce nearby. Shoes? 50 percent of the shoes in the world are from here, as well as eye wear. Compressors for air conditioning and refrigeration...60 percent of the global market.

When I first came here a decade ago, none of the features or objects in the distance could be discerned, so dark and grey was the sky at midday. I never thought this land as beautiful. Instead, I fought against sullenness on a daily basis as if in a horror film. I had a job to do. Walking for any length of time outside was akin to smoking a pack of cigarettes. Now, it has changed. Blue sky with white clouds are the norm. Traveling frequently to all parts of this country on a regular basis for business, I can attest it is very much the same, with the exception of Beijing and Xian. Not sure yet why they can not get their act together.

Anyway, good points all, truly. Thanks for contributing. A lot of food for thought. This goes out to all of you.

 

[Lord Tammerlain]

I see what you are saying.

I would proffer that they are succeeding at doing both. They have taken the helm of producing products which the West once championed to combat climate change. At the same time they have drastically reduced the amount of pollution that only a few years ago scarred the sky of the entire nation. Currently, it is this nation which has more solar and wind power generation than any other. Whatever their motivations and reasoning, they have concluded both can be done together.

I include some photos taken recently while traveling by high speed train south of Shanghai, between the cities of Hangzhou, Ningbo and Taizhou. These photos are telling. This is an area of manufacturing. Automobile manufacturers such as Geely, Volvo and many others have several plants here. If you buy medicine, good chance it is produce nearby. Shoes? 50 percent of the shoes in the world are from here, as well as eye wear. Compressors for air conditioning and refrigeration...60 percent of the global market.

When I first came here a decade ago, none of the features or objects in the distance could be discerned, so dark and grey was the sky at midday. I never thought this land as beautiful. Instead, I fought against sullenness on a daily basis as if in a horror film. I had a job to do. Walking for any length of time outside was akin to smoking a pack of cigarettes. Now, it has changed. Blue sky with white clouds are the norm. Traveling frequently to all parts of this country on a regular basis for business, I can attest it is very much the same, with the exception of Beijing and Xian. Not sure yet why they can not get their act together.

Anyway, good points all, truly. Thanks for contributing. A lot of food for thought. This goes out to all of you.
View attachment 67532477
View attachment 67532478
View attachment 67532480

Dramatic changes in 10 years.

 

[Surrealistik]

I see what you are saying.

I would proffer that they are succeeding at doing both. They have taken the helm of producing products which the West once championed to combat climate change. At the same time they have drastically reduced the amount of pollution that only a few years ago scarred the sky of the entire nation. Currently, it is this nation which has more solar and wind power generation than any other. Whatever their motivations and reasoning, they have concluded both can be done together.

I include some photos taken recently while traveling by high speed train south of Shanghai, between the cities of Hangzhou, Ningbo and Taizhou. These photos are telling. This is an area of manufacturing. Automobile manufacturers such as Geely, Volvo and many others have several plants here. If you buy medicine, good chance it is produce nearby. Shoes? 50 percent of the shoes in the world are from here, as well as eye wear. Compressors for air conditioning and refrigeration...60 percent of the global market.

When I first came here a decade ago, none of the features or objects in the distance could be discerned, so dark and grey was the sky at midday. I never thought this land as beautiful. Instead, I fought against sullenness on a daily basis as if in a horror film. I had a job to do. Walking for any length of time outside was akin to smoking a pack of cigarettes. Now, it has changed. Blue sky with white clouds are the norm. Traveling frequently to all parts of this country on a regular basis for business, I can attest it is very much the same, with the exception of Beijing and Xian. Not sure yet why they can not get their act together.

Anyway, good points all, truly. Thanks for contributing. A lot of food for thought. This goes out to all of you.

Indeed, China has made substantial progress on pollution by focusing on the main culprits of emissions, which underscores exactly the point I am making: that a return on investment, in terms of emission reduction, is and will be far greater outside of EV production, and thus emission/pollution reduction cannot reasonably be considered the primary objective of mass EV subsidy.

It is clear that the CCP's objective, by their spend, what that spend achieves, and their aggressive export policy, is to corner the EV market with the classic, tried and true tactic of subsidy enabled price dumping vis a vis Western competition which we have seen in other industries like telecommunications; again, not especially hard to do if you are willing to throw hundreds of billion dollars at that objective and play dirty pool on trade while your competition is not (until of course they inevitably leverage justified tariffs to offset such tactics as per the States and increasingly the EU).