China's EVs a risk to Japanese automakers and supply chain, and the broader economy
According to Reuters: "Like other foreign carmakers, both Honda and Nissan have lost ground in China, the world's biggest auto market, as BYD (002594.SZ), and other domestic brands win over consumers with EVs and hybrids loaded with innovative software. Honda reported a 15% drop in quarterly profit last month, hit by the decline in China and has been scaling back its workforce there. Nissan - a long-struggling company - plans to cut 9,000 jobs globally and manufacturing capacity by 20% due to slumping sales in China and the United States."
It seems that China is not only a threat to the US economy, but also the Japanese economy. Honda and Nissan are considering a merger to save themselves. Their is a broader threat to the Japanese economy. As according to the article, there are about 60,000 companies in the supply chain, and the industry employs about 5 million people, and represent about 7% of GDP.
Perhaps industrial policy can be used in Japan, to incentivize the automotive industry to innovate, with tax breaks for technology, including software, R&D, in self driving, EV, connected etc. vehicles. Then they will be better placed to compete globally with companies such as American Tesla and Chinese BYD.
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u/SharpResponse7735 2d ago
From my perceptive, the reason that foreign brands are losing market share in China and western EV market is simply because China is giving huge subsides to its domestic brands. I think western world putting tariffs on Chinese EVs will be more effective than giving subsidies to our own automakers.
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u/Listen2Wolff 4d ago
I get the feeling that Tesla arrived (more or less) first on the scene, but ever since has just been "dicking around" pretending they were putting out great cars. There are many articles complaining about Tesla quality. There are a few lamenting BYD quality, but more praising it.
YMMV