Elon Musk, CEO of Tesla, has warned that Chinese automakers might overwhelm their international rivals if there are no tariffs or trade barriers to hinder them. Musk highlighted the competitive nature of Chinese automakers and suggested their success could be significant if not restrained by trade barriers.
Musk shared his belief that Tesla is nearing the "natural limit of cost reduction" for its current products. The company reduced prices for its electric vehicle (EV) models last year in a bid to improve affordability for customers who struggle with high loan costs. However, this move adversely affected the company's profit margins, and it has led to concerns among investors.
On the other hand, another Chinese electric car firm, BYD, has taken over Tesla's position as the top-selling EV company in the last quarter. In light of Musk's remarks, Chinese foreign ministry insisted on the importance of keeping a 'fair, just, and open' business atmosphere.
In contrast, the European Commission is considering imposing higher tariffs on Chinese electric vehicle imports to safeguard EU manufacturers. They have broadened their sales to various markets including Europe, the Middle East, and Southeast Asia. It has been reported that China is striving to ascend to the top position in the global electric vehicle market and aims for its two largest EV manufacturers to achieve 10% of their total sales overseas by 2025.
