Thank the Lord in heaven! I’d buy a BYD right now if I could.
Let’s take stock for a moment. A freaking Toyota Corolla is pushing $30,000. A Corolla.
A regular F-150 is $60,000+. The average new car sells for around $40,000, and the average monthly payment is close to $1,000.
And guess what? They’re not selling. They’re just too expensive. A Ford Raptor is over $100,000. Over $100,000. Dealerships are flooded with them, and they still aren’t making meaningful deals.
From a purely economic perspective, we need competition from China to force this market back toward affordable vehicles, because there are no genuinely cheap, affordable new cars in this country anymore.
On one hand, there’s a minimum price at which a product can be sold while still generating enough profit for a company to remain viable, pay its employees, and continue operating.
On the other hand, there’s the American business practice of maximizing every possible fraction of a cent in pursuit of higher quarterly profits. As we all know from game theory, pure min-maxing doesn’t always produce the best long-term outcome. There has to be a balance. Nevertheless, many American companies are driven primarily by maximizing shareholder returns. In doing so, they can end up shooting themselves in the foot, making decisions that inflate short-term financial results while ultimately reducing their long-term profitability.
China, by contrast, has a quasi-socialist market economy under a single-party government. It has invested heavily in developing strategic industries, including electric vehicles. The government sets national priorities and can exert enormous influence over companies. If corporate leadership fails to meet those objectives, it can be replaced far more easily than in Western economies.
In the United States, corporations instead spend enormous sums lobbying politicians to pass laws favorable to their interests. But, as discussed above, relentlessly optimizing for short-term gains doesn’t always produce the best long-term results.
That’s one reason Chinese cars are so inexpensive. Or rather, they’re arguably priced closer to what cars should cost. The real question may be why cars in the United States have become so expensive. Automakers cite rising costs, regulations, technology, and financing practices, but prices seem to ratchet upward far more readily than they ever come back down.
Many reasons but two big ones are that they don’t pay employees like North America does, and I’m fully convinced they’re pulling the EEE technique to dominate the NA market once they’re in.
Because they have invested heavily into automation. A couple years ago the ford ceo went over there and came back terrified. He didn’t think it here was any way that american companies had a chance of competing.
Thank the Lord in heaven! I’d buy a BYD right now if I could.
Let’s take stock for a moment. A freaking Toyota Corolla is pushing $30,000. A Corolla.
A regular F-150 is $60,000+. The average new car sells for around $40,000, and the average monthly payment is close to $1,000.
And guess what? They’re not selling. They’re just too expensive. A Ford Raptor is over $100,000. Over $100,000. Dealerships are flooded with them, and they still aren’t making meaningful deals.
From a purely economic perspective, we need competition from China to force this market back toward affordable vehicles, because there are no genuinely cheap, affordable new cars in this country anymore.
Why are Chinese cars so inexpensive?
Heavy jnvestment in battery industry and government steered subsidies into renewables vs endless money to bomb brown people.
That’s a very difficult question to answer.
On one hand, there’s a minimum price at which a product can be sold while still generating enough profit for a company to remain viable, pay its employees, and continue operating.
On the other hand, there’s the American business practice of maximizing every possible fraction of a cent in pursuit of higher quarterly profits. As we all know from game theory, pure min-maxing doesn’t always produce the best long-term outcome. There has to be a balance. Nevertheless, many American companies are driven primarily by maximizing shareholder returns. In doing so, they can end up shooting themselves in the foot, making decisions that inflate short-term financial results while ultimately reducing their long-term profitability.
China, by contrast, has a quasi-socialist market economy under a single-party government. It has invested heavily in developing strategic industries, including electric vehicles. The government sets national priorities and can exert enormous influence over companies. If corporate leadership fails to meet those objectives, it can be replaced far more easily than in Western economies.
In the United States, corporations instead spend enormous sums lobbying politicians to pass laws favorable to their interests. But, as discussed above, relentlessly optimizing for short-term gains doesn’t always produce the best long-term results.
That’s one reason Chinese cars are so inexpensive. Or rather, they’re arguably priced closer to what cars should cost. The real question may be why cars in the United States have become so expensive. Automakers cite rising costs, regulations, technology, and financing practices, but prices seem to ratchet upward far more readily than they ever come back down.
The businessmen in China know they will be shot by the government if they are too exploitative.
Many reasons but two big ones are that they don’t pay employees like North America does, and I’m fully convinced they’re pulling the EEE technique to dominate the NA market once they’re in.
Because they have invested heavily into automation. A couple years ago the ford ceo went over there and came back terrified. He didn’t think it here was any way that american companies had a chance of competing.