Can the U.S. Catch Up to China on EVs?

Welcome to Foreign Policy’s China Brief.

The highlights this week: U.S. President Joe Biden announces expanded tariffs on Chinese electric vehicles, a Chinese spy goes public in Australia, and Russian President Vladimir Putin heads to China.

Biden Announces Tariff Increase

U.S. President Joe Biden announced a major expansion of tariffs on Chinese electric vehicles on Tuesday—quadrupling them to 100 percent—as well as raising tariffs on other sectors, such as steel, aluminum, and solar. Under Biden, the White House has largely kept the tariffs on Chinese goods that it inherited from the Trump administration, even amid a long-running review of the program. However, this is the first large tariff increase initiated by Biden.

The United States currently imports few Chinese electric vehicles, or EVs, but the auto industry sees them as a potentially major threat. The Chinese EV industry has boomed since the mid-2010s and grown exponentially since 2019, thanks to strong government subsidies and a thriving car market with little attachment to previous brands or the machismo of the gas-powered SUV.

It also helps that Chinese people generally drive within cities, not between them; EV range is still relatively limited compared to conventional vehicles. In China, the average annual mileage per vehicle has dropped slightly in recent years to around 11,000 kilometers (about 6,800 miles), compared to more than 20,000 kilometers (12,500 miles) in the United States. And electric vehicles have gone from a novelty to being everywhere, especially in the metropolises.

The Chinese government has also subsidized a large network of charging stations, which reached 8.6 million in 2023, making up 85 percent of fast chargers and 65 percent of slow chargers worldwide. (The United States only has around 64,000 chargers, most of them located in just a handful of states.) In China, wait times for chargers can still last more than an hour in key locations, but new battery swap programs may fix that.

The industry is moving so fast that Chinese EVs have an average shelf life of just 1.3 years—barely on the market before they’re pulled for a newer, better model. As a result, Chinese electric vehicles are not only good, but also cheap: as low as $19,000 for a full-sized car or $4,300 for a mini EV. All of this was funded in part by around $28 billion in subsidies between 2009 and 2022, but the industry is now mature enough that the government is phasing them out.

To be sure, Chinese EVs aren’t perfect. Safety standards in China are lower than in the stringent U.S. environment, although they are improving rapidly. Old models are also piling up in EV graveyards across the country, much as ride-sharing bicycles did after a boom and bust in the mid-2010s. But compared to the sluggish U.S. EV industry, China is years ahead.

That means that Chinese electric vehicles could hit the U.S. market like Japanese cars did in the 1970s and 80s, drowning out inferior U.S. goods through volume, quality, and price. The arrival of Japanese automakers came in part because they adapted to meet new environmental needs amid an oil crisis and increased regulation from the U.S. Environmental Protection Agency. Then, as now, there were U.S. drivers more concerned with appearance or size than with safety or sustainability—but they were and remain a market minority.

One of the problems with the United States looking back to the Cold War to formulate a China strategy is that in contrast with the Soviet Union, China makes brands that are globally competitive. U.S. consumers mostly haven’t realized how good and how cheap Chinese-made EVs are, and the new tariff increase will stop them from doing so. In theory, that protection will give the U.S. industry time to catch up rather than being flooded with Chinese goods.

But there’s a big question mark over whether the tariff increase serves U.S. interests, either for public needs or geopolitics. It’s also likely to stir up old divisions in the Biden administration between the hawks who see sticking it to China as a good in itself and the environmentalists who favor engagement. After all, Americans will be slower about switching to EVs if they’re left with costly options.

From the U.S. public’s point of view, the tariff increase blocks consumers from a mostly superior product. It also undermines the U.S. case against Chinese economic practices when Washington is happy to dip into the protectionist toolkit itself. Hypocrisy in global economic discussion will likely become even more common, especially if China keeps its market lead in a handful of key technologies. Playing catch-up isn’t a game that Washington is used to.

What We’re Following

Chinese spy in Australia. A former Chinese spy has gone public in Australia, appearing on the Australian Broadcasting Corporation’s (ABC) investigative journalism show Four Corners to discuss the years that he spent observing, harassing, and kidnapping dissidents overseas, including figures such as the political cartoonist known as Rebel Pepper.

The spy said that he worked for the Ministry of Public Security’s political-security protection bureau, providing documents to the ABC to back it up. That division of the Chinese police is charged with maintaining regime security. Its focus is primarily domestic but also includes the Chinese diaspora.

The ministry’s overseas efforts, as the ABC interview showed, tend to be sloppier and less professional than those of the Ministry of State Security, China’s key intelligence service. China’s kidnapping of dissidents and fugitives has been going on for years and usually involves luring targets from Western countries to more vulnerable third states, such as Thailand.

The interview is already stirring long-bubbling debate over Chinese influence in Australia, as another Four Corners investigation did in 2017. Australian politicians have raised concerns about the possibility of accidental facilitation of Chinese security efforts by Australia’s own police.

Putin visits China. Russian President Vladimir Putin on Thursday will begin a two-day visit to China, where he will reassert the close ties between the two authoritarian states and is sure to receive a prominent meeting with Chinese President Xi Jinping. China remains closely aligned with Russia amid its war in Ukraine, with Chinese state media often repeating and amplifying Russian propaganda.

U.S. and European hopes about separating China from Russia over the Ukraine issue have proved almost entirely fruitless, although sanctions threats have partially dissuaded Chinese financial institutions from Russian business.

Tech and Business

Baidu’s PR crisis. Search engine giant Baidu’s public relations chief, Qu Jing, has been forced to quit after massive backlash over short clips posted on Douyin, China’s version of TikTok. In the videos, Qu criticized workers for rallying against the work culture of Chinese tech firms, threatening to ruin the careers of employees who sent complaint letters to her office.

Baidu, which has faced previous criticism over its work culture, has said she wasn’t speaking for the firm. In China, tech workers commonly work from 9 a.m. to 9 p.m., six days per week—known by the shorthand “996.” The complaints made by tech workers tend to capture attention because they are vocal on social media, but the problems with work culture are far wider in China.

In theory, the government attempts to regulate to protect workers from abuse, but in practice, it usually sides with management. Workers are commonly fined for minor offenses, holidays are minimal, and unions are largely illegal.

Real estate measures. China’s endless battle to breathe new life into the property sector continues with a raft of new measures intended to encourage first-time buyers. However, prices and sales remain stubbornly flat, with March sales slumping by 46 percent compared to last year’s already-dire figures.

One increasingly popular measure among smaller cities is offering buyers hukou, the residence permits that control access to health care, credit, and social services. (China’s social welfare systems are tiered, with the cities having better hospitals and schools than the countryside.)

Urban upper-middle-class residents have largely fought the reform of the hukou system, fearful of migrant workers flooding their services. But property-linked hukou may be more acceptable to the existing stakeholders.

FP’s Most Read This Week

• Saudi Arabia Is on the Way to Becoming the Next Egypt by Steven A. Cook
• What Does America Want in Ukraine? by Emma Ashford, Joshua Shifrinson, and Stephen Wertheim
• No, This Is Not a Cold War—Yet by Michael Hirsh

A Bit of Culture

Qian Zhongshu (1910-1998) is one of the most famous Chinese literary figures of the 20th century, an author and polymath known mostly for his satirical novel Fortress Besieged. In this excerpt from his cutting story “Cat,” set in the salons of 1930s Beijing but written during the war-ravaged 1940s, he turns his eye on the Chinese intelligentsia and their newfound affection for Beijing, renamed Beiping by the Republican government in 1928.—Brendan O’Kane, translator

For in those last years before the war, Beiping—the Northern capital scorned by Tang Ruoshi, Xie Zaihang, and other literary worthies of the Ming and Qing dynasties as Peking, lowliest and filthiest of all cities—had become generally recognized as the most cultured, most beautiful city in all of China.

Even the dust that lay three feet thick over Beiping on windless days had taken on the hue and fragrance of antiquity, as if it held the last traces of the Mongol, Ming, and Qing dynasties, and specialists from museums in the younger European and American countries collected vials of it to put on exhibition. After the capital was moved south, Beiping lost the political function it had so long served, and became, like any useless and outmoded thing, a curiosity, an artifact.

Take a dilapidated junk shop, call it a venerable antique store, and without altering the facts of the matter in the slightest you will effect a marvelous transformation in the mind of the customer. Gone were the wretchedness and embarrassment of the junk shop rummager; in their place, the taste and discernment of the connoisseur.

And so it was that people who would have scorned the former now perused the latter, and people once forced by circumstance to rummage now found themselves elevated to the dignity of antiquarians. Residents of Beiping could count themselves worldly and cultured, could look down their noses at friends from Nanjing and Shanghai by right of residence. To claim that Shanghai or Nanjing could produce art or culture would have been as ridiculous as averring that the hands, feet, and gut were capable of independent thought.

The discovery of “Peking Man” at Zhoukoudian further proved the primacy of Beiping. Peking Man, in his day, had been the most advanced of all monkeys; so, today, was Beiping Man the most cultured of Chinese. The newspapers heralded the rise of the “Peking Set,” and the local intellectuals traced their spiritual lineage back to Peking Man—which was why they never called themselves the “Beiping Set,” even though the name of the city had changed.

The Peking Set were Southerners, almost to a man, and as proud of their newfound home as ever any Jews were of their adoptive countries. It was very nearly the only thing they ever spoke of. Since moving to Beiping, too, Mrs. Li’s athlete’s foot had cleared up—an unexpected side-benefit of living in the cultural center of the nation.