After major European automakers a few months ago expressed deep concern about the competitive threat posed by Chinese electric car manufacturers, the concern is now coming from the United States, where Energy Secretary Jennifer Granholm warned that China may flood the American electric car market with low offers. The cost, weeks after President Joe Biden raised the same concerns.
In fact, the White House goes further than that “dumping issue” when it notes that the United States is investigating whether Chinese car imports pose risks to national security, as they can collect sensitive data about American citizens and American infrastructure and send it to China.
Economists believe, in exclusive statements to the “Eqtisad Sky News Arabia” website, that Chinese electric cars actually pose a competitive threat and a danger to American national security thanks to the battery industry and China’s dominance in their production, in addition to the technology and programs found in electric cars and the spying systems they may contain.
According to data from the China Association of Automobile Manufacturers, China exported nearly 5 million cars in 2023, overtaking Japan to become the first country in the world in terms of car exports last year, thanks to its fleet of electric vehicle manufacturers.
The US Secretary of Energy’s statement came during a panel discussion at an Axios event when she said: “We are very concerned about China conquering the auto industry in the United States even as we are now building this amazing manufacturing backbone. We have seen this happen in the solar industry… There has been a flood.” In the market”.
“China is investing huge sums of money to promote it. We need to understand that it is important for people to buy electric vehicles in an affordable way, but we can do it and we can keep our country safe,” Granholm said.
Great Chinese progress in production
Speaking to the “Eqtisad Sky News Arabia” website, the economist and member of the Board of Trustees of the Middle East Center for Economic Studies, Hashem Akl, explained that Chinese electric cars pose a threat to American and European national security as well for two basic reasons:
• The first is because the electric car battery industry is a distinctly Chinese industry and Chinese dominance over its production is clear.
• The second is due to software technology found in electric cars, which allows from time to time to modify and introduce updates to these programs and the spying and surveillance systems they may contain that pose a threat to national security.
He indicated that US President Joe Biden will take steps against Chinese automakers to prevent them from selling electric cars in the United States due to these security risks.
Biden said in a statement, “China’s policies could flood our market with its vehicles, which poses risks to our national security. I will not allow that to happen under my supervision.”
There are currently 2.4 million electric cars on the streets of the United States, and if China is allowed to flood the market, car manufacturers can track customer data, especially since cars are constantly connected to phones, and therefore America is considering imposing a ban on the import of Chinese cars, which, according to Akl, who explained In recent years, China has made great progress in increasing its production of electric cars, accounting for 69 percent of the total sales of new electric cars in the world last December alone. The number of electric car sales in China reached approximately nine million cars last year, while Nearly 1.4 million cars sold in the United States.
…and dominance in the battery industry
A member of the Board of Trustees of the Middle East Center for Economic Studies added: “The greatest danger is not the automobile industry, but rather the electric vehicle battery manufacturing technology, of which China dominates 90 percent. He recently raised the news of the exploration of BYD, the largest company in the industry. Chinese electric cars Sites to build a new factory in Mexico Concerns of American automakers, as the problem is that cars made in Mexico can be imported into the United States without paying customs tariffs, under the agreement between the United States, Mexico and Canada, which replaced the North American Free Trade Agreement ( NAFTA, especially since the cost of manufacturing electric cars in China is about a third less than the cost of manufacturing in the United States or the European Union.”
CEOs of the largest car manufacturers in Europe had pointed out in previous statements dating back to last September the threat coming from China to the car industry, as Christophe Perillat, CEO of Valeo, the auto parts manufacturer, said, “Chinese car manufacturers are thriving under… The electric car revolution, and that the competitive advantage enjoyed by Europe has become at risk, with the growth in demand for battery-powered electric cars.” While Volkswagen CEO Oliver Blume acknowledged “the challenge coming from the East,” President Luca de Meo said Renault executive said, “We are ready to participate in the fight with Chinese competitors.”
Decline in US auto exports
With American auto exports declining and companies such as General Motors reducing their international operations, China is seen as a threat to the American auto industry, according to a report recently published by the American network CNBC.
In turn, Fitch Ratings Agency said last December: “Chinese electric car makers have also launched new models in record times, and the outlook for Chinese car manufacturers remains stable despite the intense competition.”
Complex challenge
For his part, economic expert Hussein Al-Qamzi said in his interview with “Iqtisad Sky News Arabia” website: “The entry of Chinese electric cars into the United States market could be useful in strengthening American national security indirectly by stimulating the local electric car industry to innovate and expand.” “Thus reducing dependence on fossil fuels and foreign oil, this shift may have significant implications for energy security in the United States.”
The competitive market that will result from the introduction of Chinese electric vehicles may accelerate advances in technology, infrastructure, and manufacturing capabilities within the United States, and by fostering a more robust and self-sufficient electric vehicle ecosystem, the United States can reduce its exposure to geopolitical tensions and fluctuations in the global oil market. , which historically posed risks to national security, according to Al-Qamzi.
But at the same time, Al-Qamzi asserts that “the ability of Chinese electric vehicles to collect data on American citizens and American infrastructure poses a complex challenge to American national security, as concerns stem from the possibility of these vehicles being equipped with technology capable of monitoring or collecting sensitive information, which can be transferred again.” To China, this will drive enhanced cybersecurity standards and regulations for all vehicles sold in the United States, regardless of their country of origin.”
Strengthening the automotive industry’s cybersecurity framework could thus have an unintended benefit, leading to stronger protection against a wide range of cyber threats. This approach not only enhances innovation and economic resilience, but is also consistent with the environmental goals and long-term sustainability of America’s energy resources. According to his expression.
The economist Al-Qamzi added: “On the other hand, Chinese manufacturers wishing to enter the American market will ensure that their cars comply with a comprehensive set of standards imposed by the National Highway Traffic Safety Administration (NHTSA), which covers multiple areas of safety, including vehicle durability.” collision protection, electrical system, and new cyber safety standards. As such, Chinese electric vehicles officially sold in the United States have undergone stringent testing and certification processes to ensure they comply with these standards.
Intensifying pressures
The United States has intensified pressure on Chinese companies in recent years, introducing in October 2022 rules aimed at restricting China’s ability to access, obtain, or manufacture advanced semiconductor chips amid concerns that China may use them for military purposes. Last year, the United States announced… The United States announced new regulations preventing American chip designer Nvidia from selling advanced artificial intelligence chips to China.
While the US Senate recently voted in favor of approving a bill that may restrict dealing with Chinese biotechnology companies such as WuXi AppTec and BGI due to national security concerns.
