US hidden agenda in EV sector unmasked

China's electric vehicle (EV) industry has come under intense scrutiny, with the United States and the European Union deciding to launch investigations into Chinese-made EVs to determine whether they pose a threat to national security. Ostensibly projected as efforts to promote fair competition and safeguard national security, such investigations suggest the US has a hidden agenda rooted in protectionism and strategic apprehension.

The US claims that China's EV sector is plagued by overcapacity, and the Chinese government gives unfair subsidies to EV manufacturers (as well as buyers). However, such accusations are unfounded, divorced from reality, and those leveling such accusations overlook the dynamic nature of capacity building inherent in rapidly evolving industries. Also, those accusing China of giving price subsidies fail to acknowledge the market dynamics and technological prowess that underpin China's competitive edge. Independent analyses have consistently shown the efficiency and cost-effectiveness of Chinese EVs, dispelling the narrative of unfair advantage.

Chinese-made EVs are highly cost-effective because of China's efficient supply chains, technological prowess and market dynamics, rather than subsidies and/or dumping policy. A comprehensive analysis by UBS shows that the overall cost of EV-maker BYD's Dolphin model is 35 percent lower than that of similar models manufactured by Volkswagen in Europe.