Ford and GM Consider Partnership to Combat Chinese Competition

( – With the Biden administration still pushing electric vehicles (EVs) as part of its green agenda, there’s a risk of Chinese manufacturers flooding the market with cheap models — and seriously damaging the US auto industry. Now the leading US car makers, Ford and General Motors, are considering a radical option to fight this threat. The long-time rivals are considering working together.

The best-known EVs in the world are produced by US company Tesla, but they’re not cheap — and they’re facing growing competition from BYD and other budget Chinese brands. Ford CEO Jim Farley says China benefits from construction costs up to 30% lower than what US manufacturers face, and that lets them sell at much lower prices.

Chinese brands that were unknown in the West just a few years ago are gaining market share; last year a quarter of all cars sold in Mexico were Chinese-made, and BYD is in talks about building a factory there. That would make it easy for them to boost sales in the US.

At an industry conference on February 15, Mary Barra, the CEO of GM, said that if there are ways the company can partner with others to develop EV technology, “We’re all in.” In his own presentation at the same conference, Ford’s Farley said his company was open to working with other manufacturers to reduce the cost of making EV batteries, which makes up a significant percentage of the vehicles’ cost.

The car that has Ford and GM worried is the BYD Seagull, a sub-$15,000 compact EV aimed at the budget car market. Introduced last April, more than 200,000 have already been sold, and it’s going on sale in South America this year. If BYD can introduce it to the US market it could be a serious challenge to US-made EVs — unless the big automakers can put aside their traditional rivalry and work together to bring down their prices.

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