China’s EV Overcapacity Is Inevitable

Quick Summary:

China’s local governments have a strong interest in ensuring the survival and success of local car factories – regardless of market conditions.

Eric Thun detailed how local governments support carmakers through protectionist policies and awarding government procurement deals, and many of these old tactics have been applied to the EV industry.

This lack of firm exit has long been a problem for the Chinese economy, contributing to the decline in China’s total factor productivity (TFP) over the past decade and leading to overcapacity in sectors such as steel, solar panels, and other products.

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Article Details

Author / Journalist: Zhuoran Li

Category: Economy

Markets: United StatesChinaHong KongJapanSouth KoreaMongoliaVenezuelaVietnam

Topics: Auto Local Chinese Hefei Producers Companies China China’s Industry Support Government

Source Website Secure: Yes (HTTPS)

News Sentiment: Negative

Fact Checked: Legitimate

Article Type: News Report

Published On: 2024-08-06 @ 22:29:00 (12 hours ago)

News Timezone: GMT +8:00

News Source URL: thediplomat.com

Language: English

Article Length: 3632 words

Reading Time: 21 minutes read

Sentences: 185 lines

Sentence Length: 20 words per sentence (average)

Platforms: Desktop Web, Mobile Web, iOS App, Android App

Copyright Owner: © The Diplomat

News ID: 21961299

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