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NIO Battery Swapping Station Sinopec
Image courtesy NIO

Cars

Is 2022 The Year Chinese Cars Come To America?

Chinese car companies have their eyes on the US market. NIO and Geely want to be at the head of the line.

There are Chinese-made cars in America right now this very minute, but no one is advertising that fact. With all the finger pointing and saver rattling between the US and China, the two companies bringing cars made in China to the US — Shhhh! Let’s just call them Team G and Team V. — are keeping it very much on the down low. And who could blame them? Many Americans are not kindly disposed toward the Middle Kingdom, believing it is engaged in all sorts of nefarious activities designed to purloin trade secrets from American companies.

The extent of the animosity toward Chinese companies was made abundantly clear recently when BYD was excluded from receiving any benefit from the money appropriated by Congress to promote the purchase of electric buses, despite the fact that BYD is the largest electric bus manufacturer in America and uses exclusively union workers to assemble its products. Can you imagine the uproar if a Chinese manufacturer sold new cars in the US that are eligible for the federal EV tax credit? That’s exactly what might happen in 2022 if Nio and Geely have their way.

NIO Is Hiring In America

According to CnEVPost, last Thursday NIO posted three job openings on LinkedIn for positions in San Jose, California, all related to the company’s infrastructure plans there. The three positions are head of architecture and design, head of power strategy, and head of user infrastructure, construction, and readiness. Here’s more about each of those positions, each of which requires at least 10 years of experience.

  • Head of architecture and design: Drive and develop the design and architecture of NIO’s core user infrastructure in the Americas, including the localization and standardization of design for each infrastructure category. From site selection to final completion, influence and oversee the infrastructure build out process and plans to ensure that the final build out completely represents the design details agreed to with NIO’s executive management.
  • Head of power strategy: Develop and articulate a clear view of the regulations and the incentives governing the US EV charging infrastructure participants and align NIO stakeholders to that view. Develop the pricing strategy for NIO’s power offerings, detailing how NIO’s capabilities can optimize all components of the system, including energy purchase, acquisition, storage, and delivery.
  • Head of user infrastructure construction and readiness: Develop a detailed infrastructure readiness plan for each infrastructure category, aligned with business objectives and budgets. Secure executive approval for the plan, and drive the execution of the plan. From site selection to final completion, own the infrastructure build out process and plans to ensure that the final build out completely represents the design vision and expectations.

At the NIO Day 2021 event on December 18, William Li, founder and CEO of NIO, announced the company plans to start selling cars in enter Germany, the Netherlands, Sweden and Denmark in 2022. It has already begun selling its cars and installing its proprietary battery swapping stations in Norway this year. NIO’s goal is to serve users in more than 25 countries and regions worldwide by 2025, including the United States, Western Europe, Australia and New Zealand.

Li added, “We can’t let users not get good service for a long time, and we will care whether we have the ability to provide users with a convenient experience like a fuel car. This is a very basic starting point for us. If we think we can’t do it, we would rather not enter this market, or if we can’t do it in the short term, we would rather wait. We have done it in a country as big as China, so there is no reason why we can’t do it in Europe or in the United States. We are certainly a Chinese company, but we are also a company founded and supported by global resources and our colleagues come from more than 40 countries,” he said.

Geely/Nissan Link Has Implications For US Market

Renault and Geely will soon announce a joint venture agreement. Sources tell Reuters the two companies will offer a new lineup of green cars that use Geely’s Compact Modular Architecture — a midsize vehicle platform shared by Geely and Volvo — and share Geely’s supply chains and manufacturing facilities in China. Renault will focus on vehicle design, sales, and marketing for its newly defined brand in China, the sources said.

For Geely, the deal could mean a production foothold in South Korea and access to Renault’s assembly plant in the country, where the latter has been making and selling cars for over two decades via a local brand with a division of Samsung Group. Sources say Geely is hoping to produce its Lynk & Co 01 — currently available as either a car with a conventional gasoline engine, a hybrid, or a plug-in hybrid — in South Korea. One source only the conventional car and the hybrid will be built in that country.

A Back Door To US Market

Now here’s an interesting tidbit. The sources tell Reuters that cars manufactured in South Korea are allowed into the US under the terms of an existing free trade agreement duty free. According to CNBC, this safe haven provision allows cars made by Hyundai, Kia, and GM in South Korea to be imported to the US without paying an import tariff. Currently, cars imported from China are subject to a 27.5% tariff. The upshot is that Lynk & Co vehicles manufactured in South Korea would also be allowed in to the US duty free — at least in theory. Given the current nastiness in US-China trade relations, some US automakers may go scurrying to Washington to try to find a way to prevent that from happening.

And What Of Renault?

The much ballyhooed Renault Nissan Alliance — which has been teetering on the brink of collapse since Carlos Ghosn evaded Japanese authorities — may suffer another setback as a result of this new joint venture with Geely. Both Renault and Nissan had manufacturing agreements with Dongfeng ie platforms and other vehicle components to reduce manufacturing and other costs. Renault dissolved its relationship with Dongfeng and exited the Chinese market last year. This new agreement with Geely may provide a way to re-enter the Chinese market without Nissan. Reuters says slyly, “It was not immediately clear how Renault’s partnership with Geely would impact the Renault-Nissan alliance.” You can say that again twice!

The Takeaway

The nastiness in trade relations between China and the US may delay the entry of Chinese-made cars into the US, but it won’t stop them. The Hyundai Excel and the Yugo were crappy cars, but they were cheap and Americans couldn’t get enough of them. Chinese companies will be content to play in the low priced segment of the market — for a while. But 10 years from now, despite political bickering, Chinese cars will be as common as Toyotas and Hyundais. You can take that to the bank.

 
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Written By

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. 3000 years ago, Socrates said, "The secret to change is to focus all of your energy not on fighting the old but on building the new." Perhaps it's time we listened?

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