Energy Secretary Jennifer Granholm and President Joe Biden have raised concerns about China's potential to dominate the U.S. electric vehicle (EV) market. Granholm warned that China could flood the market, echoing similar tactics seen in the solar industry. China has already become the world's largest car exporter, with nearly 5 million vehicles exported in 2023, surpassing Japan.Chinese EV manufacturers are rapidly releasing new models, and despite increasing competition, their outlook remains stable. Granholm emphasized the importance of affordable EVs while ensuring national security, hinting at China's potential to collect sensitive data through vehicle imports.
To counter this, the U.S. is taking steps to boost domestic EV supply chains. The Inflation Reduction Act provides tax credits for vehicles assembled in North America with critical mineral and battery components meeting specific requirements. Vehicles with components from "foreign entities of concern," including China, are not eligible for these incentives.
The U.S. has also implemented measures to restrict China's access to advanced semiconductor chips, amid concerns over their military application. Additionally, regulations have been imposed to prevent the sale of advanced AI chips to China, and a recent Senate bill aims to restrict business with Chinese biotech firms on national security grounds.
Overall, the U.S. is working to protect its EV market from Chinese dominance, emphasizing domestic production and supply chain security.