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## China is driving the EV revolution

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background-color: #fff

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### China offers more affordable BEVs across all range categories

Data scraped from autocango.com (China) and carsheet.io (USA)

Interactive version at https://jhelvy.github.io/science-2025/

---

### China offers more affordable BEVs across all range categories

Data scraped from autocango.com (China) and carsheet.io (USA)

Interactive version at https://jhelvy.github.io/science-2025/

---

background-color: #fff

## .center[China dominates mineral processing supply chain]

.font60[Source: https://thegraduatepress.org/2022/04/01/how-china-came-to-dominate-the-supply-chain-of-rare-earths-and-critical-minerals/]

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# How did this happen?

# .orange[*It's the subsidies, right?!*]

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### .center[Estimated $230B in subsidies (2009 - 2023)]

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### .center[Estimated $230B in subsidies (2009 - 2023)]

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# Institutions Matter

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# Why are _Chinese_ firms making the best EVs?<br>(and not multinationals)

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# The Chinese Joint Venture System

## 1980s: 以市场换技术 = “Exchange market for technology”

???

Past research suggests system has largely failed to transfer technology

(Brandt & Thun, 2010; Feng, 2010; Howell, 2016; Huang, 2003; Lazonick & Li, 2012; Nam, 2011)

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### “这就像吸食鸦片一样，一旦你沾染上了就永远也无法戒掉。”

何光远, 中国前机械工业部部长

<br>

### “It's like opium. Once you've had it you will be addicted forever.”

Guangyuan He, Former Minister of Machinery and Industry (Reuters, 2012)

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# .center[Who's going to make the EVs?]

<br>

### .font80[❌] Multinationals don't want to share cutting-edge technology

<br>

### .font80[❌] Chinese JV partners lack incentives to innovate

<br>

### &#x2705; Indigenous non-JV firms

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]

<br>

### Multinational OEMs dominate traditional auto sector through large JVs

<br>

### Indigenous non-JV firms dominate emerging EV sector

.font70[.left[Helveston, J. P., Y. Wang, V. Karplus, E. Fuchs (2018) “Institutional Complementarities: The Origins of Experimentation in China’s Plug-in Electric Vehicle Industry.” _Research Policy_. 48(1), pg. 206-222]]

]

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]

<br>

### Multinational OEMs dominate traditional auto sector through large JVs

<br>

### Indigenous non-JV firms dominate emerging EV sector

]

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# .center[EV Challenges in the US]

<br>

]

## 1) Policy environment

## 2) Consumer preferences

## 3) Affordability crisis

]

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# .center[**Decades of Policy Whiplash**]

<br>

### Obama<br>(2009–2016)

- $7,500 EV tax credit
- Goal: 1M EVs by 2015
- DOE battery R&D investment

]

### Trump I<br>(2017–2020)

- Proposed eliminating EV tax credits
- Rolled back fuel economy standards
- Withdrew from Paris Agreement

]

### Biden<br>(2021–2024)

- IRA: $369B in clean energy investment
- Expanded EV credits, domestic content rules
- 100% EV federal fleet goal

]

### Trump II<br>(2025–Now)

- Gutted IRA
- Rolled back fuel economy standards

]

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# .center[EV Challenges in the US]

<br>

]

## 1) Policy environment

## .red[2) Consumer preferences]

## 3) Affordability crisis

]

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## .center[US buyers are more opposed to EVs than Chinese buyers]

.font80[Helveston et al. (2015) "Will subsidies drive electric vehicle adoption? Measuring consumer preferences in the U.S. and China" _Transportation Research Part A: Policy and Practice_. 73, 96–112. DOI: [10.1016/j.tra.2015.01.002](https://www.sciencedirect.com/science/article/abs/pii/S0965856415000038)]

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### US buyers demand far more driving range than Chinese buyers

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# .center[EV Challenges in the US]

<br>

]

## 1) Policy environment

## 2) Consumer preferences

## .red[3) Affordability crisis]

]

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https://www.nytimes.com/interactive/2026/04/13/opinion/affordable-car-cost.html

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# The EV "Deserts" of America

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# The EV "Deserts" of America

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# How should the US respond to Chinese EVs?

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## .center[Bipartisan Response (So Far): **Ban Chinese tech**]

]

<br>

### **Block imports**: Steep tariffs on imported Chinese EVs, batteries (First Biden, continued w/Trump)

<br>

### **Block investment**: Stricter Foreign Entities of Concern (FEOC) rules

]

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## .center[Option A]

## .center[**Exclude Chinese EVs**]

### - China "cheated" its way to the top with subsidies

### - Chinese EVs are a security threat

]

## .center[Option B]

## .center[**Engage strategically**]

### - China built real competitive advantages in manufacturing and supply chains

### - Chinese EVs are winning markets, US OEMs are losing markets

]

---

## .center[The Tesla Example:<br>Transparent Cybersecurity]

<br>

### China allowed Tesla in via<br>targeted compliance:

- Store vehicle data **within China**
- Restrict operations near **sensitive areas**
- Use only **government-approved** mapping systems (Baidu)

]

]

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## .center[The European Model:<br>Block Imports, Welcome Chinese FDI]

<br>

### .center[**CATL**]

$7.6B battery plant in Debrecen<br>

100 GWh/year for Mercedes-Benz, BMW, Volkswagen

]

### .center[**BYD**]

First European EV manufacturing facility<br>

Producing BEVs and PHEVs for the European market

]

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# .center[US Opportunities]

## .center[Technology Licensing Agreements]

### **Ford-CATL**: Licensing battery technology in a Michigan plant

### **Challenge**: CATL recently added to DOD's list of "Chinese military companies"

]

## .center[Chinese FDI<br>into U.S.]

### **Gotion batteries**: Multi-billion dollar investments in Illinois and Michigan

### **Challenge**: Uncertainty around Foreign Entities of Concern (FEOC) status

]

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# Consumers aren't waiting for Washington

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---

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## The U.S. risks becoming an **"island of tailpipes"**

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# .center[Strategic Responses]

### 🇨🇦🇲🇽 **North American Integration**: Build sufficient scale through Canada and Mexico partnerships

### 📋 **Transparent Security Standards**: Develop compliance frameworks all connected vehicles must meet — *regardless of origin*

### 🔋 **Battery Manufacturing Focus**: Prioritize domestic production as platform for commercializing next-gen U.S. technologies

### 🤝 **Strategic Chinese Partnerships**: Pursue licensing agreements and FDI with targeted safeguards — not wholesale restrictions

### 📈 **Sustained Policy Support**: Restore and maintain IRA incentives long enough for investments to mature

---

<br>

# Thanks!

<br>

### Slides available at <span class="white-text">jhelvy.com/slides</span>

@jhelvy <svg aria-hidden="true" role="img" viewBox="0 0 496 512" style="height:1em;width:0.97em;vertical-align:-0.125em;margin-left:auto;margin-right:auto;font-size:inherit;fill:white;overflow:visible;position:relative;"><path d="M165.9 397.4c0 2-2.3 3.6-5.2 3.6-3.3.3-5.6-1.3-5.6-3.6 0-2 2.3-3.6 5.2-3.6 3-.3 5.6 1.3 5.6 3.6zm-31.1-4.5c-.7 2 1.3 4.3 4.3 4.9 2.6 1 5.6 0 6.2-2s-1.3-4.3-4.3-5.2c-2.6-.7-5.5.3-6.2 2.3zm44.2-1.7c-2.9.7-4.9 2.6-4.6 4.9.3 2 2.9 3.3 5.9 2.6 2.9-.7 4.9-2.6 4.6-4.6-.3-1.9-3-3.2-5.9-2.9zM244.8 8C106.1 8 0 113.3 0 252c0 110.9 69.8 205.8 169.5 239.2 12.8 2.3 17.3-5.6 17.3-12.1 0-6.2-.3-40.4-.3-61.4 0 0-70 15-84.7-29.8 0 0-11.4-29.1-27.8-36.6 0 0-22.9-15.7 1.6-15.4 0 0 24.9 2 38.6 25.8 21.9 38.6 58.6 27.5 72.9 20.9 2.3-16 8.8-27.1 16-33.7-55.9-6.2-112.3-14.3-112.3-110.5 0-27.5 7.6-41.3 23.6-58.9-2.6-6.5-11.1-33.3 2.6-67.9 20.9-6.5 69 27 69 27 20-5.6 41.5-8.5 62.8-8.5s42.8 2.9 62.8 8.5c0 0 48.1-33.6 69-27 13.7 34.7 5.2 61.4 2.6 67.9 16 17.7 25.8 31.5 25.8 58.9 0 96.5-58.9 104.2-114.8 110.5 9.2 7.9 17 22.9 17 46.4 0 33.7-.3 75.4-.3 83.6 0 6.5 4.6 14.4 17.3 12.1C428.2 457.8 496 362.9 496 252 496 113.3 383.5 8 244.8 8zM97.2 352.9c-1.3 1-1 3.3.7 5.2 1.6 1.6 3.9 2.3 5.2 1 1.3-1 1-3.3-.7-5.2-1.6-1.6-3.9-2.3-5.2-1zm-10.8-8.1c-.7 1.3.3 2.9 2.3 3.9 1.6 1 3.6.7 4.3-.7.7-1.3-.3-2.9-2.3-3.9-2-.6-3.6-.3-4.3.7zm32.4 35.6c-1.6 1.3-1 4.3 1.3 6.2 2.3 2.3 5.2 2.6 6.5 1 1.3-1.3.7-4.3-1.3-6.2-2.2-2.3-5.2-2.6-6.5-1zm-11.4-14.7c-1.6 1-1.6 3.6 0 5.9 1.6 2.3 4.3 3.3 5.6 2.3 1.6-1.3 1.6-3.9 0-6.2-1.4-2.3-4-3.3-5.6-2z"/></svg><br>
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]]]

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# Extra Slides

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## China's EV subsidies are on par with typical subsidies needed to start an industry

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### China offers more affordable BEVs across all range categories

Data scraped from autocango.com (China) and carsheet.io (USA)

Interactive version at https://jhelvy.github.io/science-2025/

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# How many dealerships are carrying EVs?

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## **4/5** dealers have _new_ BEV; **2/5** dealers have _used_ BEV

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]

## Most dealers carry very few EVs

]

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## .center[EV percentage of vehicle listings for $40-50k price bin
]

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<br>

## **Majority of BEV listings in high-price segments**

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# How hard is it to get to a PEV dealer?

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background-color: #fff

### **Vehicle accessibility metric**:<br>Road travel time from census tract centroid to<br>nearest dealership with a target vehicle

*Road travel times obtained using Open Source Routing Machine (OSRM)

---

]

## PEV travel times are converging towards conventional vehicle times

80% of pop:

- CV in ~12 min
- PEV in ~22 min (2024)
- PEV in ~60 min (2016)

]

---

]

### Additional travel times (PEV - CV) by demographic blocks shows disparities

Places with worse PEV access:

- Lower income areas 
- Rural areas
- Republican strongholds

]

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### .center[**Local vehicle market**: Vehicles in 90 minute driving isochrone]

Combine ML algorithm of predicted household vehicle budget (using Census data) with local market characteristics

]

]

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