Biden urged to ban China-built EVs by influential Capitol Hill lawmaker

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Facing stiff re-election odds in November, President Joe Biden is being urged by an influential lawmaker on Capitol Hill to shut the door to America’s market for good on electric vehicle manufacturers from China. 

Citing a flood of EVs exported to Europe, where every fifth car comes from China, Ohio’s senior senator on Thursday warned of an “existential threat to the American auto industry” in an open letter he posted to the White House.

“Tariffs are insufficient to stop their attack on American manufacturing,” wrote Sherrod Brown, chair of the Senate Banking Committee. “For this reason, the United States must ban Chinese-made EVs as soon as possible. This is a matter of economic and national security.”

What Brown didn’t say is that a chief culprit in the flood of Chinese-built EVs to Europe is Tesla.

Were it not for 25% duties the U.S. levies on cars from China, it is more than conceivable that Elon Musk would be importing at least some of his Model 3 and Model Y cars into America from his factory in Shanghai, just as he currently is doing for Canada. 

As the November election nears, a policy debate is raging internally as to whether the U.S. is gradually turning away from its free market roots or if Americans are starting to believe China is a freeloader taking advantage of the rules-based order.

For his part, Brown has firmly been part of the protectionist wing of the Democratic Party, and proudly cites his track record opposing what he calls unfair trade deals that hurt workers.

As a freshman representative for Ohio in 1993, he voted on the House floor against the North American Free Trade Agreement (NAFTA) and only five years ago did he declare he finally met a trade deal he could support. 

Importantly, his is one of the 34 senate seats up for grabs in November.

Brown will be running for a fourth term in office in the heavily contested battleground of Ohio, part of the industrial “Rust Belt” heartland and a state carried by Trump both in 2016 and 2020.

Every job at a carmaker helps sustain nearly a dozen elsewhere

The auto industry is a barometer for the overall health of a country’s manufacturing sector.

As an apex consumer, it sits atop a wide range of lower-tier suppliers operating within the steel, rubber, plastics, chemicals and electronics industries.

With its cavernous factories employing thousands of workers, it also traditionally has played a crucial role in building up a thriving middle class, the backbone of most advanced economies.

Troubles at a company like GM, Ford or Stellantis can therefore spillover to affect the broader picture. 

“Each auto job in the United States supports 11 other jobs,” Brown added, citing a figure from the lobby group Alliance for American Manufacturing.

China threatens to do in the EV space what it did in the solar panel industry some 15 years ago.

Back then, Germany was a global leader in manufacturing solar cells as part of an early effort to decarbonize their coal-heavy power grid.

Once Beijing identified the industry as strategic, it mobilized the country’s resources to quickly reach higher economies of scale and crush the competition on cost.

Both Musk and Trump have warned of the specter of a world-beating Chinese EV industry.

Critics argue the country’s enormous workforce of cheap labor, ability to quash dissent and near total disregard for industrial pollution and environmental standards allow it to undercut western competitors and defeat them at their own free market game.

“Ohio knows all too well how China illegally subsidizes its companies, putting our workers out of jobs and undermining entire industries, from steel to solar manufacturing,” Brown argued.

“We cannot allow China to bring its government-backed cheating to the American auto industry.”

Fortune has reached out to the White House and the Chinese embassy for comment.

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