tariffs

uk-online-safety-law-musk-hates-kicks-in-today,-and-so-far,-trump-can’t-stop-it

UK online safety law Musk hates kicks in today, and so far, Trump can’t stop it

Enforcement of a first-of-its-kind United Kingdom law that Elon Musk wants Donald Trump to gut kicked in today, with potentially huge penalties possibly imminent for any Big Tech companies deemed non-compliant.

UK’s Online Safety Act (OSA) forces tech companies to detect and remove dangerous online content, threatening fines of up to 10 percent of global turnover. In extreme cases, widely used platforms like Musk’s X could be shut down or executives even jailed if UK online safety regulator Ofcom determines there has been a particularly egregious violation.

Critics call it a censorship bill, listing over 130 “priority” offenses across 17 categories detailing what content platforms must remove. The list includes illegal content connected to terrorism, child sexual exploitation, human trafficking, illegal drugs, animal welfare, and other crimes. But it also broadly restricts content in legally gray areas, like posts considered “extreme pornography,” harassment, or controlling behavior.

Matthew Lesh, a public policy fellow at the Institute of Economic Affairs, told The Telegraph that “the idea that Elon Musk, or any social media executive, could be jailed for failing to remove enough content should send chills down the spine of anyone who cares about free speech.”

Musk has publicly signaled that he expects Trump to intervene, saying, “Thank goodness Donald Trump will be president just in time,” regarding the OSA’s enforcement starting in March, The Telegraph reported last month. The X owner has been battling UK regulators since last summer after resisting requests from the UK government to remove misinformation during riots considered the “worst unrest in England for more than a decade,” The Financial Times reported.

According to Musk, X was refusing to censor UK users. Attacking the OSA, Musk falsely claimed Prime Minister Keir Starmer’s government was “releasing convicted pedophiles in order to imprison people for social media posts,” FT reported. Such a post, if seen as spreading misinformation potentially inciting violence, could be banned under the OSA, the FT suggested.

Trump’s UK deal may disappoint Musk

Musk hopes that Trump will strike a deal with the UK government to potentially water down the OSA.

UK online safety law Musk hates kicks in today, and so far, Trump can’t stop it Read More »

the-same-day-trump-bought-a-tesla,-automaker-moved-to-disrupt-trade-war

The same day Trump bought a Tesla, automaker moved to disrupt trade war


Tesla hopes to slow down Trump’s tit-for-tat tariffs amid financial woes.

Donald Trump and White House Senior Advisor, Tesla and SpaceX CEO Elon Musk deliver remarks next to a Tesla Model S on the South Lawn of the White House on March 11, 2025 in Washington, DC. Credit: Andrew Harnik / Staff | Getty Images News

Elon Musk’s Tesla is waving a red flag, warning that Donald Trump’s trade war risks dooming US electric vehicle makers, triggering job losses, and hurting the economy.

In an unsigned letter to the US Trade Representative (USTR), Tesla cautioned that Trump’s tariffs could increase costs of manufacturing EVs in the US and forecast that any retaliatory tariffs from other nations could spike costs of exports.

“Tesla supports a robust and thorough process” to “address unfair trade practices,” but only those “which, in the process, do not inadvertently harm US companies,” the letter said.

The carmaker recommended that the USTR—in its ongoing review of unfair trade practices and investigation into harms of non-reciprocal trade agreements—”consider the downstream impacts of certain proposed actions taken to address unfair trade practices.”

According to Tesla, the current process to address unfair trade threatens to harm its more than 70,000 employees, and more broadly could trigger job losses and revenue dips in the US auto industry. It could also disrupt supply chains, as Tesla claims that even its best efforts prove it would be “impossible” to source all parts from the US currently.

“Even with aggressive localization of the supply chain, certain parts and components are difficult or impossible to source within the United States,” the letter said, asking the USTR to “evaluate domestic supply chain limitations.”

If left unchanged, the process could make the US less competitive in global auto markets, Tesla warned, recommending that the “USTR should investigate ways to avoid these pitfalls in future actions.”

Moving forward, Tesla recommends that the USTR “take into account” how the trade war could hurt US exporters, as “US exporters are inherently exposed to disproportionate impacts when other countries respond to US trade actions.”

In the letter, Tesla appears to suggest that Trump’s tariffs were rushed, suggesting that “US companies will benefit from a phased approach that enables them to prepare accordingly and ensure appropriate supply chain and compliance measures are taken.”

Tesla was not alone in submitting comments to the USTR. So far, hundreds of companies have chimed in, many hoping to push back on Trump’s aggressive tariffs regime.

Among them was a trade group representing major foreign automakers like BMW, Honda, and Toyota—Autos Drive America—which agreed with Tesla that the USTR should slow Trump down and require considerations about long-term impacts of sudden actions to address unfair trade. They similarly warned that imposing “broad-based tariffs will disrupt production at US assembly plants,” Reuters reported.

“Automakers cannot shift their supply chains overnight, and cost increases will inevitably lead to some combination of higher consumer prices, fewer models offered to consumers and shut-down US production lines, leading to potential job losses across the supply chain,” the group said.

Disrupting Trump trade war may be tough

Last week, Trump’s 25 percent tariffs on Canada and Mexico took effect, likely frustrating Tesla, which relies on a small parts manufacturer in Canada, Laval Tool, to source parts for the already costly molds for its Cybertrucks. Those tariffs threatened to spike costs beyond the current rate of nearly $500,000 per mold at a time when the Cybertruck hasn’t been selling well, InsideEVs reported. And for Tesla, Trump’s China tariffs may hit even harder, as China is Tesla’s second biggest market.

On the day that those tariffs kicked in, the head of the Alliance for Automotive Innovation—which represents all the major US automakers, except Tesla—John Bozzella warned that “all automakers will be impacted by these tariffs on Canada and Mexico,” Reuters reported. He joined others predicting price hikes on cars coming soon, perhaps as high as 25 percent.

Tesla’s letter to the USTR is notably unsigned, despite CEO Musk’s close allyship with Trump as a senior advisor in his administration—suggesting Musk may be hesitant to directly criticize Trump’s trade war or his opposition to EVs.

Many have questioned how long Musk’s friendship with Trump can possibly last, given their strong personalities and seeming unwillingness to bend to critics. At the beginning of this administration, Musk seemed unafraid to question Trump despite teaming up with him. Perhaps most notably, Trump’s team was supposedly “furious” after Musk trashed Trump’s $500 billion “Stargate” project with OpenAI, Politico reported, which Trump had hyped as “tremendous” and “monumental.”

“It’s clear he has abused the proximity to the president,” a Trump ally granted anonymity told Politico. “The problem is the president doesn’t have any leverage over him and Elon gives zero fucks.”

Officially, Trump downplayed Musk’s public criticism of his major announcement, seeming to understand that Musk views OpenAI CEO Sam Altman—whom Musk is suing for making a “fool” out of him—as an enemy.

“He hates one of the people in the deal,” Trump told a reporter who asked if Musk’s comments had bothered him, confirming, “it doesn’t.”

Despite a long history of harsh comments about EVs, Trump has recently hyped Tesla cars, which Tesla noted in its letter to the USTR, further its mission “to accelerate the world’s transition to sustainable energy.” The BBC noted Tesla’s letter was sent the same day that Trump hosted a White House event where the president vowed to purchase a Tesla in defiance of Tesla boycotts and protests that some believe are driving a steep Tesla stock fall and even degrading the price of used Teslas. In a Truth Social post, Trump claimed that he was buying a Tesla to support “one of the World’s great automakers” and “Elon’s ‘baby,'” alleging that protests and boycotts were somehow illegal.

The Hill suggested that their friendship isn’t likely to end soon, even though Trump has supposedly complained in private about taunts suggesting that Musk is really the president or somehow pulling the strings, The Independent reported.

Musk may be settling into a good dynamic with Trump after spending ample time at the president’s side, reportedly even joining meetings and sensitive calls. Or perhaps Musk is giving Trump space to call the shots, after Musk’s Department of Government Efficiency’s aggressive cuts at federal agencies sparked backlash that finally pushed Trump to rein in Musk’s power a little.

Musk’s proximity to Trump was predicted to be a boon to his businesses, but Tesla has been stuck in a slump that seemingly some Trump allies think Trump might fear makes him look weak, The New Republic reported. But Trump has made tariffs the core of his trade policy, hoping aggressive taxes will force more industry into the US, and it’s hard to see how Musk could easily influence him to shift gears.

In Tesla’s letter, the automaker told the USTR that it was “essential to support US manufacturing jobs” by ensuring that cost-prohibitive tariffs or other import restrictions don’t disrupt critical auto industry supply chains. For Tesla, the stakes couldn’t be higher, as the company reminded the USTR that “Tesla was ranked as the world leader in the transition to vehicle electrification,” manufacturing “the best-selling car in the world (EV or otherwise).”

“Tesla’s US facilities support over 70,000 employees and are responsible for billions of dollars of US investment and economic activity each year,” Tesla’s letter said.

Photo of Ashley Belanger

Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.

The same day Trump bought a Tesla, automaker moved to disrupt trade war Read More »

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TSMC to invest $100B as Trump demands more US-made chips, report says

Currently, TSMC only builds its most advanced chips in Taiwan. But when the most advanced US fabs are operational, they’ll be prepared to manufacture “tens of millions of leading-edge chips” to “power products like 5G/6G smartphones, autonomous vehicles, and AI datacenter servers,” the Commerce Department said in 2024.

TSMC has not confirmed the WSJ’s report but provided a statement: “We’re pleased to have an opportunity to meet with the President and look forward to discussing our shared vision for innovation and growth in the semiconductor industry, as well as exploring ways to bolster the technology sector along with our customers.”

Trump threat of semiconductor tariffs still looms

Advanced chips are regarded as critical for AI innovation, which Trump has prioritized, as well as for national security.

Without a steady supply, the US risks substantial technological and economic losses as well as potential weakening of its military.

To avert that, Trump campaigned on imposing tariffs that he claimed would drive more semiconductor manufacturing into the US, while criticizing the CHIPS Act for costing the US billions. Following through on that promise, in February, he threatened a “25 percent or more tariff” on all semiconductor imports, the WSJ reported. According to CNBC, Trump suggested those tariffs could be in effect by April 2.

“We have to have chips made in this country,” Trump said last month. “Right now, everything is made in Taiwan, practically, almost all of it, a little bit in South Korea, but everything—almost all of it is made in Taiwan. And we want it to be made—we want those companies to come to our country, in all due respect.”

While it’s unclear if Trump plans to overtly kill the CHIPS Act, his government funding cuts could trigger a future where the CHIPS Act dies with no workers left to certify that companies meet requirements for ongoing award disbursements, a semiconductor industry consultant group, Semiconductor Advisors, warned in a statement last month.

“If I were running a chip company, I would not count on CHIPS Act funding, even if I had a signed contract,” SA’s statement said.

TSMC to invest $100B as Trump demands more US-made chips, report says Read More »

tariffs-will-“blow-a-hole”-in-the-us-auto-industry,-says-ford-ceo

Tariffs will “blow a hole” in the US auto industry, says Ford CEO

The US has had to pause some of these new tariffs almost immediately, and the proposed 25 percent tariffs against any Canadian or Mexican imports have been delayed for a month. But yesterday, the president imposed 25 percent tariffs on any imported steel or aluminum. When last in office, Trump also imposed tariffs on steel (25 percent) and aluminum (10 percent), igniting a trade war and cutting US steel imports by far more than domestic steel production was able to rise to meet it.

“Let’s be real honest: long-term, 25 percent tariffs across the Mexican and Canadian border would blow a hole in the US industry that we have never seen,” Farley said, pointing out that the tariffs would “give free rein” to OEMs that import their vehicles from Japan, South Korea, or Europe.

As the CEO of Polestar told Ars last week, the main thing automakers want is clarity. The last they want is chaos, where the rules have changed from one day to the next based on whim. At the conference, Farley had a similar message. “They need to understand there’s a lot of policy uncertainty here, but in the meantime, we’re scrambling to manage the company as professionals,” he said.

Tariffs will “blow a hole” in the US auto industry, says Ford CEO Read More »

tariffs-may-soon-spike-costs-of-cars,-household-goods,-consumer-tech

Tariffs may soon spike costs of cars, household goods, consumer tech


“A little pain”: Trump finally admits tariffs heap costs on Americans.

Canadian and American flags are seen at the US/Canada border March 1, 2017, in Pittsburg, New Hampshire. Credit: DON EMMERT / Staff | AFP

Over the weekend, President Trump issued executive orders heaping significant additional tariffs on America’s biggest trading partners, Canada, China, and Mexico.

To justify the tariffs—”a 25 percent additional tariff on imports from Canada and Mexico and a 10 percent additional tariff on imports from China”—Trump claimed that all partners were allowing drugs and immigrants to illegally enter the US. Declaring a national emergency under the International Emergency Economic Powers Act, Trump’s orders seemed bent on “downplaying” the potential economic impact on Americans, AP News reported.

But very quickly, the trade policy sparked inflation fears, with industry associations representing major US firms from many sectors warning of potentially derailed supply chains and spiked consumer costs of cars, groceries, consumer technology, and more. Perhaps the biggest pain will be felt by car buyers already frustrated by high prices if car prices go up by $3,000, as Bloomberg reported. And as Trump eyes expanding tariffs to the European Union next, January research from the Consumer Technology Association showed that imposing similar tariffs on all countries would increase the cost of laptops by as much as 68 percent, game consoles by up to 58 percent, and smartphones perhaps by 37 percent.

With tariffs scheduled to take effect on Tuesday, Mexico moved fast to negotiate a one-month pause on Monday, ABC News reported. In exchange, Mexico promised to “reinforce” the US-Mexico border with 10,000 National Guard troops.

The pause buys Mexico a little time to convince the Trump administration—including Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, and potentially Commerce Secretary nominee Howard Lutnick—to strike a “permanent” trade deal, ABC News reported. If those talks fall through, though, Mexico has indicated it will retaliate with both tariff and non-tariff measures, ABC News reported.

Even in the best-case scenario where no countries retaliate, the average household income in 2025 could drop by about $1,170 if this week’s new tariffs remain in place, an analysis from the Budget Lab at Yale forecast. With retaliation, average income could decrease by $1,245.

Canada has already threatened to retaliate by imposing 35 percent tariffs on US goods, although that could change, depending on the outcome of a meeting this afternoon between Trump and outgoing Prime Minister Justin Trudeau.

Currently, there’s seemingly tension between the Trump administration and Trudeau, however.

On Saturday, Trudeau called Trump’s rationale for imposing tariffs on Canada—which Trudeau noted is responsible for less than 1 percent of drugs flowing into the US—”the flimsiest pretext possible,” NBC News reported.

This morning, the director of the White House’s National Economic Council, Kevin Hassett, reportedly criticized Canada’s response on CNBC. While Mexico is viewed as being “very, very serious” about Trump’s tariffs threat, “Canadians appear to have misunderstood the plain language of the executive order and they’re interpreting it as a trade war,” Hassett said.

On the campaign trail, Trump promised to lower prices of groceries, cars, gas, housing, and other goods, AP News noted. But on Sunday, Trump clearly warned reporters while boarding Air Force One that tariffs could have the opposite effect, ABC News reported, and could significantly worsen inflation the longer the trade policy stands.

“We may have short term, some, a little pain, and people understand that, but, long term, the United States has been ripped off by virtually every country in the world,” Trump said.

Online shoppers, car buyers brace for tariffs

In addition to imposing new tariffs on these countries, Trump’s executive orders also took aim at their access to the “de minimus” exemption that allows businesses, including online retailers, to send shipments below $800 into the US without being taxed. That move could likely spike costs for Americans using popular Chinese retail platforms like Temu or Shein.

Before leaving office, Joe Biden had threatened in September to alter the “de minimus” rule, accusing platforms like Temu or Shein of flooding the US with “huge volumes of low-value products such as textiles and apparel” and making “it increasingly difficult to target and block illegal or unsafe shipments.” Following the same logic, it seems that Trump wants to exclude Canada, China, and potentially Mexico from the duty-free exemption to make it easier to identify illegal drug shipments.

Temu and Shein did not respond to Ars’ request to comment. But both platforms in September told Ars that losing the duty-free exemption wouldn’t slow their growth. And both platforms have shifted business to keep more inventory in the US, CNBC reported.

Canada is retaliating, auto industry will suffer

While China has yet to retaliate to defend such retailers, for Canada, the tariffs are considered so intolerable that the country immediately ordered tariffs on beverages, cosmetics, and paper products flowing from the US, AP News reported. Next up will be “passenger vehicles, trucks, steel and aluminum products, certain fruits and vegetables, beef, pork, dairy products, aerospace products, and more.”

If the trade wars further complicate auto industry trade in particular, it could hurt US consumers. Carmakers globally saw stocks fall on expectations that Trump’s tariffs will have a “profound impact” on the entire auto industry, CNBC reported. And if tariffs expand into the EU, an Oxford Economics analysis suggested, the cost of European cars in the US market would likely increase while availability decreases, perhaps crippling a core EU market and limiting Americans’ choice in vehicles.

EU car companies are already bracing for potential disruptions. A spokesperson for Germany-based BMW told CNBC that tariffs “hinder free trade, slow down innovation, and set a negative spiral in motion. In the end, they are detrimental to customers, making products more expensive and less innovative.” A Volkswagen spokesperson confirmed the company was “counting on constructive talks between the trading partners to ensure planning security and economic stability and to avoid a trade conflict.”

Right now, Canada’s auto industry appears most spooked by the impending trade war, with the president of Canada’s Automotive Parts Manufacturers’ Association, Flavio Volpe, warning that Canada’s auto sector could “shut down within a week,” Bloomberg reported.

“At 25 percent, absolutely nobody in our business is profitable by a long shot,” Volpe said.

According to Bloomberg, nearly one-quarter of the 16 million cars sold in the US each year will be hit with duties, adding about $60 billion in industry costs. Seemingly the primary wallet drain will be car components that cross the US-Canada and US-Mexico borders “as many as eight times during production” and, should negotiations fail, could be getting hit with tariffs both ways. Tesla, for example, relies on a small parts manufacturer in Canada, Laval Tool, to create the molds for its Cybertruck. It already costs up to $500,000 per mold, Bloomberg noted, and since many of the mold components are sourced from Canada currently, that cost could go up at a time when Cybertruck sales already aren’t great, InsideEVs reported.

Tariffs “necessary”

William Reinsch, senior adviser at the Center for Strategic and International Studies and a former US trade official, told AP News that Trump’s new tariffs on raw materials disrupting the auto industry and others don’t seem to “make much economic sense.”

“Historically, most of our tariffs on raw materials have been low because we want to get cheaper materials so our manufacturers will be competitive … Now, what’s he talking about? He’s talking about tariffs on raw materials,” Reinsch said. “I don’t get the economics of it.”

But Trump has maintained that tariffs are necessary to push business into the US while protecting national security. Industry experts have warned that hoping Trump’s tariffs will pressure carmakers to source all car components within the US is a “tough ask,” as shifting production could take years. Trump seems unlikely to back down any time soon, instead asking already cash-strapped Americans to be patient with any rising costs potentially harming businesses and consumers.

“We can play the game all they want,” Trump said.

But to countries threatening the US with tariffs in response to Trump’s orders, it likely doesn’t feel like a game. According to AP News, the Ministry of Commerce in China plans to file a lawsuit with the World Trade Organization for the “wrongful practices of the US.”

Photo of Ashley Belanger

Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.

Tariffs may soon spike costs of cars, household goods, consumer tech Read More »

trump-targets-mexico-and-canada-with-tariffs,-plus-an-extra-10%-for-china

Trump targets Mexico and Canada with tariffs, plus an extra 10% for China

Trump had in particular targeted Mexico on the campaign trail, threatening to impose “whatever tariffs are required—100 percent, 200 percent, 1,000 percent” to stop Chinese cars from crossing the southern border.

He has also warned Mexico’s president, Claudia Sheinbaum, he would impose tariffs of 25 percent if she did not crack down on the “onslaught of criminals and drugs” crossing the border.

The levies could be imposed using executive powers that would override the USMCA, the free trade agreement Trump signed with Canada and Mexico during his first term as president.

“There’s a lot of integration of North American manufacturing in a lot of sectors, particularly autos, so this would be pretty disruptive for a lot of US companies and industries,” said Warren Maruyama, former general counsel at the Office of the US Trade Representative. “Tariffs are inflationary and will drive up prices,” he added.

Ricardo Monreal, leader of Mexico’s ruling party in the lower house of congress, said tariffs would “not solve the underlying issue” at the border. “Escalating trade retaliation would only hurt people’s pockets,” he wrote on X.

Diego Marroquín Bitar at the Wilson Center think tank warned that unilateral tariffs “would shatter confidence in USMCA and harm all three economies.”

In a joint statement, Canada’s deputy prime minister, Chrystia Freeland, and public safety minister Dominic LeBlanc hailed the bilateral relationship with the US as “one of the strongest and closest… particularly when it comes to trade and border security.”

They also noted that Canada “buys more from the United States than China, Japan, France, and the UK combined,” and last year supplied “60 percent of US crude oil imports.”

“Even if this is a negotiating strategy, I don’t see what Canada has to offer that Trump is not already getting,” said Carlo Dade at the Canada West Foundation.

While Trump put tariffs at the center of his economic pitch to voters, President Joe Biden has also increased levies on Chinese imports. In May, Biden’s administration sharply increased tariffs on a range of imported clean-energy technologies, including boosting tariffs on electric vehicles from China to 100 percent.

Biden’s administration has also pushed Beijing for several years to crack down on the production of ingredients for fentanyl, which it estimated claimed the lives of almost 75,000 Americans in 2023. Beijing this year agreed to impose controls on chemicals crucial to manufacturing fentanyl following meetings with senior US officials.

Additional reporting by William Sandlund and Haohsiang Ko in Hong Kong, Christine Murray in Mexico City, Ilya Gridneff in Toronto, Joe Leahy in Beijing, and Alex Rogers in Washington.

© 2024 The Financial Times Ltd. All rights reserved. Not to be redistributed, copied, or modified in any way.

Trump targets Mexico and Canada with tariffs, plus an extra 10% for China Read More »

china-tells-wto-that-us-ev-subsidies-are-unfair-trade-barriers

China tells WTO that US EV subsidies are unfair trade barriers

trade war continues —

China says it’s unfair that only EVs made in North America qualify for tax credits.

China money RMB and USA USD

Getty Images

The ongoing dispute between the United States and China over electric vehicles shows no sign of abating. Today, Reuters reports that China has asked the World Trade Organization to set up a special panel to determine if US EV subsidies are an unfair trade barrier.

The Inflation Reduction Act of 2022 has been the most significant climate legislation in US history, with hundreds of billions of dollars of funding for the clean energy transition. Among its many details, it revamped the federal tax credit for buying a new electric vehicle.

In the past, a credit of up to $7,500 was tied to a plug-in vehicle’s battery capacity. But it’s now tied to where the car and its batteries were assembled, as well as where the battery minerals come from. Final assembly of the vehicle must be in North America, for example, and ever-increasing amounts of the battery pack’s content and value must come from North America or a country with which the US has a free trade agreement.

Even more troubling for Chinese automakers is a rule from the US Treasury Department that prohibits tax subsidies for vehicles manufactured by companies linked to “foreign entities of concern,” a category that includes Russia, North Korea, Iran, and China.

The measures were included in tax credit rules after extensive lobbying from automakers and unions in the US and politicians from both sides of the aisle. Pressure from the automotive industry also succeeded in getting the Mexican government to promise not to subsidize new Chinese EV factories south of the US border.

In May, US President Joe Biden levied a new 100 percent tariff targeted at specific Chinese imports, including EVs. In Europe, similar fears over the impact of heavily subsidized Chinese EVs on domestic car production saw the EU raise new tariffs of up to 37.6 percent on Chinese-made EVs, despite objections from the German auto industry.

China’s action at the WTO actually predates the new US EV tariffs—it first went to the trade organization in March, arguing that the US tax credits hinder fair competition and break existing WTO agreements.

China’s commerce ministry told Reuters that protectionist EV subsidies from the US “undermine international cooperation on climate change.”

China tells WTO that US EV subsidies are unfair trade barriers Read More »

biden’s-new-import-rules-will-hit-e-bike-batteries-too

Biden’s new import rules will hit e-bike batteries too

tariff tussle —

The tariffs’ effects on the bike industry are still up in the air.

family on cargo e-bike

Last week, the Biden administration announced it would levy dramatic new tariffs on electric vehicles, electric vehicle batteries, and battery components imported into the United States from China. The move kicked off another round of global debate on how best to push the transportation industry toward an emissions-free future, and how global automotive manufacturers outside of China should compete with the Asian country’s well-engineered and low-cost car options.

But what is an electric vehicle exactly? China has dominated bicycle manufacturing, too; it was responsible for some 80 percent of US bicycle imports in 2021, according to one report. In cycling circles, the US’s new trade policies have raised questions about how much bicycle companies will have to pay to get Chinese-made bicycles and components into the US, and whether any new costs will get passed on to US customers.

On Wednesday, the Office of the United States Trade Representative—the US agency that creates trade policy—clarified that ebike batteries would be affected by the new policy, too.

In a written statement, Angela Perez, a spokesperson for the USTR, said that e-bike batteries imported from China on their own will be subject to new tariffs of 25 percent in 2026, up from 7.5 percent.

But it’s unclear whether imported complete e-bikes, as well as other cycling products including children’s bicycles and bicycle trailers, might be affected by new US trade policies. These products have technically been subject to 25 percent tariffs since the Trump administration. But US trade officials have consistently used exclusions to waive tariffs for many of those cycling products. The latest round of exclusions are set to expire at the end of this month.

Perez, the USTR spokesperson, said the future of tariff exclusions related to bicycles would be “addressed in the coming days.”

If the administration does not extend tariff exclusions for some Chinese-made bicycle products, “it will not help adoption” of e-bikes, says Matt Moore, the head of policy at the bicycle advocacy group PeopleForBikes. Following the announcement of additional tariffs on Chinese products earlier this month, PeopleForBikes urged its members to contact local representatives and advocate for an extension of the tariff exclusions. The group estimates tariff exclusions have saved the bike industry more than $130 million since 2018. It’s hard to pinpoint how much this has saved bicycle buyers, but in general, Moore says, companies that pay higher “landed costs”—that is, the cost of the product to get from the factory floor to an owner’s home—raise prices to cover their margins.

The tariff tussle comes as the US is in the midst of an extended electric bicycle boom. US sales of e-bikes peaked in 2022 at $903 million, up from $240 million in 2019, according to Circana’s Retail Tracking Service. Sales spiked as Americans looked for ways to get active and take advantage of the pandemic era’s empty streets. E-bike sales fell last year, but have ticked up by 4 percent since the start of 2024, according to Circana.

In the US, climate-conscious state and local governments have started to think more seriously about subsidizing electric bicycles in the way they have electric autos. States including Colorado and Hawaii give rebates to income-qualified residents. E-bike rebate programs in Denver and Connecticut were so popular among cyclists that they ran out of funding in days.

A paper published last year by researchers with the University of California, Davis, suggests these sorts of programs might work. It found that people who used local and state rebate programs to buy e-bikes reported bicycling more after their purchases. Almost 40 percent of respondents said they replaced at least one weekly car trip with their e-bike in the long-term—the kind of shift that could put a noticeable dent in carbon emissions.

This story originally appeared on wired.com

Biden’s new import rules will hit e-bike batteries too Read More »

biden-set-to-levy-100%-tariffs-on-chinese-evs-this-week

Biden set to levy 100% tariffs on Chinese EVs this week

The Chinese government does not have US consumer interests at heart —

Both the US and EU are deeply concerned about heavily subsidized Chinese OEMs.

The photo is filled with row after row of new SUVs, all painted white or grey.

Enlarge / New energy vehicles are being loaded into containers for export at Taicang Port and Taicang International Terminal in Suzhou, Jiangsu Province, China, on April 26, 2024.

Photo by Costfoto/NurPhoto via Getty Images

President Joe Biden is expected to levy new 100 percent tariffs targeted at specific Chinese industries, including electric vehicles, on Tuesday. The announcement follows growing calls from automakers, unions, and bipartisan efforts in Congress to address the problem of China unfairly subsidizing its own industries to undermine foreign competitors.

Why are Chinese EVs so cheap?

The Chinese government has been giving its green industries heavy direct subsidies for some time now, far in excess of those handed out by US or European governments. For EV makers like BYD, this has meant billions of dollars a year, in addition to the consumer-facing tax benefit for car buyers, similar to how EV sales are incentivized in the US.

Brands like BYD have concentrated on making their cars cheaper to build—only using one windshield wiper instead of two, for example—but also through vertical integration. Other than Tesla, automakers in the US, Europe, Japan, and Korea instead rely heavily on multiple tiers of suppliers, most of whom supply parts to more than one automaker.

Chinese EV makers have also embraced technology to a degree still not matched by other brands, with screens stretching across entire dashboards and online connected services (plus the associated government tracking) that are anathema to many Ars readers. (Indeed, in February, the US Department of Commerce opened an investigation into whether imported Chinese-connected cars pose a national security threat. The Chinese government has repeatedly restricted the places that Tesla drivers are allowed take their cars, as it considers them a threat to its own security.)

That has allowed Chinese automakers to sell their products in foreign markets at prices no one else can hope to compete with, undermining local industries in the process. This has been most relevant in Europe, where Chinese automakers like BYD and MG have already set up shop. Last year, 1 in 5 EVs sold in Europe were made in China; this year, it’s expected this number will rise to 1 in 4.

What’s everyone doing about it?

Last year, the European Union began an investigation into anticompetitive behavior by Chinese OEMs, and stronger EU tariffs on Chinese EVs are expected to be levied in the next few weeks.

Chinese car imports to the US are already subject to an additional 25 percent import tariff on top of the 2.5 percent tariff that applies to any car imported to the US. And Chinese brands have yet to enter the US market. If enacted this week, the new 102.5 percent tariffs would apply to Polestar and Lotus, both of which currently build their US-market EVs in China. But that doesn’t mean the industry isn’t terrified.

“If there are no trade barriers established, they will pretty much demolish most other car companies in the world,” said Tesla CEO Elon Musk in January.

“If you cannot compete fair and square with the Chinese around the world, then 20 percent to 30 percent of your revenue is at risk,” said Ford CEO Jim Farley in February.

It probably goes without saying that the United Auto Workers also thinks protecting the US auto industry is worthwhile. “The transition to cleaner technologies cannot be used to intensify the global race to the bottom through offshoring and low wages. We need to see movement by the administration to protect these jobs. The nascent EV industry needs tariff protections—otherwise we are going to be awash in imports. The stakes of the transition are high for American workers,” the union said in a statement in March.

US politicians have already passed laws to counter the threat of China dumping EVs here. The Inflation Reduction Act of 2022 revised how the IRS clean vehicle tax credit works; the consumer subsidy is now only eligible on vehicles assembled in North America. Each year, an increasing amount of the battery pack’s content and value must also have originated in the US or a country with which we have a free trade agreement in order to be eligible, and EVs with Chinese batteries are explicitly not eligible.

This year, senators on both sides of the aisle—most recently Sherrod Brown (D–Ohio)—have called for a ban on Chinese EV imports. And pressure from the US Trade Representative has seen the Mexican government promise not to offer incentives to Chinese EV makers looking to establish a beachhead inside the United States-Mexico-Canada Free Trade Agreement.

Biden set to levy 100% tariffs on Chinese EVs this week Read More »