The Rising Influence of Rising Affluence

[Latoria]

The potential for an EV trade war is indeed a concerning prospect, especially given the significant strides made by Chinese companies like BYD in the electric vehicle market. While Tesla has been a dominant player, the emergence of competitors like BYD poses a serious challenge, particularly if trade tariffs come into play.

The question of who is better positioned, the EU/USA or China, is complex and multifaceted. China has certainly invested heavily in building its battery and supply chain networks, giving it a competitive advantage in the EV industry. Meanwhile, the EU and USA have been slower to develop a domestic battery supply chain, potentially leaving them at a disadvantage.

Trade tariffs could further complicate the situation, potentially hindering the development of a domestic battery supply chain and forcing companies like BYD to seek markets elsewhere. This could isolate and marginalize the domestic EV industry in Europe and the USA.

As for Tesla and other car makers in the EU and USA, the threat of retaliatory tariffs from China looms large. Any escalation in trade tensions could have significant implications for these companies, potentially impacting their access to crucial markets and resources.