100% import tariff on Chinese-made cars in USA

[Nick in Sydney]

I see that Volvo has announced a delay in launching their EX30 in the USA while they shift production from China to Europe to avoid the new 100% tariff on Chinese-made cars.

For those who haven't followed the story, in May the US government announced that the import tariff on Chinese-made cars will quadruple later this year, going from 25% to 100%.

You have to wonder if Lotus Technology still has a viable product range at this tariff level. It will be incredibly hard for them to sell Eletre and Emeya in the USA at a competitive price point and still make any money.

 

[Time2Fly]

Without charger support in the US it's barely viable anyway.

 

[dgrace]

I had thought that no car launch could go worse than the Emira, but the Eletre may be in the "hold my beer" phase.

 

[freefall_junkie]

The EU is also about to introduce tarrifs of over 30% https://www.autocar.co.uk/car-news/...mport-tariff-car-makers-move-production-china . The UK is apparently likely to follow the EU's lead. How on earth does Lotus survive all this?

 

[Time2Fly]

I'd be surprised to see the UK put a bullet in Lotus.

 

[Eagle7]

The EU is also about to introduce tarrifs of over 30% https://www.autocar.co.uk/car-news/...mport-tariff-car-makers-move-production-china . The UK is apparently likely to follow the EU's lead. How on earth does Lotus survive all this?

They survive by being a leader, not a follower. Use the Wuhan factory to make cars for China and the Asian market. Use the Hethel location to make cars for Europe and North America. Go hybrid at Hethel. If they want to stay EV at Wuhan, that's up to them. China controls the majority of the rare earth mineral resources of the world, so making EV's at Wuhan would be more viable for them for that market. The all-EV mandates for Europe and North America are going to fall apart, and be modified to focus on fuel economy instead of just electric. Those winds are already starting to blow.

Lotus Hethel should focus on hybrid development, and Carr's design team should do the design work. Don't focus on competing with anybody; focus on making great products and providing great interaction and support for the customer. Use the Emira as the lesson/example. Design a beautiful sports sedan that ISN'T super powerful, but looks like it and price it between $50k-$75k. Follow up with a hybrid SUV that again, isn't super powerful, but IS super cool and useful as an SUV. Make the focus on the function like they did with the Emira, and keep the SUV affordable like the sports sedan.

Put some serious effort into the customer experience, starting with online interaction. Set up a network of satellite offices that are a dealer location insofar as service and visibility, but they do NOT carry vehicle inventory. They have demos customers can see and drive, and the location can assist in ordering, but mostly they are service and customer interaction locations. This would greatly reduce the weight of the cost of maintaining each location, as it doesn't sit under the pressure of the cost of inventory sitting on the lot, hoping somebody wants to buy one of them. That old business model is no longer viable because cars cost too much to produce and buy now.

This business model would allow Hethel to expand its production capability as needed, with most likely another facility for the SUV, and let the current facility produce the sports cars and sports sedan. Let the satellite locations handle the customer interaction/experience so the factory can just focus on making vehicles, which is what they seem to want to do anyways.

Looks is what's going to get attention; that's the lesson of the Emira. Next is a price that's way below what the looks would suggest. That's the other lesson of the Emira. A hybrid powertrain/platform could be developed that's the same for all 3; sports car, sports sedan and SUV. That would help keep the costs down for production and sales. Put the main focus for the sedan and SUV, on what people use sedans and SUV's for. It isn't 0-60 and track times. Let the sports car be the performance model, which would be the most expensive of the line-up.

Lotus CAN survive and prosper if they stop worrying about what other companies are doing, and focus on making the products that they themselves would want to buy and use.

 

[Nick in Sydney]

I'd be surprised to see the UK put a bullet in Lotus.

Lotus Cars in Hethel, yes, but they wouldn't care much about Lotus Technology, a Chinese headquartered company listed on a US stock exchange.

Remember, Lotus Technology doesn't even own Lotus Cars yet. They just have an option to acquire it and the exclusive rights to sell its vehicles outside the UK.

 

[ADC]

They survive by being a leader, not a follower. Use the Wuhan factory to make cars for China and the Asian market. Use the Hethel location to make cars for Europe and North America. Go hybrid at Hethel. If they want to stay EV at Wuhan, that's up to them. China controls the majority of the rare earth mineral resources of the world, so making EV's at Wuhan would be more viable for them for that market. The all-EV mandates for Europe and North America are going to fall apart, and be modified to focus on fuel economy instead of just electric. Those winds are already starting to blow.

Lotus Hethel should focus on hybrid development, and Carr's design team should do the design work. Don't focus on competing with anybody; focus on making great products and providing great interaction and support for the customer. Use the Emira as the lesson/example. Design a beautiful sports sedan that ISN'T super powerful, but looks like it and price it between $50k-$75.k. Follow up with a hybrid SUV that again, isn't super powerful, but IS super cool and useful as an SUV. Make the focus on the function like they did with the Emira, and keep the SUV affordable like the sports sedan.

Put some serious effort into the customer experience, starting with online interaction. Set up a network of satellite offices that are a dealer location insofar as service and visibility, but they do NOT carry vehicle inventory. They have demos customers can see and drive, and the location can assist in ordering, but mostly they are service and customer interaction locations. This would greatly reduce the weight of the cost of maintaining each location, as it doesn't sit under the pressure of the cost of inventory sitting on the lot, hoping somebody wants to buy one of them. That old business model is no longer viable because cars cost too much to produce and buy now.

This business model would allow Hethel to expand its production capability as needed, with most likely another facility for the SUV, and let the current facility produce the sports cars and sports sedan. Let the satellite locations handle the customer interaction/experience so the factory can just focus on making vehicles, which is what they seem to want to do anyways.

Looks is what's going to get attention; that's the lesson of the Emira. Next is a price that's way below what the looks would suggest. That's the other lesson of the Emira. A hybrid powertrain/platform could be developed that's the same for all 3; sports car, sports sedan and SUV. That would help keep the costs down for production and sales. Put the main focus for the sedan and SUV, on what people use sedans and SUV's for. It isn't 0-60 and track times. Let the sports car be the performance model, which would be the most expensive of the line-up.

Lotus CAN survive and prosper if they stop worrying about what other companies are doing, and focus on making the products that they themselves would want to buy and use.

This view seems too balanced and sensible, with not enough inflammatory dog-whistling... I can't see it catching on

 

[robrmon]

I think the Eletre will be a very rare car in the US, could make me reconsider getting one (where before I decided it wasn’t for me)

 

[Lotustoronto]

Lotus / Chinese EV's can survive the EU tariff rate. Lotus is imposed at 20% - This will impact the bottom line but not put them out of business. So for Europe and UK, Lotus EV's will be going full steam ahead with there plans. I also believe (based on the Tarrif situation) when Hethel starts producing the new EV sports car, which won't have a tariff, it will further reduce it's tariff amount in EU for the Chinese EV's.

The issue we have in North America is the 100% tariff. - Sorry but I can't see Lotus changing course on powertrains just for us. EU and Asia are very large markets. It makes more sense to continue with EV and leave North American market until they build a new plant outside of China.

While I agree that BEV's is not the sole solution to getting rid if gas powered vehicles (Hydrogen, Hybrid etc.) it will be the main source of vehicles going forward in the EU/Asia. That is just a fact. Which is not exactly small markets. Lotus will be just fine outside of North America. There are plenty of successful car brands that have never sold a car in the US/CAN.

The only thing that saves Lotus in N/A is a production plant outside of china. Personally, I think Lotus going full EV was a good choice for the brand. They were never going to compete with ICE models against DBX, Urus, Purosangue, Cayenne, Macan, SQ8 etc.- The Eletre for a high performance EV looks the part and can platform share with Geely's best EV tech. We have to be honest with ourselves, the Chinese are ahead of everyone when it comes it EV's and their platforms. At least at the moment.

Once Solid state battery's arrive to market, probably in 2028-2030 it will completely change the EV landscape. Imagine 800 Miles of range per charge, 10-20 mins to an 80% charge and 1/2 the weight of current batter standards. It will be revolutionary.

Press corner

Highlights, press releases and speeches

ec.europa.eu

 

[Nova]

Gentle reminder that Lotus was already planning on producing EVs in Hethel.

 

[Porter]

Lotus Hethel should focus on hybrid development, and Carr's design team should do the design work. Don't focus on competing with anybody; focus on making great products and providing great interaction and support for the customer. Use the Emira as the lesson/example. Design a beautiful sports sedan that ISN'T super powerful, but looks like it and price it between $50k-$75.k. Follow up with a hybrid SUV that again, isn't super powerful, but IS super cool and useful as an SUV. Make the focus on the function like they did with the Emira, and keep the SUV affordable like the sports sedan.

Unfortunately, Geely already owns a company that's making that product, it's called Polestar. The only way I see this working out the way you've described is if Lotus and Polestar either merged or went to full co-engineered platform sharing.

I personally don't understand why they tried to go upmarket with Lotus in the first place, it makes more sense to me to keep them affordable, engineering-led and sports/handling focused.

A more sports-styled version of the Polestar 2 with Lotus-tuned handling would have been a much more compelling volume product than the Emeya.

 

[Lotustoronto]

Unfortunately, Geely already owns a company that's making that product, it's called Polestar. The only way I see this working out the way you've described is if Lotus and Polestar either merged or went to full co-engineered platform sharing.

I personally don't understand why they tried to go upmarket with Lotus in the first place, it makes more sense to me to keep them affordable, engineering-led and sports/handling focused.

A more sports-styled version of the Polestar 2 with Lotus-tuned handling would have been a much more compelling volume product than the Emeya.

I do understand the move to go upmarket. (not Ferrari levels - but let's be honest, no brand is at Ferrari Level's. They are the Rolex of the car world.)

If Geely is looking for a product to compete against Porsche (which it said it was) you need something that has both history and racing pedigree of some sort. I don't know of another brand that was better positioned than Lotus to be acquired and developed further. They have James Bond cars (and other movie's), F1 pedigree, automotive renowned founder in Colin Chapman and some of the most famous names in auto racing drove Lotus cars. It was failing and a perfect pick to go against Porsche in the EV world.

What failing brand has that much to offer and was for sale? It was a solid idea / plan, terribly executed and a lot more bumps along the road due to tariffs.

When the Macan EV was launched, no one bemoaned about its weight or that it does not reflect the ethos of the air cooled 911 era. Nor will anyone complain about the 718's going all EV next year and probably praise them.

 

[Porter]

I do understand the move to go upmarket. (not Ferrari levels - but let's be honest, no brand is at Ferrari Level's. They are the Rolex of the car world.)

If Geely is looking for a product to compete against Porsche (which it said it was) you need something that has both history and racing pedigree of some sort. I don't know of another brand that was better positioned than Lotus to be acquired and developed further. They have James Bond cars (and other movie's), F1 pedigree, automotive renowned founder in Colin Chapman and some of the most famous names in auto racing drove Lotus cars. It was failing and a perfect pick to go against Porsche in the EV world.

What failing brand has that much to offer and was for sale? It was a solid idea / plan, terribly executed and a lot more bumps along the road due to tariffs.

When the Macan EV was launched, no one bemoaned about its weight or that it does not reflect the ethos of the air cooled 911 era. Nor will anyone complain about the 718's going all EV next year and probably praise them.

Right, but to actually "go up against" Porsche would have required a multi-billion dollar up front investment, not a 200 or 300 million dollar "me too" play. And not just for engineering the cars, they'd need to build out a global supply chain and multi-region manufacturing as a baseline condition of doing business. They haven't done that at all.

 

[Vintage]

I had thought that no car launch could go worse than the Emira, but the Eletre may be in the "hold my beer" phase.

Ford Bronco was a terrible launch. My FE was a year and a half late. Everyone blamed Covid.

 

[Porter]

When the Macan EV was launched, no one bemoaned about its weight or that it does not reflect the ethos of the air cooled 911 era. Nor will anyone complain about the 718's going all EV next year and probably praise them.

We must be talking to different people.

 

[Lotustoronto]

@Porter - I never said Lotus / Geely did a good job with competing against Porsche, you are right that they are far off the mark.... I was only implying that the Lotus brand was well positioned to compete. In fairness, Hethel got 100M for Emira development / factory, but the Lotus Tech (EV) was around 2 Billion pounds in investment. I believe the Factory in wuhan was 900M alone. - As for the auto journalists, they always praise Porsche. All I mean was, if Harry drove an EV Macan and didn't like it, he wouldn't go and sell his classic 911. Porsche has done an excellent job with its sports cars for so long that even if they develop EV's, people will give them a pass that Lotus does not receive. I guess Porsche has earned that respect by delivering top product for decades.

Lotus Goes Electric And Global, All Funded By China’s Geely

By going electric, Lotus Cars can not only level the playing field with longtime European competitors, but leapfrog into undiscovered country, an alternative electric future, becoming a benchmark rather than well-loved niche player. Here, a conversation with Lotus Managing director, Matt Windle.

www.forbes.com

 

[Foxy87]

Nor will anyone complain about the 718's going all EV next year and probably praise them.

What? Almost every one on the forums complain about 718 going all EV!

 

[Lotustoronto]

What? Almost every one on the forums complain about 718 going all EV!

I was referring to auto journalists once they test any Porsche EV.

Yes, us enthusiasts would not be overly excited for any EV sports car. Too heavy.

Was just trying to say that there is bias in auto news against anything Chinese EV at the moment - unfortunate for Lotus. If they were building all the EV’s in the UK I get the feeling it would have a different sentiment behind it. I think Eletre is a good EV SUV, especially for the bargains Lotus is handing out in the UK.

 

[Porter]

I was referring to auto journalists once they test any Porsche EV.

That's because most of them are paid hacks.

Lots of quiet about the Taycan after the initial glowing reviews, remember?