I was watching this video and thought I would share with SN econ
Does SN think the China EV market is a classic case of gov distorting the market, or a genius move to flood the world with cheap cars and eventually become profitable?
Would you buy one? To be honest, if someone offered me a new one for a cheap price, I would be tempted, I'd have safety concerns though and some of the comments from mechanics working on them reinforce this fear.
But if the EU is going to try and ram one down my neck, I'm not going to be paying silly money for one. I don't want or need an expensive car, wasted money and debt that could be spent on stacking instead.
Anyway, here's a gpt summary of the video
🔥 Safety Concerns Are Mounting
Chinese EVs are increasingly under scrutiny for serious safety failures:
Spontaneous fires are becoming alarmingly common.
Self-driving mishaps have led to deadly accidents.
Airbags are failing to deploy, even in major crashes.
These aren't isolated incidents—they're systemic failures.
🏠The Car Fields of China
Across China, fields full of unused "sold" EVs sit idle. These zero-mileage cars—many with plates and insurance—are never driven. Why? Because they were never actually sold to real customers.
Manufacturers register these cars to themselves, claim they’ve been sold, and collect government subsidies. The vehicles are then parked, sometimes for years, until they’re quietly offloaded as “used” at a discount. These are often sold domestically or dumped in poorer countries, regardless of safety.
đź’¸ Fake Sales, Real Money
The scam works like this:
A company manufactures EVs.
Instead of selling them to customers, they register the cars to themselves.
This triggers government subsidy payouts.
Companies use these inflated “sales” to attract more investment.
The cars sit unused until they are quietly pushed into the secondhand market.
It’s a cycle: subsidies fuel fake sales → fake sales boost investor confidence → investors provide more money → more cars are built.
Even executives from within the industry, like the CEO of Great Wall Motors, have spoken out, comparing this to the Evergrande real estate collapse.
🧪 Quality Control:
Because many of these cars were never meant to be used by real customers, manufacturers cut corners:
Cheap materials and fake parts
Lax safety checks
Outdated or faulty software
These cars aren’t built to last. They're built to sit in a field long enough to qualify for subsidies, then dumped as someone else’s problem.
🌍 Global Consequences
This scheme isn’t just a Chinese problem. As these cheap EVs flood global markets:
Local industries face unfair competition from subsidized junk.
Consumers in poorer countries face safety hazards.
Environmental costs skyrocket from producing thousands of unused cars.
Making one EV takes an enormous toll on global resources—from rare earth mining to water usage. Building millions of cars destined to rot is the opposite of sustainable.