Chinese Cars Have Arrived in Small Numbers

The Wall street Journal reports The U.S. Wants to Ban China's High-Tech Cars, but They're Already Here in El Paso

Just 5 miles from the U.S. border, a bustling commercial strip here offers the buzzy Chinese car brands currently blocked from the American market.

A Geely dealership features the all-electric EX2, a sleek compact that starts at only around $20,000. A bulky hybrid pickup truck sits next to a charger outside a BYD dealership. Great Wall Motors boasts some beefy gas-powered sport-utility vehicles, one advertised with the slogan "Be More Tank."

Luis Hernandez, a Geely salesman, said he has poached many longtime Ford and Chevrolet owners attracted to the affordable sticker prices and whiz-bang Chinese technology. He recently sold two Geely Emgrand sedans, which start at around $17,000, to a Mexican family for their two daughters to commute to college in El Paso, where the sleekest Chinese cars are now attracting attention.

"If they were allowed to be sold in the United States," Hernandez boasted of the Chinese models, "they would destroy the American car market."

"I'm telling you, it is very difficult—not to say impossible—to compete," said Hyundai Motor Chief Executive José Muñoz. "We cannot compete at the same price as the Chinese in the market where we operate. Otherwise, we will be losing money."

So far, the many Chinese car companies that want to expand into the U.S. have been kept at bay. The U.S. has applied sky-high tariffs to vehicles imported from China, and regulations make it nearly impossible for such vehicles purchased in Mexico to be registered in the U.S. A trio of senators has urged the Trump administration this month to ban Chinese vehicles sold and registered in Mexico and Canada from entering the country; several dozen House lawmakers sent a similar letter this week. A Senate bill to prohibit China's carmakers from building cars in the U.S. is being crafted.

BYD, Geely and Great Wall Motors are now among the biggest carmakers in the world. They have been gobbling up market share in Europe and other parts of Asia. In Mexico, Chinese vehicles account for a quarter of total sales. Soon, Canada will allow tens of thousands of inexpensive Chinese EVs to be imported.

Sen. Bernie Moreno (R., Ohio) said the bill he plans to introduce would "hermetically seal" the U.S. from Chinese automakers. Chinese cars from Canada or Mexico couldn't be driven into the country. American car companies couldn't pursue joint-ventures with Chinese automakers. Chinese car companies that own U.S. brands, such as Geely-controlled Volvo and Polestar, would have to divest themselves of those brands by 2030.

At Geely's dealership, Hernandez, the salesman, said the store's top seller is the entry-level, gas-powered Emgrand, which would compete in America against compact cars such as the Nissan Sentra or Hyundai Elantra.