China can afford short term to massively subsidize their auto industry if this means it will completely wreck the local industries in Europe and US. Because once an industry is wrecked, it's very expensive to unwreck it.
Instead of fighting back and trying to make ground, the EU makes sure that their own companies loose China as a market.
This isn't about VW selling German cars in China. This is about every major car maker having set up large JVs. The distinction between Chinese and EU companies is increasingly blurred.
The EU cannot make the rules in China or regulate their market and China rarely plays by any rules anyway, even the ones they ostensibly set. In other words, China has broken trust on every possible occasion so any "ground making" today is worthless tomorrow. How many times would you invest in the hopes of "this time it will work" with a partner who keeps pulling the rug from underneath you every time?
Plainly false. It can do what is doing now, ruining it's local economy or it can fight to make sure EU companies can function from a position of strength.
>How many times would you invest in the hopes of "this time it will work" with a partner who keeps pulling the rug from underneath you every time?
EU car makers are very successful in China. Every German car maker opposes the Tarifs for that reason.
> I don't think you understand how the Chinese car market works at all [...] This is about every major car maker having set up large JVs. The distinction between Chinese and EU companies is increasingly blurred
Both of these quotes are yours. In a feat of extreme cognitive dissonance you can't seem to make up your mind about how that market works. So this and the large volume of your misinformed comments sure starts to sound like trolling to me.
There's no "EU manufacturer" in China, there are EU brands and tech, and Chinese-EU JVs. As I said before China has broken trust with every opportunity and even has an internal legal framework to support that. What local EU/US car manufacturers are doing is chasing short term profit because the executives and shareholders want to get it in their lifetimes. Après moi, le déluge.
But EU/US interests are far longer term than the average company CEO's term. So "let's make a quick buck for the next decade or two and then realize we're outcompeted to an inconceivable degree" is not an option for anyone who's not looking to completely sabotage their internal economy.
The correct counter-strategy is that all major economies - USA, EU, India, etc. - enact tariffs.
Make better products, make products faster, make products more efficiently.
>The correct counter-strategy is that all major economies - USA, EU, India, etc. - enact tariffs.
This just means giving up. And admitting that you can't compete.
So what exactly would you do to make a European manufacturer competitive with Chinese one, that essentially uses slave labor?
Let's say you tell them - cut your costs by 30% or die. They can't do that and they die. What now?
Maybe, but only competition forces you into innovation. Companies very much like to do things they are already doing, that is easy.