Here's a corollary to this morning's post about export hurdles. Not only will electric vehicles (EVs) and related components face logistical problems moving from the U.S. to overseas markets, there are a host of other reasons why it just makes sense for companies to build EV battery packs in America for Americans. Times are changing and the once great economic advantage of manufacturing in China over the U.S. is shrinking. Here's why:
- We all know that most of what we buy carries the "Made in China" tag because it's cheap to get stuff made there thanks, in part, to low labor costs. However, Chinese workers demanding better pay and labor costs for a fully assembled automotive battery pack only account for a small portion of the overall cost.
- Chinese currency is appreciating, so the mighty dollar will buy us less.
- Fuel prices are on the rise. Shipping very heavy battery packs on expensive fuel can eat up the savings garnered from cheap labor.
[Source: New York Times]