Why Detroit's Auto Industry Should Expedite Exit from China: A Compelling Case

Money | June 19, 2024, 2:53 p.m.

The article discusses the history of American and German automakers using China as a profit center and the current challenges they face in the Chinese market. With increasing competition, overproduction, price wars, and protectionism, the question arises: should the Detroit Three automakers leave China? Analysts suggest that focusing on profitable vehicles and new powertrains may be the solution. However, the high cost of components compared to Tesla poses a challenge. In addition, the article covers Ferrari's expensive EV plans, dropping wholesale used car prices, and a dealership's innovative approach to attracting new technician talent. Ultimately, the argument is presented for automakers to reconsider their strategies in China and focus on maximizing profits to invest in future technologies like EVs. The author closes with a reflection on the timeless relevance and significance of Sam Cooke's iconic song, "A Change Is Gonna Come."