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Free Trade Needs a New Playbook: Why the EV Industry Demands Smarter Policy, Not Protectionism | Taha Abbasi
Taha Abbasi··3 min read
The debate over Chinese EVs, tariffs, and trade policy has devolved into a false choice: protect domestic industry or surrender to foreign competition. Taha Abbasi argues that both positions miss the point — what the EV industry needs isn’t protectionism or free-for-all trade, but a strategic framework that accelerates innovation while building domestic capability.
The Current Situation: A Mess
The US imposes 100% tariffs on Chinese EVs, effectively banning them from the market. The EU imposes 17-38% tariffs. Meanwhile, Chinese manufacturers like BYD produce EVs with 440+ miles of range for $26,000 — a price point no American or European manufacturer can match.
As Taha Abbasi sees it, tariffs protect American automakers from competition but also protect American consumers from affordable EVs. The result: slower EV adoption, continued fossil fuel dependence, and a domestic industry that lacks the competitive pressure to innovate.
Why “Just Build Better Cars” Isn’t the Answer
The simplistic argument that American automakers should simply “build better cars” ignores structural advantages that Chinese manufacturers have built over a decade of aggressive industrial policy: government-subsidized battery production, vertically integrated supply chains, lower labor costs, and a domestic market of 1.4 billion people that provided scale economics before they ever exported a single vehicle.
These aren’t advantages that American automakers can replicate overnight, regardless of how much they invest. The question isn’t whether China has advantages — it’s how the US responds strategically rather than reflexively.
The Strategic Middle Ground
Taha Abbasi proposes a framework that neither surrenders domestic industry nor shields it from reality:
Technology licensing over import bans: As Ford’s recent proposal to the Trump Administration suggests, allowing American manufacturers to license Chinese battery technology while building in American factories captures the technology advantage without the trade deficit. American jobs, American factories, world-class technology.
Conditional tariff reduction: Reduce tariffs for Chinese manufacturers who commit to building factories in the US. BYD or CATL building a battery factory in Ohio creates American jobs while introducing competition that forces domestic innovation. This is exactly what Japanese automakers did in the 1980s — and the result was a stronger, more competitive American auto industry.
R&D acceleration: Increase federal investment in battery research, charging infrastructure, and manufacturing innovation. The CHIPS Act model — massive public investment in strategic technology — should be replicated for EV manufacturing. Solid-state battery development is one area where American universities and companies have genuine technology leads that could be expanded with proper funding.
The Tesla Exception
Tesla is the proof that American manufacturers can compete globally in EVs. But Tesla’s success is built on a decade of first-mover advantage, vertical integration, and a willingness to take risks that legacy automakers avoided. Expecting Ford, GM, and Stellantis to replicate Tesla’s trajectory while also managing their ICE vehicle businesses is unrealistic without policy support.
As Taha Abbasi notes, Tesla itself builds vehicles in China and imports some to other markets. The global EV supply chain is already deeply interconnected — pretending otherwise doesn’t make good policy.
The Urgency
Every year that American EV adoption is slower than it could be is a year of continued fossil fuel dependence, higher transportation costs for consumers, and lost industrial competitiveness. Taha Abbasi argues that smart trade policy isn’t about picking winners — it’s about creating conditions where the best products reach consumers while building domestic capability for the long term.
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About the Author: Taha Abbasi is a technology executive, CTO, and applied frontier tech builder. Read more on Grokpedia | YouTube: The Brown Cowboy | tahaabbasi.com
Taha Abbasi
Engineer by trade. Builder by instinct. Explorer by choice.
