BYD Bets on Budget EV Boom with Atto 1 Debut in Indonesia

Yes, but companies run for investors will always have to pay investors, so it would have either been a buyback or dividends. When interest rates go up, companies end up competing with government bonds, and they must give dividends that keep them competitive, and in 2023 that was something like 4.3%.

For investing in the future to be possible interest rates must essentially be low.

I've thought a little about this problem, because recently we had situations where we simultaneously had inflation and needed investments to produce products in new ways to counter that inflation, and this obviously leads to a situation where it's difficult to get out of the problem. If we increase the interest rates then we stop the inflation, but the interest rates will be too high for investments to counter them. Concretely: Northvolt was trying to do American-style doomscaling and then interest rates went up, so they went under.

I believe that there is a solution: giving the central banks the additional tool to set a mandatory savings fraction of wages-- that is, that the central banks are allowed to set a fraction of wages that must be saved, and which may be invested or used to start a company but which isn't allowed to be used for consumption.

If you then have inflation and consumers are bidding over each other for goods and driving up the prices the central bank can increase the savings fraction without changing the interest rate. So plausible, in case of inflation you'd look at the need for capital to get out of it: if there's no need for capital to build new things and get out of it, then you just increase the interest rate, if there is, you increase the mandatory savings rate.

I thought about voluntary solutions, but suppose that we consider a savings pacts-- i.e. ordinary people get together and agree to all save a certain fraction of their income, then this drives down prices, so whoever deviates from the pact gets so much goods that he's really happy with what he gets for his money. Consequently such savings pacts are unstable and the savings pact must be mandatory.

I also think this is especially right for Europe. I calculated that if the central banks set this at 5% then this is enough for Draghi's €800B of needed investment, but it's obviously also applicable to the US if the US wants to transition to EVs, and now you have even higher interest rates than we do, so this policy might actually be the right thing for you too.

Thank you for providing another example for me to use when arguing against stock buybacks[0], it's an absurdity of perverse incentives.

[0] https://news.ycombinator.com/item?id=44590826

Sure because having domestic industry is a strategic decision. Also the reason why Soviet carmakers won't go bust. American competition simply won't be allowed. Easy as that, comrade!

>Chinese competition simply won't be allowed. Easy as that.

Then the domestic industry will just rot from inside. It is usually a worse outcome than if the domestic industry were competing in the open market.

Tariffs and other protectionist measures result in the low quality high priced product of the protected industry being sellable only in the domestic market. Where is China is going to sell to the rest of the world. 340M vs. almost 8B of addressable market. It is a writing on the wall.

Protectionism does not work. Your plan was already tried with naval traffic, look at the effects of the jones act.

For that you have to read Chricton's other book Jurassic Park.

There the message is simple - chimps with 3 inch brains love to pretend they can control ever increasing complex systems and scale. And obviously they can't.

China's enemy is Complexity. Not the US which is too lost to talk about. Complexity goes on increasing and pressure to pretend they have control also increases. Mistakes will be made and multiply with time. So see Covid, Evergrande/Country Garden, techbro crackdown, young ppl checking out etc. Larger the system more the issues not less. More fragile. Not less.

Even though there is some overlap of the European continent and Russia's territory, I don't think that Russia qualifies as an example for the average European country.

Also, why are you mentioning the look of people in a discussion about cars and manufacturing?

> doesn’t that sound massively stupid to you?

Also tangential? Economic development and demographic patterns might be more relevant than jumping straight to race like you did.

Tesla seems to be doing pretty OK on the manufacturing side. These days quality of the physical product is decent enough and the price of their different models are highly competitive in their respective segments.

The flaws in Teslas cars are mostly design choices (plastic seats instead of cloth/leather, bad ergonomics due to focus on minimalist aesthetic, uncomfortable suspension setup etc, etc). Some of it is following trends, some of it is Elons stupid ideas.

Financially it seems like Teslas big problem is the AI-investments. Burning unfathomable amounts of cash on useless software, instead of putting that money towards developing their model lineup and improving quality on things that matter.

Equinox is selling very well.

This is the point that The Economist made this week about Xiaomi. It looks like Lei Jun, the CEO, has a bit of a cult following in China.

"With the successful release of the YU7—its second electric vehicle (EV) after the SU7, a sporty sedan launched in March last year—Xiaomi has pulled off a feat that eluded Apple, which ditched plans to make its own EV after burning billions of dollars on the effort over a decade."

There's also a brutal price war going on over there. Those cars will be exported worldwide. Western countries are in a bind: protect the local manufacturer or allow the (much) cheaper and environmentally sound EV in from China?

"China’s smartphone champion has triumphed where Apple failed" [1]

https://archive.is/4o8hM

> According to Wikipedia, the Xiaomi SU7 Max has 1,784 hp and is priced at 73,000 USD. In some YouTube videos, they raced against Ferraris and Bugattis, and it fared better than much more expensive cars. I have no idea how they did it.

A Cybertruck may look clumsy, but it can been a Lamborghini. Instant torque.

The highest horsepower in a Ferrari road car is 1,200 in the F80. Though, I’m pretty confident you got the HP wrong for the Xiaomi.

Tesla is still competing reasonably well with BYD in China.

> No this administration is set on protecting industry

No, this administration ostensibly wants to Make America Great Again, but that requires policy that is focused on the greater good -- with a long term vision on the investment.

The reality is that they are actually interested in is actually a kakistocracy and has the following concerns: self-enrichment, staying in power, and oppressing its enemies.

The fit is an awesome car! My friend owns one and the way the rear seats fold into the floor is a sight to behold. Immensely practical vehicle.

> US-bound Fits were made in the same Mexico factory that made the more profitable Honda HR-V

> The HR-V was successful enough that it displaced some Fit production

> it’s that they found they could use their manufacturing capacity to sell more expensive, more profitable models to Americans instead.

That by definition implies that the Fit did not have ideal PMF. You do NOT want to be managing multiple SKUs, especially if they are cannibalizing each others market.

It's also an additional point showing that if given the option or the ability, consumers would spend a couple thousand more just to get a CUV instead if a hatchback.

Edit: I forgot, no one on HN understands how basic business works. Keep the downvotes coming

That jibes with my personal experience. Honda made the Fit too good to replace (best car I've ever owned) and then they ditched the model before we needed a new one.

True. Nobody buys a new hatchback - the kind of practical person who wants a hatchback wouldn't dream of taking the new vehicle depreciation hit. You get one with a Facebook marketplace discount.

If that were the case, then US manufacturers would be doing far better with EVs than they are. Yet they are not able to keep up with BYD and are failing at hitting their own milestones.

So you are saying that they adapt to the local market but are perfectly capable of selling perfectly good vehicles abroad when they want to? This doesn't match what I know of the market. It also doesn't make much sense. Basically most of the BYD market is China but it's a hyper competitive market where there's a price war going on. I'd say there's very little room for chronic under performers in that market. As there are literally dozens of companies eager to step up and do better. From what I've seen if you want to get a glimpse of the future of road transport, you need to go to China.

That's not my experience, I was in China, drove the cars and also tried them in the EU.

> that is pretty great they can produce these cars for $12k

All new hatchback EVs comparable to the Atto in Asia can be purchased at around $8-12K as I mentioned before, like the Tata Tiago EV, Tata Punch EV, and VinFast VF3.

> Regardless of the potentially unsound money involved

It becomes unsound when you are selling it at $7-8K, which is what has been happening in China.

Hypothetically great for consumers, but in action it was a net negative because the SOEs competing against BYD are all owned by provinces, so it was citizens money getting burned.

This itself is why Chinese leadership has reprimanded the entire EV industry a couple days ago for reckless price wars [0]

[0] - https://www.gov.cn/zhengce/202507/content_7032374.htm

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