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Asia automakers still back US, tariffs or not

Tesla rolls into India with costly Model Y due to high tariffs MUMBAI: Tesla yesterday launched its Model Y at about US$70,000 (RM298,000) in India, the highest price among major markets, as the US automaker grappling with slowing sales bets on prospects in a country CEO Elon Musk has long criticised for its high import tariffs. With deliveries estimated to start from the third quarter, Tesla is targeting a niche electric vehicle segment in India that accounts for just 4% of overall sales in the world’s third largest car market. It will compete mainly with German luxury giants such as BMW and Mercedes-Benz rather than domestic mass-market EV players such as Tata Motors and Mahindra. Tesla opened its first showroom in Mumbai yesterday and began taking Model Y orders on its website, marking its long-awaited entry into the market where Musk once had plans to open a factory. For now, Tesla will import cars into a country where tariffs and related duties can exceed 100%, driving up the price for consumers. Grappling with excess capacity in global factories and declining sales, Tesla has adopted a strategy of selling imported vehicles in India, despite the duties and levies. The US EV maker has long lobbied India for lower import tariffs on cars, and Prime Minister Narendra Modi’s officials remain in discussions with US President Donald Trump’s administration to lower the levies under a bilateral trade deal. But the cars Tesla displayed in Mumbai were made in China, and its US factories do not currently make the right-hand drive vehicles that are used in India. Tesla’s Model Y rear-wheel drive is priced at about 6 million rupees (US$70,000), while its Model Y long range rear-wheel drive costs 6.8 million rupees. That compares with a starting price from US$44,990 in the US, 263,500 yuan (RM155,992) in China, and €45,970 (RM228,250) in Germany. The firm’s Full Self-Driving capability is on offer at an additional cost of 600,000 rupees, with future updates promised to enable operation with minimal driver intervention. – Reuters The tightened US export curbs have come as China’s economy wavers, with domestic consumers reluctant to spend and a prolonged property sector crisis weighing on growth. President Xi Jinping urges China to be more self-reliant amid rising global uncertainty. The Financial Times reported in May that Nvidia was planning to build a research and development centre in Shanghai. Neither Nvidia nor the city’s authorities confirmed the project to AFP at the time. China’s economy grew 5.2% in the second quarter, official data showed, after analysts forecast strong exports despite trade war pressures. – AFP

TOKYO: Toyota and Hyundai Motor may have a beef with US protectionism, but they have one thing in common with President Donald Trump: when it comes to global car markets, it’s America first for Asia’s legacy automakers. Trump’s tariffs on imported automobiles have upended the outlook for the global industry, yet the US remains by far the most important market for Japan’s Toyota, South Korea’s Hyundai and Asian rivals including Honda and Nissan. North America accounts for at least 40% of the revenue at both Toyota and Hyundai, filings show. The market’s importance is unlikely to change any time soon, industry insiders and analysts said, especially with China, now the world’s biggest auto market, dominated by homegrown electric vehicle makers such as BYD. Those Asian legacy carmakers with more robust margins and a strong hybrid lineup such as Toyota, Hyundai, Kia Corp and to a lesser extent Honda – are more likely able to weather the US tariffs storm, and potentially take market share from weaker players like Nissan, analysts said. “The environment that we’re in now is becoming increasingly harsh and uncertain, starting with US tariffs,” Mazda executive officer Noriyuki Takimura told reporters at an event in Tokyo last week. Mazda aims to strike a balance between “defensive” measures like cost-cuts and “offensive” ones like strengthening its product lineup, he said. industry changes may drive market shift, say analysts o Strong hybrids, steady pricing, and BEIJING: US tech giant Nvidia said yesterday it will resume sales of its H20 artificial intelligence chips to China, after Washington pledged to remove licensing curbs that had put a stop to exports. The California-based firm produces some of the world’s most advanced semiconductors but is not allowed to ship its most cutting-edge chips to China owing to concerns that Beijing could use them to boost its military capabilities. It developed the H20 – a less powerful version of its AI processing units – specifically for export to China, although that plan hit the skids when the Trump administration firmed up

Long-time car brands step up US production, hoping strong roots will weather future challenges. – PEXELS PIX

merger talks with Honda that fell apart this year. Mazda, which is 5.1% owned by Toyota, and Subaru, which is 21% owned by Toyota, could become more reliant on the bigger company. While Hyundai and Kia have three US factories, they still import about two-thirds of the vehicles sold there. Toyota manufactured 1.3 million vehicles in the US last year, equal to 54% of the vehicles it sold there. Japanese automakers have invested more than US$66 billion (RM281 billion) in US manufacturing since the 1980s, building some two dozen plants, according to the JAMA auto lobby group. At a White House event attended by Trump in March, Hyundai shared a US$21 billion plan to build a steel plant and raise US output to 1.2 million cars a year. The tariffs are likely to encourage Japanese and South Korean automakers to invest more into expanding production capacity and localising supply chains to protect their positions, said Justinas Liuima of research firm Euromonitor International. – Reuters but in recent years the US export squeeze has left it battling tougher competition from local players such as homegrown champion Huawei. Beijing has decried Washington’s curbs as unfair and designed to hinder its development. Huang, an electrical engineer, told Chinese Vice-Premier He Lifeng on a visit to Beijing in April that he “looked favourably upon the potential of the Chinese economy”, according to state news agency Xinhua. He said he was“willing to continue to plough deeply into the Chinese market and play a positive role in promoting US China trade cooperation”, Xinhua reported.

not take our hands off the US” The US has seen a surge in demand for hybrids as consumers have become more concerned about the battery range, price and charging hassles of EVs. Fuel efficient models such as hybrids will be a key driver to gaining market share, said Morningstar analyst Vincent Sun. Toyota, Hyundai and Kia have particularly strong hybrid offerings. So far, most legacy Asian automakers have avoided raising prices in the US and stronger players are likely to continue to hold off doing so, despite lower profitability, analysts said. Instead, the focus will likely be on taking market share from lower-margin rivals like Nissan and Stellantis, analysts said. “It will shape up like a game of chicken,” said Kim Sung-rae, an analyst at Hanwha Investment & Securities. “Those who will hold up well will emerge as winners.”

response to tariffs, even as they acknowledged the difficulties ahead. All four spoke on condition of anonymity. The US is Toyota’s biggest market in terms of vehicles. It sold 2.3 million vehicles there in 2024 including its Lexus brand, accounting for more than a fifth of its global total. As a source of revenue, North America was second only to Japan in the last financial year. Hyundai’s North American revenue was the highest in almost a decade last year. Kim Chang-ho, an analyst at Korea Investment & Securities, estimated it generates around 60% of its profits from the US, thanks to higher vehicle prices. Mocked in the US in the 1980s for its perceived shoddy quality, Hyundai doubled down there around a decade ago, especially after tensions between Beijing and Seoul, and the rise of domestic EV makers saw it start to lose ground in China. export licence requirements in April. The company said in a statement yesterday that it was“filing applications to sell the Nvidia H20 GPU again”. “The US government has assured Nvidia that licences will be granted, and Nvidia hopes to start deliveries soon,“ the statement said. Nvidia CEO Jensen Huang said in a video published by Chinese state broadcaster CCTV yesterday “the US government has approved for us (to file) licences to start shipping H20s, and so we will start to sell H20s to the Chinese market”. “I’m looking forward to shipping H20s very soon, and so I’m very happy with that very, very good news,“ Huang,

Two Hyundai insiders and two Japanese auto executives separately told Reuters they had no intention of downsizing their US businesses in Nvidia to resume H20 AI chip sales to China “After years of putting in effort, our brand is finally gaining recognition in the US,” one of the Hyundai insiders said. “So we will Over time, tariffs could be a catalyst to help drive consolidation in the industry, or at least deepen existing tie-ups. Investors wonder if tariffs could push Nissan to revive

wearing his trademark black leather jacket, told a group of reporters. CCTV said in a separate report that Huang would attend a major supply chain gathering today. The Taiwan-born executive “will be present at the opening ceremony of the 3rd China International Supply Chain Expo on July 16 and will participate in related activities”, the broadcaster said. It cited the China Council for the Promotion of International Trade, an official body controlled by Beijing’s commerce ministry. It will be Huang’s third trip to China this year, according to CCTV. China is a crucial market for Nvidia