Chinese firms eye Morocco as way to cash in on US electric vehicle subsidies

People inspect electric vehicles made by Chinese automaker BYD during an auto fair in Jakarta, Indonesia, Wednesday, June 19, 2024. That's partially because Chinese firms see it as a side door to access the U.S. market and new Biden administration subsidies designed to shut them out.

Critics say the rules are a giveaway to China and will extend its EV dominance. The Biden administration says the rules pave the way for billions in investment in EV manufacturing in the United States.In Morocco, a largely agrarian economy where the median income is $2,150 a month, giant industrial parks full of American, European and Chinese component makers have sprung up in the rural outskirts of Tangiers, Kenitra and El Jadida.

Though CNGR owns slightly more than a 50% stake in the project, Thorsten Lahrs, CEO of its Europe division, said he's confident its cathodes can qualify for the tax credits and change its board composition if necessary. If not, the company would pivot to other markets, including Europe, which just hiked tariffs on electric vehicles imported from China.

The largest among them is Chinese-German battery-maker Gotion High-Tech, which signed a deal with Morocco last year for $6.4 billion investment to construct Africa’s first electric vehicle battery factory. Officials in Morocco have publicly and privately worked to foster ties up and down the automotive supply chain in both the East and the West. The country hosts more than 250 companies that manufacture cars or their components, including Stellantis and Renault as well as Chinese, Japanese, American and Korean factories that make seats, engines, shock absorbers and wheels. The industry exports almost $14 billion in cars and parts annually.

“Under the Biden administration’s electric vehicle regulations, America’s working families will have to watch their hard-earned tax dollars go to line the pockets of Chinese billionaires and businesses with links to the Chinese Communist Party,” U.S. Rep. Jason Smith, a Missouri Republican, said of the new guidelines.

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