For American Car Enthusiasts, It’s About To Be The Worst Of Times And The Best Of Times

Yes, I’m aware I’m getting the quote backwards, but that’s just where I think the balance is. If there’s a theme of The Morning Dump lately, it probably comes in the next few opening lines from A Tale of Two Cities, which I’ve always found a little more resonant:

[I]t was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.

Doesn’t that just feel exactly correct to the present moment? Did Charles Dickens predict the trade war?

America is engaged in the worst tit-for-tat with Canada since General Montgomery’s invasion of Quebec, and it’s long been my sense (and the sense of others) that this will mostly benefit China. This also sets up the market for an even stronger bifurcation in car development, meaning that the United States could become its own very specific car market with limited access to cars from the rest of the world. That diminution of the competitive spirit may not help us much. Alternatively, letting Chinese cars in with no barriers isn’t necessarily a better solution.

That’s heavy, so let’s end with something fun. Specifically, let’s end with a decommissioned U.S. Coast Guard light station.

The End Of Fortress North America

For more than a century, American leaders from both of the major parties in the United States looked at Canada as an important ally. Canadian and American soldiers gave that last full measure of devotion side by side along the banks of the Somme and on Normandy’s shores.

We share a long border and an even longer history. Our markets have become interconnected over the years, and this, plus a link with Mexico, has provided a strong bulwark against China. Some call it Fortress North America, but that fortress is crumbling as Automotive News reports:

The trade war comes as the U.S. government and auto industry become increasingly concerned that Chinese automakers and suppliers could use Mexico or Canada as a springboard into the American market. But the chances of the U.S., Canada and Mexico aligning on policies to prevent that have diminished as the future of the United States-Canada-Mexico Agreement comes into question, experts said.

“It’s an opportunity for China in Canada and Mexico,” said Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions. “These are two markets that are open to the idea of a Chinese vehicle being sold there, and because the United States has put up a barrier to those countries, it makes it almost prudent to open up your competitive market to China.”

To what end? To what end? President Trump has stated that he’d basically be happy if Canada didn’t have a car industry, which isn’t going to happen. If Canada can’t make cars for themselves and the United States, it’ll find another partner. At first, that might be China, but I think what’s more likely to happen is that Canada aligns its safety standards with Europe and opens trade there. This, of course, still isn’t that bad for Chinese automakers, as they’re already building cars to European standards.

At the New York Auto Show this year, the head of the Alliance for Automotive Innovation (the lobbying arm for most North American automakers) said that “a trilateral agreement that supports a Fortress North America, that allows this industry to win in the United States and compete around the world” is of extreme importance. He’s referring to the USMCA, there, though any trilateral agreement could work.

Can American automakers win abroad if it only builds cars to its own standards? I’m skeptical.

There’s a quote from that AN article from Drew DeLong, head of corporate statecraft at Kearney Foresight (what a job), that really sends me:

“It’s hard to build a Fortress North America when there are more walls and barriers being established inside the fortress,” he said.

That sounds right to me.

Stellantis Is Trying To Figure Out How To Be A Global Company With A Walled-In America

The United States will, eventually, get some interesting European products in the form of Fiats and Peugeot coming from Stellantis as Dodges, Jeeps, and Chryslers. This might be the exception to the rule as America risks becoming its own little market, which is the challenge facing Stellantis.

Per Reuters:

Stellantis CEO Antonio Filosa said at an analyst conference on Thursday that there is a clear split in the global automotive market today: the U.S., and everywhere else.

The chief of the automaker, which produces Jeep and Ram vehicles, spoke about how the company is navigating a U.S. trade and policy landscape that is diverging from other regions including Europe, especially in regard to how automakers can partner with the Chinese.

“We see clearly the world divided into two things: One is the United States … and then we have the rest of the world,” Filosa said.

When I say this is the “best of times” for enthusiasts, this does mean getting some V8 cars back. Trucks are definitely coming back. Lowered fuel economy regulations might save vehicles like the Golf R. Some older platforms might stick around for a while, though this also means there’s going to be a gap and we’ll have to wait out the new platforms.

I think this is kind of bad for American car enthusiasts in the long run if it persists. We’ve had a golden age over the last few years, when suddenly we weren’t deprived of some of the more interesting cars the world had to offer, like the Audi RS6, because it made sense for automakers to offer low volume vehicles in the United States. Instead, if our market becomes too walled off (and walled in), we risk not getting the rarer stuff because it just becomes too expensive to federalize and import.

Foreign Automakers suddenly are encouraged to just build the same kind of boring crossovers that sell well, and leave the rest to the competition. That would suck.

The ‘Temu Range Rover’ Is A Hit

Allowing Chinese automakers to flood the United States with cars, though, may not be the best solution. China has a lot of unfair advantages and there are reasonable concerns about privacy. At the same time, it would sure help with vehicle affordability.

The UK is probably the most open market that looks anything like the US, and the success of Jaecoo shows how quickly a change can happen. Here’s Bloomberg on how that company is finding customers:

Chery is among Chinese brands that have expanded their collective share of the UK market to more than a fifth in recent years, winning over customers with more affordable models fitted with the latest technology.

While the Chery brand has built a 2.5% market share in less than a year, the group’s surge has been led by the Jaecoo marque with 4.3% last month.

The Jaecoo 7 has become one of the UK’s most popular models, earning itself the nickname the “Temu Range Rover” for being a cheaper version of the British luxury SUV.

Chinese automakers need exports as they’ve built up capacity, even though it’s a huge market. That should also probably be a signal to policy makers in the United States. If we only build cars for ourselves, we can’t build cars for anyone else, and all of that factory capacity we’re hoping to build might suddenly be unnecessary.

XPEL All The Things

While we’ve shown that you can XPEL a lot of different cars, it turns out the paint protection film has other uses. About 34 miles off the coast of North Carolina is the Frying Pan Shoals Tower, a former Coast Guard light station that’s been turned into an eco-tourism destination.

It’s also constantly in the sun, which means that keeping it comfortable requires a lot of work. If there’s ever a high need for some window tint, it’s this place:

With no shade, no landscaping, and near-constant sun exposure over open water, solar heat gain had become a constant drain on the structure’s limited power supply. The newly installed window film blocks a significant amount of solar heat before it enters the building, which helps the tower’s HVAC system work less to keep the space livable, and in turn helps conserve battery and generator power. For a facility that cannot simply plug into the grid, that efficiency gain matters.

Fun!

What I’m Listening To While Writing TMD

Today is the 25th anniversary of the release of Mink Car by They Might Be Giants. Please enjoy “Man, It’s So Loud In Here.”

The Big Question

What’s your favorite low-volume import car?

Top photo: MGM