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Silicon Valley hits out at proposed tariffs on Chinese e-bikes

Time:2018-08-02 Views:97
Silicon Valley hits out at proposed tariffs on Chinese e-bikes

Uber, Bird and Lime have hit out at proposed US tariffs on electric bicycles and scooters imported from China, pitting some of Silicon Valley’s fastest-growing companies against US President Donald Trump. 

In written submissions to the US trade representative, Uber condemns the 25 per cent import duty as a “penalty tax on US companies, job creation, and consumers”, while Lime said the proposals were “misguided, and would result in increased prices for the public”. Bird said that any such move would “hurt American innovation” at a time when no alternative scooter suppliers were readily available in the US. 

E-scooters and pedal-assist bikes have recently grown in popularity in the US with the emergence of app-based rental schemes from Bird, Lime and Uber-owned Jump, which have together received almost $1bn worth of investment during the past 12 months. 

The short-range electric vehicles on which these services rely were included in the Trump administration’s second wave of tariffs on China, proposed in June. 

Electric two-wheelers, alongside ecigarettes and vaporisers, are part of a group of products worth an estimated $16bn in imports from China to the US each year. 

US trade officials have insisted that restrictions on Chinese imports are essential to stem the “Made in China 2025” programme, and boost American competitiveness and manufacturing. However, US businesses have grown more vocal in their criticism of the Trump administration’s protectionist “America First” policies in recent weeks. 

Bird, Lime and Uber all maintained that any tariffs would hamper the growth of a popular, affordable and environmentally friendly new form of transportation. 

Danielle Burr, Uber’s head of federal affairs, wrote that a 25 per cent levy would cause “severe and disproportionate harm to US economic interests, while failing to address China’s acts, policies, and practices that are the intended target” of the measures. 

“Where businesses can absorb this significant increase in costs, this will come at the expense of investment in new technologies, expansion of physical plants, and US job creation,” Ms Burr wrote. “Where businesses are forced to pass on increased costs, consumers will face higher prices and lower availability.” 

The extra cost would also make e-bikes and scooters less competitive with other forms of transport, Uber added. 

A lawyer representing Bird said the Los Angeles-based company “expects to employ thousands of Americans and generate income for hundreds of thousands” in the coming years, including contractors who charge and maintain its rental fleet. “All these American jobs are at risk if Bird’s business model is prematurely disrupted,” it said. 

“Putting a sizeable tariff on scooters will do little to impact the Chinese economy,” Bird wrote, “but risks the stratospheric growth of an American success story without the benefit of supporting an alternative American electric scooter manufacturer”. 

Bird, which raised $300m in funding in June, said that while it had already been “exploring opportunities” to build e-scooters in the US and other countries before the tariffs were announced, it expected to be reliant on imports from China in the “short to medium term”. 

In another letter, Toby Sun, Lime’s chief executive, expressed “deep concern” at the tariffs, which would have a “significant impact on our nascent industry, employees, and customers just as we are establishing our place in the market”. 

Mr Sun, who is himself a Chinese national, added: “My co-founders and I started our company in the United States because of the tremendous opportunities this country offers entrepreneurs to innovate, generate economic growth, and create new products that improve life for everyday people.”