Porsche and Other Sports Car Icons Are Losing Appeal in China

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You're listening to Bloomberg Businessweek with Carol Massar and Tim Stenovec on Bloomberg Radio.

**Carol Massar** (0:14)
We wanted to switch gears literally and talk a little bit about cars because a couple stories by our Hannah Elliott definitely caught our attention.
Foreign automakers investing heavily in China, building factories, forging partnerships to see the country's passion for EVs, hoping the world's appetite would grow to match. But apparently the strategy flopped. This is what Hannah has written. She's Bloomberg Pursuits staff writer and car credit co-host of the Hot Pursuits podcast that she does highly recommend. You check that out. She is out there in our Bloomberg News LA Bureau. Hannah, nice to have you here with Emily and me. I want to get right to it. Things change. I feel like we go through these cycles when it comes to the auto market. For so long, we've talked about EVs and everybody leaning in. Tell us a little bit about, though, first of all, what's going on in China.

**Hannah Elliott** (1:02)
Well, it's been really interesting. China has been, for years, touted as the biggest growth market, the most important growth market. Every automaker basically was sort of restructuring their product lines to feed this China market, which isn't unfounded. It's a huge population. There's a lot of money and buying power there. So, of course, China was looking really great. And Chinese buyers love EVs. They love AI. They love really futuristic software. And so a lot of automakers like Porsche, Audi, BMW, Mercedes, all oriented their production lines toward making EVs, capturing this market.
What has happened has been, of course, that the American market and other markets in the world have not adopted EVs at quite the same rate that the Chinese buyers have, which is a problem because America and North America is a huge market for all of these automakers too. So it's really, it's almost a tale of two cities. It's a tale of two cities. They're trying to appease both of these huge markets that want very different things.

**Carol Massar** (2:14)
That's expensive for an automaker, right? To have to kind of play.

**Hannah Elliott** (2:18)
Completely.
It's a billions and billions of dollars worth of money spent. But it's also very difficult time and resource wise. For instance, you know, planning these cars takes years, five, six, seven years in advance to roll out, to go from start, you know, blank paper to now we're in production. That can be five years at a minimum. So you really have to think to the future while you're spending billions of dollars and you're sort of chasing a moving target. So it's really a challenge.

**Emily Graffeo** (2:49)
Okay, so why are the EVs flopping in the US.? Is it just, I mean, look, I'm no expert on cars. So I defer to you completely. Is it just Americans, they like the smell of gasoline? They don't.
Like, it's all about that.

**Hannah Elliott** (3:05)
There's no shame if you do. I do know some people who tell me they literally like the smell of gas, but that's not what we're talking about here. What we're really talking about is a few factors that have really hampered the EV market. I think the number one is the network of chargers. That still remains a really big deterrent to American buyers jumping into EVs. Now, obviously, if you have a charger in your home, that's one thing. But even if you want to drive, say, from Los Angeles to Las Vegas, a lot of us on the West Coast like to do that, it takes a long time to find a charger that's working. The charger network is a really big deal. The other thing too is range anxiety still is a factor. I don't think it's as big as it has been in recent years, but it's still a factor. The bottom line is, a lot of consumers have figured out, we're not going to have to buy these EVs.
States like California, where I am now, continue to roll back their targets for EV proliferation, for cars, emission standards, even the United...
The federal government has done that too. So we sort of realize, oh, we don't have to buy these if we don't want them. And people are creatures of habit. If they've got a car they like, they're going to stick with it.

**Carol Massar** (4:24)
You know, it's interesting you say that. I was driving from New York out to Connecticut, and there's little rest stops, and there's obviously the places to charge. And I'm always expecting there to be a line of cars waiting. There never is. There's always a spot that somebody can kind of pull into.