Earlier this month, a new Detroit-based electric vehicle (EV) startup, Slate Auto, entered the market with a pickup truck priced at $24,950. Backed by Jeff Bezos, the vehicle is one of the lowest-cost autos in the US, nearly half the average new vehicle price. However, the US EV industry is struggling to keep pace with global competition, particularly from Chinese manufacturers offering cars as cheap as $10,000.
US EV Market Lags Behind Global Trends
In December, about 20% of new cars sold in the UK were Chinese-made, and 12% of all vehicles sold in the UK last year came from China. Chinese cars also accounted for 6.4% of European Union sales despite new tariffs. However, Chinese cars cannot be sold in the US due to trade restrictions. American buyers prefer larger vehicles with advanced features, leading domestic automakers to focus on high-end models.
According to Dan Krassner, executive director of the American EVs Jobs Alliance, the US is ceding ground in the EV market. “We can’t hand the whole auto industry to Beijing,” he said. “EVs are the big manufacturing prize of the century, and America has to get back in the race.”
Slate Auto’s Affordable but Basic Offering
Slate began accepting preorders last week. Fewer than 5% of new vehicles in the US sold for $25,000 or less last year, down from nearly 21% in 2019, according to Edmunds. The average new vehicle transaction price rose to $48,402. The Slate truck is one of eight US models under $25,000, compared to over 200 EVs and hybrids available in China in the same price range, per industry analyst DCar.
The base Slate truck lacks features: hand-crank windows, no stereo, no ambient lighting, a smartphone mount instead of navigation, and standard cruise control. It has an estimated 205-mile range and is smaller than a Toyota Corolla at 14.5 feet. The company offers 3D-printed accessories, a stereo, and an add-on to convert it into a five-seat SUV. Customers can pay for vinyl wraps instead of paint, eliminating the need for a paint shop.
Jessica Caldwell, executive director of Insights at Edmunds, compared Slate to budget airline Ryanair. “I don’t think they’re going for the stripped-down version because the features, amenities, and technologies – those are part of why prices in the US are so inflated, because Americans wanted all the additions,” she said.
Chinese Competition: BYD Leads the Charge
China’s BYD offers vehicles loaded with features like driver assist for about one-third of Slate’s price. Its premium models, under $15,000, have a 314-mile range. BYD aims to become the world’s biggest automaker within five years and already produces more EVs than Tesla.
Caldwell noted a cultural difference: US consumers love big, powerful, gas-powered vehicles, while Chinese and European buyers are more open to small, practical, cheap cars. US buyers cannot access BYDs or other $10,000 EVs, but if such cars were available, they might take off.
Optimism for Affordable EVs in the US
Despite challenges, Krassner is optimistic. “The price point is really attractive, and we hope Americans see that it matches their budgets and also shows automakers that there is hunger for cheaper electric vehicles,” he said.
