Why EVs and semiconductor components are about to become costlier

**Why EVs and Semiconductor Components Are About to Become Costlier**
*By Dwaipayan Roy | Oct 11, 2025, 05:28 PM*

The Global Trade Research Initiative (GTRI) has issued a warning that the ongoing trade conflict between the United States and China is poised to drive up prices for electric vehicles (EVs), wind turbines, and semiconductor components. This follows US President Donald Trump’s announcement of a new 100% tariff on Chinese imports, effective November 1, 2025.

This move is a response to China’s recent export controls on rare earth minerals—critical materials used in US defense, EVs, and clean energy sectors.

**Trade Implications: Tariffs Reach Record High**
With the new tariff, the total tariff rate on Chinese goods will soar to approximately 130%, marking the biggest escalation in US-China trade tensions since the initial tariff war began. According to the GTRI report, the impact will be felt swiftly, with prices of EVs, wind turbines, and semiconductor parts expected to rise significantly.

The report also highlights that China may redirect its supplies toward non-Western partners, aiming to strengthen alternative industrial networks amid the dispute.

**Strategic Negotiations: US Reliance on China**
The GTRI emphasizes the strategic importance of rare earth minerals to US industries, suggesting that Washington may soon have little choice but to negotiate a new deal with Beijing.

Unlike the US, which often acts quickly without fully weighing economic consequences, China appears more deliberate and better prepared for prolonged trade tensions. The report also underscores America’s heavy dependence on China for electronics, textiles, footwear, white goods, and solar panels, which leaves it vulnerable to retaliation.

**Economic Impact: Potential Backfire of Tariff Strategy**
As prices rise due to the newly implemented tariffs, President Trump may face challenges in controlling inflation and production costs. The GTRI warns that his tough-on-China approach could backfire, ultimately hurting US consumers and undermining his broader economic objectives.

**Trade Advice for India: Tread Carefully**
The GTRI also advises India to negotiate carefully and on equal terms with the US, ensuring reciprocity and preserving its strategic autonomy.

Instead of relying on shifting US promises, New Delhi is encouraged to focus on building self-reliance in critical technologies and minerals. This strategy will help shield India’s economy from future trade shocks and allow it to leverage its neutral position to strengthen ties with both Western and BRICS economies.

*Source: Global Trade Research Initiative (GTRI)*
https://www.newsbytesapp.com/news/business/us-china-trade-war-to-spike-ev-wind-turbine-costs-report/story

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