Okay, now add the labour of every other step of the process too. The 15% is at VW’s own factory. But they buy parts from, among others, Bosch and ZF who also have employees producing the parts.
Then also add the labour costs for R&D. BYD’s average employee salary in China, including everyone from manufacturing to design to engineering to leadership, was less than half of what the manufacturing plant employees make at VW’s German plants and still significantly less than the Bratislava plant. Only top level leadership at BYD gets high salaries.
Which is why VW has been fighting the IG Metall union for the right to close down plants they can’t afford to run because their cars aren’t expensive enough to be profitable at these labour costs.
It’s gonna suck for everyone involved, but that’s just what you have to accept if the biggest economy in the world has both super cheap labour AND manufacturing subsidies. It’s game over for everyone else unless people are willing to take a major pay cut.
ChatGPT says 10-15% of the cost of a typical car is labor
So that would give Chinese manufactured vehicles a 6-10% price advantage
We wish
Okay, now add the labour of every other step of the process too. The 15% is at VW’s own factory. But they buy parts from, among others, Bosch and ZF who also have employees producing the parts.
Then also add the labour costs for R&D. BYD’s average employee salary in China, including everyone from manufacturing to design to engineering to leadership, was less than half of what the manufacturing plant employees make at VW’s German plants and still significantly less than the Bratislava plant. Only top level leadership at BYD gets high salaries.
Which is why VW has been fighting the IG Metall union for the right to close down plants they can’t afford to run because their cars aren’t expensive enough to be profitable at these labour costs.
It’s gonna suck for everyone involved, but that’s just what you have to accept if the biggest economy in the world has both super cheap labour AND manufacturing subsidies. It’s game over for everyone else unless people are willing to take a major pay cut.