used to be the latest technology

on China's roads, but now hundreds

of these models lie forgotten in the giant clearing

lost waves of new and improved Electric Cars.

- The city of Hangzhou is littered

with electric vehicle graveyards.

Just like this one, China has shifted rapidly

to electric cars.

The US is worried that Chinese car makers

could flood its markets with cheap

and good electric cars posing a challenge

to the American auto industry.

- [Narrator] Outdated EVs have been left in fields like this

across China's eastern city of Hangzhou

over the past few years.

- This EV Graveyard has hundreds of electric cars

and the Chinese government has pumped money

into this sector.

There has been technology developing very quickly

in terms of the electric vehicle models.

That also means that the older vehicles become obsolete

relatively quickly.

- [Narrator] Washington is worried that an oversupply

of Chinese EV will flood the global market

and there are already signs of a deluge of EVs in China.

In Hangzhou, we came across hundreds of new EVs

stored out in the open, many of them waiting to be sold.

China has the ability to produce roughly twice as many cars

as it sells at home each year.

The government has thrown its weight

behind the EV industry to cement China's global lead.

- China has the entire ecosystem working for it.

China has battery.

China has all lithium war,

and the entire value chain is predominantly Chinese.

So eventually winner is going to be China.

- [Narrator] That threatens companies like Tesla,

which briefly lost its crown as the top EV seller

to China's BYD last year.

- There's a lot of people who out there

who think like the top 10 car companies are gonna be Tesla

followed by nine Chinese car companies.

I think they might not be wrong.

- [Narrator] Chinese automakers have already

been shipping more electric cars

to Europe raising competition for local players.

The US doesn't want that to happen on its own shores.

To get ahead of the curve, president Biden announced

that he will impose a 100% tariff

on Chinese electric vehicles.

- I'm determined that the future

of electric vehicles will be made in America

by union workers, period.

(crowd applauding)

(upbeat music)

- [Narrator] Despite resistance from the US,

China's EV industry is growing.

The Beijing Auto Show is a chance for car makers

to show off their new EVs before they hit the market.

The sector has attracted dozens

of new players over the years trying to cash in on the boom.

One of them is Xiaomi a tech giant,

best known for its consumer gadgets.

- This is the Xiaomi car.

If you place an order today, you have to wait about six

or seven months to get this car,

and this is probably one of the hottest cars

at this auto show.

Many people are lining up for 30 minutes

or more just to get into this booth to try out this car.

- [Narrator] The company already has around 70,000 orders

in China and says it's highly automated plant.

It's able to build a car every 76 seconds.

Xiaomi SU wants to eventually ship its cars

around the world.

- If anyone wants to start a conventional car company,

they need to have million, hundreds of thousands

of components to come together.

Whereas EVs, the entry barrier is significantly lower.

Components are fewer components are prepackaged,

and therefore, if you and me decide to buy

a starter EV company,

it is relatively easy, it's possible.

- [Narrator] American automakers may also face competition

from established companies like BYD

known for mass producing affordable cars.

It wants to build a factory in Mexico,

which could help it circumvent the hefty tariffs

that the US has on Chinese vehicles.

BYD's cheapest DV model, the Seagull

is sold at around $10,000 in China.

Under the new US Tariff,

a buyer in America would end up paying at least double

that amount for the same car.

China, which firmly opposes the new tariffs,

is already the world's biggest auto exporter.

But gasoline cars still make up a big part of the export.

The US is concerned

that the exports will soon include more EVs.

- You look at American automotive history,

earlier they had the GM 4 Chrysler.

Then Japanese went there.

Now it's the third wave.

Now it's Chinese knocking on their doors

and there is nothing you can do

once you say that you are open market,

you want to promote global marketplace, et cetera,

there is nothing you can do to stop them.

- [Narrator] US automakers pioneered electric vehicles

and the technology that drives them,

but now they're playing catch up in a race

to the top with China.

(gentle music)