You Won’t Believe How Tariff Wars and Rare Earth Bans Will Destroy the Price of EVs

EVs were supposed to be the future of affordable, clean transport.

But thanks to the global tariff war and rare earth bans, that dream is on life support. The US-China trade war is now a full-blown economic cage match, and EV affordability is the first casualty. If you’re waiting for prices to drop, think again—this crisis could push EVs out of reach for everyday Aussies.

What’s Happening? Tariffs Are Killing EV Affordability

Trump has slapped a jaw-dropping 104% tariff on Chinese imports. Let that sink in—104%. This isn’t just a tax; it’s a financial nuke aimed at China’s dominance in EV production. But here’s the kicker: it doesn’t just hurt China. It hurts you, the consumer.

Chinese brands like BYD and XPeng have been leading the charge in making EVs affordable. Now, their cars will cost double in the US market, effectively pricing them out. Even American-made EVs like Tesla aren’t safe. Why? Because so many of their components—batteries, chips, and electronics—are sourced from China. Higher tariffs mean higher costs, which manufacturers will pass straight to your wallet.

Rare Earth Bans: The Silent Assassin

As if tariffs weren’t bad enough, China has decided to weaponise its control over rare earth elements. These are critical materials like neodymium and dysprosium, used in EV motors and batteries. Without them, electric cars don’t move—literally.

China controls 70% of global rare earth production and has now restricted exports to the US. This move is a masterstroke in economic warfare but a disaster for EV manufacturers worldwide.

Australia’s Lynas Rare Earths is stepping up, but let’s not kid ourselves—we can’t replace China overnight. Mining rare earths is slow, expensive, and environmentally messy.

How do you feel about rising EV prices due to tariffs and rare earth bans?

• 0%It’ll delay my decision to buy an EV
• 0%I’ll still buy an EV but spend more
• 0%Governments need to fix this now
• 0%It won’t affect me—I’m sticking with petrol

You can vote for more than one answer.

The Fallout: What This Means for Australia

Here’s the brutal truth: EV affordability is dead unless we act fast. Tariffs and rare earth shortages will drive up production costs across the board. That means higher sticker prices for every EV on the market—from budget-friendly BYDs to premium Teslas.

Australia will feel this pain acutely. We’re already lagging behind in EV adoption compared to Europe and the US. Higher prices will only widen that gap. Forget about hitting net-zero targets if Aussies can’t afford to make the switch from petrol guzzlers.

Can Australia Step Up?

There’s a glimmer of hope. Australia has massive reserves of rare earth minerals, and companies like Lynas are already mining them. But we need more than just good intentions—we need action.

Here’s what needs to happen:

• Government Investment: Fund rare earth mining projects and processing facilities.

• Fast-Track Approvals: Cut through red tape to get mines operational faster.

• Alliances: Partner with countries like Japan and South Korea to build alternative supply chains.

  
  

If we play our cards right, Australia could become a global leader in rare earth production. But time is running out—China isn’t waiting for us to catch up.

Drive Change. Drive Electric.