Are Rising Oil Prices Setting the Stage for Chinese EVs the Way the 1970s Oil Crises Launched Japanese Cars?
History rarely repeats itself exactly, but it often rhymes.
In the 1970s, two major oil shocks bookended the decade, causing a considerable shift in the automotive market of the time, particularly in the US.
Indeed, the US was known for producing large displacement muscle cars which, while impressive, were not fuel efficient. If consumers believed the worst was over after the 1973 crisis, the 1979 oil shock likely forced them to reconsider their usual choices and give smaller, more fuel-efficient Japanese cars a chance.
The result was one of the most consequential shifts in automotive history: Japanese automakers rapidly gained credibility, market share, and eventually global leadership.
Today, another period of oil price volatility is raising an interesting question: could the current moment do for Chinese electric vehicle manufacturers what the oil crises of the 1970s did for Japanese carmakers?
The parallels are not perfect, but they are certainly striking.
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