Will Tariffs Drive Domestic Innovation?

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Will Tariffs Drive Domestic Innovation?

Strategy

by Willy C. Shih and Chigozie Ukachi

April 2, 2025

HBR Staff using Adobe Firefly

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Post In the race to dominate strategic sectors like batteries and electric vehicles (EVs), Chinese manufacturers like CATL and BYD are so far ahead of the rest of the world that they are becoming nearly impossible to challenge. A major reason is the cost advantage they’ve built by leveraging the large demand in their domestic market not just to achieve economies of scale but also to learn how to lower the costs of their production processes.

Post Read more on Strategy or related topics Operations and supply chain management and Government policy and regulation

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