Ford and Nvidia CEOs admit China will win the technology race

The United States has already fallen behind in the technology race. In the view of the CEO of Ford, Jim Farley, and Nvidia, Jensen Huang, China is already alone in leading the dispute for this market.

Farley’s views were expressed to the financial news website Business Insider. For him, Chinese car brands can take the place of Western automakers.

The phenomenon that is about to happen is much deeper than the entry of Japanese vehicles into the market in the 1980s. Although similar, for Farley there is now the difference of the immense scale of Chinese production, capable of supplying the entire North American market.

The warning is made in a tone of concern, since the executive represents Ford. In his view, if this game is not balanced quickly, companies like his will have no future prospects.

As he explains, the forecast is not just due to the production of electric cars, in which China has a wide advantage. The difference is producing cars with all the latest technology on board and integrated with other equipment used by consumers.

According to Farley, even though Chinese cars cannot be sold in the USA, this barrier created is very fragile since companies like Huawei and Xiaomi are very technologically advanced.

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These companies, best known in Brazil for electronic equipment such as smartphones, tablets, notebooks and smart home devices, are already venturing into the automotive sector. Xiaomi produces cars like the YU7, a model recently launched in China and cheaper than the Tesla. Huawei also produces cars like the Seres 7 SUV.

Thus, Chinese automakers have the advantage of producing vehicles fully integrated with their technologies, in addition to being in a country with abundant resources for the production of essential chips for the sector. Farley even confessed that he drove a Xiaomi SU7 for months “out of true admiration for the technology and the product”.

Jensen Huang, CEO of Nvidia, the most valuable company in the world, worth more than US$5 trillion, shares the same observations. For the executive, at the Financial TimesChina will win the Artificial Intelligence race.

For Huang, while China creates incentive mechanisms for its products and submits them to the global market, the United States under Trump adopts restrictions on the sale of Nvidia’s most advanced chips to the Chinese.

He said the US and UK have been hampered by “cynicism”. For comparative purposes, he recalled that China created an energy subsidy policy so that regional companies could operate alternatives to Nvidia chips.

With this ample supply of energy, essential for data centers and equipment production, the North American bureaucracy is unable to match the Chinese advance. Thus, while semiconductors from Huawei and Cambricon are still less efficient than those from Nvidia, network servers from companies like Alibaba have energy at cost to match any lag. Therefore, when these Chinese chips catch up with North American technology, the balance will tip in favor of the Asian giant.