U.S. based electric car and battery manufacturers who are hoping to expand abroad, will have a tough time exporting these products, due to trade restrictions and taxes, according to subscription news service ClimateWire. The report says that U.S. companies who want to do business on foreign shores, may have to start manufacturing there.

“Can we export our batteries to China? The answer is no. You have to build them in-country. And China’s making sure that it happens by the way that they’re structuring incentives,” Jason Forcier, vice president for automotive solutions at A123Systems Inc., said at a conference in July.

Companies like A123, based in Watertown, MA, have already set up a joint venture in China in anticipation of the restrictions.

Earlier this year, the Chinese government asked foreign automakers to enter partnerships with Chinese companies, in which they are limited to a minority stake, if they want to manufacture there.

In Europe, on the other hand, taxes and regulations on American products will make it far too expensive for exports.

“So European business will be won and made in Europe; Asian business will be won and made in Asia,” he said. “Really, the key to growing the battery industry in the United States is, we have to create the demand, right here. Yes, we may not be the biggest auto industry in the world anymore, but the demand has to come from the U.S. in order to create energy independence and jobs in the United States.”

Clearly, companies are catching on. Last month Toyota also went into partnership with a Chinese company to manufacture an EV there.

This will be another huge hit for the automobile industry that has barely recovered from its slump. The Obama administration has spend millions of dollars of stimulus money to help EV- and battery-manufacturers set up shop in the U.S. and to create more jobs here. So in order for our manufacturing jobs to remain, U.S. demand for EVs and hybrids must rise.

Via Green Car Advisor