Charging ahead: Chinese NEV firms sprint toward global expansion

2024-02-06 17:11:51   來源:好新聞   作者: Ellison

原標題:Charging ahead: Chinese NEV firms sprint toward global expansion

In the bustling Shanghai Haitong International Automotive Terminal, Lin Jie, a duty manager with nearly a decade of experience, has witnessed a remarkable change. Once a gateway for imports, Haitong Pier is now a bustling hub for the export of new energy vehicles (NEVs) to Europe and other areas around the world.

"Europe, which once resembled a barren desert for our exports, is now increasingly receptive to our domestically produced NEVs," Lin said.

Haitong Pier dominates China's automobile export with a 70% share in roll-on/roll-off exports. Last year, an average of nearly 3,000 vehicles on container ships set sail from this port every day.

Cheng Yunbo, operations director at Haitong Pier, said, "The growth is especially substantial in NEVs, which accounted for over 30% of our exports last year."

Reaching out

According to the China Association of Automobile Manufacturers, China exported a record 1.203 million NEVs in 2023, a 77.6% increase from the previous year, significantly outpacing the growth rate of traditional fuel-powered vehicles and accounting for 24.5% of total automobile exports.

Notably, Chinese brands are rapidly gaining ground in the overseas market. Xu Haidong, vice chief engineer at the China Association of Automobile Manufacturers, noticed a significant trend. "While in 2021, over 60% of China's 308,000 NEV exports were from foreign brands like Tesla, by 2023, about 60% of the 1.203 million NEV exports were Chinese homegrown brands," he said.


Vehicle carrier vessel "BYD EXPLORER NO.1" arrives at Xiaomo International Logistics Port in Shenzhen, Guangdong province, on Jan. 14, 2024. (Xinhua)

For example, BYD, a leading Chinese EV maker, overtook Tesla as the world's biggest EV seller in the fourth quarter last year, with its footprint extending to more than 70 countries across six continents. In 2023, BYD exported more than 242,000 NEV passenger vehicles, marking a growth rate of 334% year on year, the company said.

In Thailand, BYD's total sales reached 30,650 units last year, capturing a market share of 40% and leading the country's pure electric vehicle market. In Brazil, it dominated 72% of the country's pure EV market last year with a total sales of 17,947 units.

Meanwhile, the global reach of China's NEVs is expanding, from exporting only to developing regions to taking a foothold in the developed world. In 2023, the top three destinations for Chinese NEV exports were Belgium, Thailand, and the U.K., according to data from China Customs compiled by the China Association of Automobile Manufacturers.

The European Commission has noted a significant rise in China's share of EVs in Europe, from around 8% in 2022 to a projected 15% by 2025.

Zhang Yongwei, vice president and secretary-general of China EV100, an industry think tank, attributes China's rapid expansion to a decade of strategic shift toward the NEV sector.

Furthermore, Zhang said the combination of a complete auto industrial chain, intelligent technologies, and continuous innovation has enabled Chinese NEV firms to thrive in "its new round of globalization drive."

He cited batteries, a core component of NEVs, as an example. The cost of batteries in China dropped 40% between 2017 and 2022, and the average energy density increased by 40%, which has positioned China's battery industry as a global leader, Zhang said. Among the world's top 10 EV battery manufacturers in the first 11 months last year, six come from China, according to a report by South Korean market research firm SNE Research.

Zhang said this leadership position has empowered Chinese firms to capture a critical window of opportunity.

Price competitiveness also plays a crucial role. According to a teardown report last September by investment bank UBS, BYD's Seal sedan holds a 15% cost advantage over Tesla's China-made Model 3 and an over 30% edge against Volkswagen AG's ID.3.

BYD Seal electric sedan [Photo provided to]

However, John Gong, a professor at the University of International Business and Economics, said he believes that the edge is not just in pricing. "Chinese electric vehicles are rapidly advancing in applications, including interactive screens, vehicle connectivity, and autonomous driving, enhancing consumer experience and showcasing China's strengths beyond cost."

Europe, the next battleground

Many experts believe the European market can be the next battleground for Chinese NEVs.

"Europe is a significant market with favorable geographic and policy conditions for EVs," Gong said. "Overcoming trade frictions, which are more political, can open substantial opportunities for Chinese firms."

In its report, UBS anticipates "a handful of Chinese EV leaders to expand their production footprint globally, with Europe being a top priority." The investment bank said Europe's large, high-mix market, fast-growing EV market with the perspective of becoming 100% electric by 2035, the absence of local disruptor companies, and high segmental overlap with China makes it "the biggest potential win for Chinese OEMs."

Chinese carmakers' market share in Europe could rise from 3% in 2022 to 20% in 2030, according to the UBS report.

Yet in the quest for global expansion, Chinese NEVs companies are navigating a complex international terrain, a road filled with challenges. Late last year, the European Commission officially launched an anti-subsidy investigation into imported Chinese EVs, and France introduced a new subsidy scheme that favors cars made in Europe, indirectly aimed at limiting imported Chinese vehicles.

Gong said, to ensure a sustainable growth in Europe's market share, Chinese NEV firms need to build their own factories there, which can solve many of the local protectionist issues.

Last December, BYD announced a multi-billion euro investment to build an EV passenger vehicle factory in Hungary, with plans to create thousands of jobs and a local green ecosystem for EV manufacturing.

Zhang Yongwei from China EV100 highlighted the importance of adopting a long-term approach, tailoring strategies to meet the unique demands of various markets, and maintaining an openness to introducing the most advanced technologies and supply chains to their target markets. These elements are crucial for the international success and sustained growth of Chinese NEV firms, Zhang said.

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標題:Charging ahead: Chinese NEV firms sprint toward global expansion