Electric vehicles are becoming more and more popular and show their “expansion” globally. The driving force mainly comes from the “greening” policies of the governments of other countries as well as the increase in demand for environmentally friendly cars by consumers.
Holding an important link in the battery supply chain, China increasingly dominates the global electric vehicle market
Of course, China – the world’s second largest economy will not miss the attractive “market share pie”. The proof is that Chinese domestic electric car brands, even corporations that manufacture phones like Xiaomi or Huawei, do not leave themselves out of the race to dominate the international electric vehicle market.
Chinese electric cars are expensive
Following the trend created by electric car giant Tesla, domestic brands like Xpeng or Nio have launched many beautiful models with the ability to go long distances. The above advantages quickly attracted consumer tastes and brought a large number of orders to manufacturers in a short time.
Nio launched many beautiful models with the ability to go long distances (Source: Reuters)
For example, the P5 family sedan assembled by Xpeng, after only 4 months of rolling off the production line, achieved a record sales of 5,030 vehicles in December alone. This is also the first electric car model in the world. world equipped with lidar sensor, sold for 223,900 yuan, or more than 35,000 USD.
The ET5 model of the Nio brand launched on December 18 also witnessed a large number of pre-orders. Not only owning PanoCinema, a panoramic digital cockpit with AR and VR technology, the ET5 is also equipped with driver assistance technology developed by Nio himself. This mid-size car is priced higher than the P5, starting at 328,000 yuan before subsidies.
Huawei, the smartphone giant, seems to be unrelated, but is also cooperating with many car manufacturers in the field of self-driving technology. Officially entering the “race” of electric cars in China from the end of 2021, Huawei “starts” with Aito M5 – a car powered by both electricity and fuel with HarmonyOS operating system that is expected to beat the Model Y of Tesla. With more than 6,500 orders recorded after only 4 days of launch, Aito M5 is expected to be able to compete directly with billionaire Elon Musk’s Tesla darling.
Xpeng cars are becoming more and more popular in the mainland (Source: CNBC)
Electric vehicles from Nio, Xpeng or Huawei in particular and the Chinese electric vehicle industry in general are becoming increasingly popular in the mainland. Their presence gradually compares with traditional gasoline cars in the context of Chinese officials setting a target that within the next 15 years, all domestic cars will be electric. Therefore, this market in China is expected to gradually transform, from being “fed” by the government subsidy program, to self-growing strongly thanks to a lever called user demand.
A market that has passed its infancy
The above assessment of experts is reasonable, because China is no longer a nascent electric vehicle market. According to estimates by the China Passenger Car Association, in 2021, sales of NEV new energy vehicles will reach about 2.4 million units, including pure electric vehicles, hybrid vehicles (electric vehicles and hybrid vehicles). gasoline) and fuel-cell (electric vehicle powered by liquefied hydrogen gas). The production speed of electric vehicles of some prominent brands such as Xpeng or Nio is even faster than what Tesla has done since the early days.
According to a representative of Xpeng, this company has produced 100,000 electric cars after 6 years of establishment, while Tesla takes up to 12 years to produce the same number of cars. China’s battery and car maker BYD also said it has produced 1 million new energy vehicles, including both pure electric and hybrid vehicles.
This success is largely due to the support policy from the mainland government. By the end of March 2021, China has spent about 60 billion USD in subsidies and 500,000 charging stations (5 times more than the US) to develop the new green car market. A series of support policies such as free registration, refund and corporate tax reduction also help the electric vehicle industry here enter a period of rapid development.
Besides, China has done a seemingly very difficult task, which is synchronizing the infrastructure of charging stations. Data from the EVCIPA Electric Vehicle Charging Infrastructure Promotion Alliance shows that, as of October 2021, China is providing more than 2.2 million EV charging stations across the country, more than double that China’s electric vehicle infrastructure is therefore appreciated, while other countries, including the US, still have a lot of work to do.
Chinese people increasingly prefer electric cars (Source: Reuters)
In addition to the support from the government, the change in consumer tastes, from traditional cars to electric cars, is also a factor that helps this market boom. “Consumers are beginning to realize that electric vehicles can change the way we travel. They gradually become interested in new electric vehicles,” said Bryan Gu, president of electric car company Xpeng.
Mr. Michael Dunne, CEO of electric vehicle company ZoZo Go also shared: “In 2020, the market for electric and hybrid vehicles in China has completely changed. The survey shows that, for the first time, consumers Consumers no longer care about subsidy policies when buying electric cars. They focus more on models and the distance they can go after a single charge.”
Thanks to its great development potential, China aims to have 1 out of every 4 cars on the road by 2025 be a new energy vehicle. By 2035, all cars circulating in this country are expected to be electric or hybrid vehicles, which use both an internal combustion engine and an electric motor. The government’s effort also aims to realize the goal of being carbon neutral for the world’s second largest economy by 2060.
China is ambitious to dominate the international electric vehicle market (Source: Nikkei)
Not stopping there, China also aspires to dominate the international electric vehicle market with the number of vehicle deliveries expected to reach a record 20 million units by 2030. After slowly gaining a foothold in Europe and competition In direct competition with Volkswagen and Peugeot, Chinese electric car manufacturers also have ambitions to expand in Japan – which is known as the cradle of the world auto industry. They choose to penetrate by electric vehicle with high performance but at a very competitive price.
Owning a giant in the field of electric vehicle batteries
Many experts believe that one of the factors that gives China an advantage to accelerate in the electric car race is that this country is dominating the majority of the battery manufacturing market. In it, CATL (Contemporary Amperex Technology Limited) represents the way to dominate the global EV battery industry and the new energy field of Mainland China.
CATL is currently the world’s largest maker of electric vehicle batteries with a market value larger than General Motors and Ford combined. After announcing an investment of 24 billion yuan ($3.77 billion) in expanding battery production capacity in Sichuan province last December, CATL began construction of an industrial park in Hubei province. to power 4 million electric vehicles. In addition, the company is also considering building new factories in Poland and Germany to expand the scale of operations.
CATL represents the way to dominate the global EV battery industry and mainland China’s new energy sector (Source: Nikkei)
As the world’s most profitable electric vehicle battery maker, CATL currently powers a wide range of major brands, including the giant Tesla. The company is therefore said to be able to help China lead the race in electric vehicle batteries – the central technology in the vast green revolution.
Thus, it is easy to see that China is holding an important link in the battery supply chain, while in the US, this production line is almost zero. This dominance has raised many concerns that a someday, Detroit – the center of America’s major auto industry will gradually become obsolete and Beijing can acquire American driving. However, according to experts, even if it has more advantages, China should not “sleep on victory” because other competitors will not go after too long.
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