Driving sustainable automotive practices in China policies, innovations, and corporate initiatives
China has rapidly become a global powerhouse in electric vehicle production and export, with nearly 40% of its electric vehicle exports bound for Europe. Despite rising trade tensions and looming EU tariffs, Chinese automakers continue to expand their global reach and innovate in electrification, smart mobility, and sustainability. Backed by strong policy support and ambitious industry goals, China’s automotive sector is reshaping the global market landscape.
Surging exports amid trade tensions and policy shifts
From 2020 to 2023, China's global EV exports increased by 851%, with nearly 40% of those exports destined for Europe. In October 2023, the European Commission launched an anti-subsidy investigation on imports of EVs from China, resulting in a provisional increase in tariffs on Chinese EV exports to the European market. Despite these challenges, China's automotive manufacturing sector has continued to grow at an accelerated pace. In 2023, vehicle production and exports from China reached an all-time high. Growth in the automotive manufacturing industry persisted into the first quarter of 2024, marked by a significant increase in vehicle exports. Of the cars sold, 4.58 million were sold domestically, while 1.11 million were exported, reflecting year-on-year (y-o-y) increases of 6.2 per cent and 34.3 per cent respectively. During this period, the market share of domestic passenger car manufacturers expanded to 59.6%, an increase of 7.4 percentage points. In September 2024, China exported over 60,000 EVs to the EU, achieving the second-highest monthly export level on record, which represents a more than 60% increase from the average monthly exports earlier in the year. This surge in exports was largely driven by Chinese automakers' strategic efforts to capitalize on the EU market before the implementation of new tariffs.
The European Commission has announced plans to impose duties on Chinese EVs, citing concerns over state subsidies that enable these vehicles to be sold at artificially low prices in the EU market. The tariffs, which could reach as high as 45.3%, were set to take effect by October 31, 2024. Analysts forecast that Chinese-owned brands will export approximately 4.5 million passenger vehicles globally in 2024, marking a 29% increase from the previous year. However, the growth rate for battery electric vehicle (BEV) exports is expected to slow to 9%, totalling around 860,000 units. Consequently, the share of BEV exports is projected to decline from 22.5% in 2023 to 19.0% in 2024.