Why do China's new energy vehicle exports continue to grow?

The surge in popularity of Chinese new energy vehicles (NEVs) in overseas markets has been widely noticed as China's auto exports hit a record high in 2023.

In 2023, China exported 1.2 million NEVs, a 77.6 percent increase from 2022, according to the China Association of Automobile Manufacturers (CAAM). It accounts for over 24 percent of China's total auto exports last year. China's auto company BYD became the world's leading seller of pure electric vehicles in the fourth quarter of 2023.

Chen Shihua, deputy secretary-general of CAAM, said China is expected to export 5.5 million NEVs in 2024. "The top three overseas markets for Chinese NEVs are Belgium, Thailand and the United Kingdom," Chen added.

The Ministry of Commerce said NEV exports stand as a new driving force for the growth of China's auto exports, though fuel vehicles remain the main force. The ministry also said green transition in the auto industry will create new room of development for auto companies in various countries.

With resilience of supply chains, China's NEV exports has been growing rapidly since 2020 despite the fact that the industry was heavily hit by the COVID-19 pandemic. China has also been improving its efficiency in NEV production by building special industrial chains and large industry clusters in regions like the Yangtze River Delta, Pearl River Delta and the Chengdu-Chongqing area.

The auto industry is a highly globalized industry that demands international cooperation. China and Europe are highly complementary in terms of technology, production capacity, and supply chains. In partnership with local collaborators, BYD has already entered the market of 15 European countries, including the UK, Germany, France, Italy and Spain. Traditional European auto companies could speed up their electrification process, while Chinese EV makers could expand their global market in the process.

Experts pointed out that the rise is not only attributed to attractive prices and higher availability, but also due to improved quality following a series of technological advancement by Chinese automakers.

Chinese car makers filed 41,011 patent applications in areas related to electric vehicle charging and battery swapping from 2010 to 2022, far ahead of any other country globally, according to Tokyo-based company Patent Result.

Globally, battery electric vehicle models launched in 2022 had an average range of 337 kilometers, up from 230 kilometers in 2018. To fight consumers' range anxiety for electric cars, Shanghai-based car maker Nio has demonstrated a new battery capable of powering a vehicle for more than 1,000 kilometers on a single charge in December 2023. The company said the battery will enter mass production in April 2024, offering a longer range than any other electric or fuel-powered car currently on the market.

Industry leaders said Chinese car makers seek to improve the battery performance from various aspects, such as the material, volume, energy density and other technological aspects.

Compared with fuel vehicles, NEVs have a higher power supply capacity and a higher degree of electrification, gaining the advantage in adopting smart technologies. In the years ahead, by carrying big data, cloud computing and other technologies, electric vehicles are supposed to achieve more functions with simplified operation systems, meeting more user needs.

In recent years, the NEV industry has become a key driver in the green transition of China's automobile sector. According to Li Jun, an academician of the Chinese Academy of Engineering, this environmentally friendly shift is a fundamental requirement for the high-quality development of the country's auto industry.

China's automobile sector currently possesses both the foundation and the necessary conditions to embrace this green and low-carbon evolution, Li noted. This includes the accelerated adoption of energy-saving automotive technologies such as hybrid power systems, high-efficiency internal combustion engines and advanced transmission systems, as well as ongoing breakthroughs in the crucial core technologies of NEVs.

China aims to reduce carbon dioxide emissions per unit of added value in the automobile manufacturing industry by 18 percent compared to the 2020 level, and to continue this downward trend beyond 2025.