China’s electric vehicle (EV) industry has demonstrated remarkable resilience and growth, even as the global market faces a temporary stagnation in demand. Last year, China’s EV exports surged by 70% compared to the previous year, reaching an impressive $34.1 billion. This growth is underscored by the domestic sales ratio of “new energy vehicles” (NEVs), which includes battery electric vehicles (BEVs), fuel cell electric vehicles (FCEVs), and plug-in hybrid electric vehicles (PHEVs), hitting a record high of 51.1%.
According to the report “China’s EV Innovation Strategy and Implications” published by the Korea International Trade Association’s International Trade and Commerce Research Institute on September 9, China’s EV exports and domestic sales have both maintained an upward trend despite global concerns over stagnant EV demand. In July of this year, the domestic sales ratio of NEVs expanded to 51.1%, surpassing internal combustion engine vehicles for the first time.
BYD, China’s largest EV manufacturer, has played a pivotal role in this growth. The company has adopted an internalization method that directly produces EV parts, establishing a stable competitive foundation by internalizing the entire EV supply chain. Last year, BYD’s R&D investment increased by 112% compared to the previous year, reaching 39.57 billion yuan (approximately 7.5 trillion won). As of the end of 2023, BYD has filed a total of 48,000 patents and employs 100,000 R&D personnel.
BYD’s strategic expansion into overseas markets has also been noteworthy. Since July of this year, the company has launched four models and operated a local plant in Rayong, Thailand, with an annual capacity of 150,000 units. Additionally, in the second half of the year, BYD is expanding its overseas bases to Brazil, Hungary, Uzbekistan, and Pakistan, following the completion of its EV plant in Brazil.
Jeon Bo-hee, a senior researcher at the Korea International Trade Association, commented on the aggressive international strategy of Chinese EV companies: “Chinese EV companies are actively targeting overseas markets beyond the domestic market. If EV demand in emerging markets such as Southeast Asia, Brazil, and Mexico becomes full-fledged, competition with China in these markets is expected to become even more intense.”
The global EV market has been experiencing a temporary stagnation in demand due to various factors, including economic conditions, consumer behavior, and technological advancements. However, China’s significant role in the global EV industry, supported by government policies promoting NEVs, subsidies, infrastructure development, and favorable regulations, has enabled it to maintain growth. The vertical integration in manufacturing, as seen with BYD, contrasts with traditional subcontracting practices and provides a competitive edge.
Source: Businesskorea, Sep 10, 2024. https://www.businesskorea.co.kr/news/articleView.html…