China is becoming the world’s biggest car exporter: Why it’s a problem

In 2nd position last year, China is now the world’s leading car exporter, ahead of Germany and Japan. And that should not delight specialists, who have been sounding the alarm for several months already.

As demand for electric cars continues to grow, China sees an opportunity to conquer the global market. Many young brands are emerging, such as Geometry or Nio, and are now trying to export to Europe. Their goal: to attract as many customers as possible with affordable prices and to undermine Tesla’s dominance.

A sharp rise

It will still take a lot of work before dethroning the manufacturer, still world number 1 and having placed its Model Y at the top of sales in the 1st quarter. However, the competition is increasingly tough for the firm of Elon Musk, and for all the others. Last year, China was already the world’s second largest exporterhaving succeeded in dethroning Germany, but still remaining behind Japan, notably with Toyota.

But now the Middle Empire has made a significant rise in power during the 1st quarter of 2023. This has indeed exported no less than 1.07 million cars and light commercial vehicles worldwide between January and April. This equates to an increase of 58.3% compared to the same period in 2022, as the account explains. Twitter Science Is Strategic.

China 🇨🇳 is now the world’s largest auto 🚙 exporter

Short 🧵 below on China’s rise as an automotive superpower 📈 (1/9)

Cc: @Noahpinion @ElbridgeColby @NickKristof @Brad_Setser @PekingMike pic.twitter.com/rKFM9nVFAQ

— Science Is Strategic (@scienceisstrat1) May 24, 2023

Without surprise, it’s thanks to the sales of electric cars that China has achieved this incredible performance. Indeed, “NEVs” (New Energy Vehicles), which also include plug-in hybrids, represented a third of exports, i.e. about 380,000 in the first quarter. A figure up 93% compared to last year. Which is not surprising, since many Chinese manufacturers are starting to sell their cars on the Old Continent, such as BYD, Nio or even Xpeng, among others.

If Tesla remains the world’s leading exporter of electric cars at present, when it sold more than a million cars last year, the firm is closely followed by the SAIC group (MG, Wuling, etc.) as well as BYD. The manufacturer is also currently working on the launch of its Seal and Dolphin on the Old Continent, a few months after being present at the Paris Motor Show.

A worrying situation

None of this is obviously very positive, whereas the specialists had already sounded the alarm a few months earlier. Indeed, the Jato organization claimed last October that one in five electric cars sold in Europe came from the Middle Kingdom. A figure that must have increased considerably since then. Moreover, 18% of electric models marketed on the Old Continent come from a Chinese brand.

A recent study also stated that by 2025, more than 800,000 vehicles from this country would be exported to us. What would move Europe to the status of a simple importer, which is currently not the case. And of course, that is a concern. Already with regard to pollution, because production in China is significantly more harmful to the environment than in Europe.

Not to mention the logistics, which are also very energy-intensive. But this trend is also undermining jobs on the Old Continent, to the benefit of those based in China. A report by the NGO Transport & Environment stated that ” the continent’s climate and jobs are at stake“. But the European Union is working to find solutions to limit the damage. Several have already been unveiled a few months earlier.

Among them, the implementation of measures similar to the Inflation Reduction Act (IRA) in the United States. The goal ? Encourage companies to produce here with financial aid. At the same time, Brussels still decided to support Nio for the establishment of its battery exchange stations. For its part, the French government plans to reserve the ecological bonus only for cars produced on the continent.

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