Home Tech American media: China is expected to become the world’s electric car factory
American media: China is expected to become the world's electric car factory

American media: China is expected to become the world’s electric car factory

by YCPress

American media: China is expected to become the world’s electric car factory, that China may be the world’s factory, but it has never been a major exporter of automobiles.┬áNow China hopes to use electric vehicles to change this situation.

According to the US “Wall Street Journal” website reported on October 23, progress is satisfactory: Tesla announced this week that it will start exporting Model 3 cars made in China to some European countries; BMW’s iX3 electric vehicles sold worldwide The sports utility vehicle will be produced by BMW Brilliance, a joint venture between BMW and its Chinese partner.

According to the report, China is the world’s largest auto market, with approximately 25 million auto sales in 2019, but China only exported approximately 1 million vehicles last year, and mainly exported to developing countries. Most Chinese brands are not well-known in developed markets. Foreign auto companies use their Chinese factories to make cars mainly for the local market, not for export. Foreign auto companies have begun to use China as an export hub for electric vehicles, which bodes well for China.

The report also said that the relaxation of restrictions on foreign auto companies in China has had an effect. For a long time, foreign auto companies must establish joint ventures with Chinese partners and share profits in order to manufacture cars in China. In 2018, such regulations for electric vehicles will be cancelled; in 2022, such regulations for other types of vehicles will also be cancelled.

The report pointed out that Tesla took advantage of this policy adjustment to become the first foreign auto company to have a wholly-owned factory in China, and began to deliver cars produced at its Shanghai plant this year. Similarly, BMW plans to increase its shareholding in the joint venture with Brilliance Auto from the current 50% to 75% by 2022. Gaining more control and profits probably means that BMW is also more willing to manufacture cars in China for sale in other regions. China drastically cut subsidies for electric vehicles last year, but introduced a credit transaction system to encourage auto companies to produce more electric vehicles.

According to the report, with the help of generous subsidies and government procurement, China’s first-mover advantage in the electric vehicle market has gathered a group of suppliers. China has been the world’s largest electric vehicle market for many consecutive years, although Europe may temporarily take this position with support policies this year.

China has some of the largest electric car battery manufacturers. For example, Tesla has used cobalt-free batteries produced by Ningde Times New Energy Technology Company to reduce the cost of some of its cars manufactured in Shanghai. Volkswagen this year spent 1.2 billion US dollars (1 US dollar is about 6.67 yuan-this net note) to buy a 26% stake in the Chinese battery manufacturer Guoxuan Hi-Tech. Major battery manufacturers in South Korea and Japan also have factories in China.

Of course, it is still at a very early stage. Electric vehicles account for a small proportion of total global car sales. The export plans of global automakers may not have much impact in the short term. Europe is also trying to catch up in battery manufacturing. Tesla will also build a factory in Berlin, which means that the plan to export from Shanghai may only be temporary.

However, the report pointed out that, unlike the era of internal combustion engines, China really has the opportunity to become a heavyweight player in the electric vehicle export market.