On July 4, the European Commission imposed provisional additional tariffs of up to 37.6 percent on Chinese electric vehicle (EV) makers. In response, China filed an appeal with the World Trade Organization on August 9, challenging the extra duties as detrimental to the development of the global EV industry and green transformation cooperation.
As China’s EV sector advances rapidly in battery technology and software development, leveraging its vast domestic market, the European Union faces a critical decision: how to engage with China’s burgeoning EV industry rationally and constructively.
In recent years, China’s EV industry has emerged as a global leader, thanks to its mastery of core battery technologies, an extensive manufacturing chain, and supportive industrial policies. Chinese EV companies have forged comprehensive strategic partnerships with major automakers worldwide, creating an industry ecosystem that accelerates innovation and development.
For instance, BYD, a leading Chinese EV manufacturer, signed an agreement with Toyota in 2019 to establish a battery research and development venture. BYD is also collaborating with Foshan Plastics Group to build electronic sensors for light detection and control. These critical collaborations have enabled Chinese EV companies to expand their global footprint and contribute significantly to the industry’s growth.
According to the Global EV Outlook 2024 by the International Energy Agency, in 2023, over 50 percent of all electric cars sold worldwide were produced by Chinese automakers, who accounted for just 10 percent of global internal combustion engine car sales. That same year, China exported over 4 million cars, making it the world’s largest auto exporter. Of these, 1.2 million were EVs, marking a nearly 65 percent increase in overall car exports and an 80 percent rise in EV exports compared to 2022.
Europe is a key market for these exports. Over 19 percent of all electric cars sold across the EU in 2023 were made in China. Notably, more than half of these were from Western carmakers, with 28 percent imported by Tesla and 20 percent by Renault’s Dacia. Chinese brands accounted for only 7.9 percent, indicating that collaboration rather than competition defines much of the market dynamics.
The rapid development of China’s EV industry has accelerated the global energy transition. By 2030, one in three cars on Chinese roads will be electric, while in the U.S. and the EU, it will be one in five, according to the International Energy Agency’s outlook. This shift could reduce global oil demand by 6 million barrels per day, equivalent to current U.S. road transport consumption. The global consensus is clear: Accelerated green energy development is crucial for decarbonization, and China’s affordable EV technology is a vital contributor to this effort.
Moreover, China’s EV industry brings innovative technology and manufacturing processes to the global automobile sector. Their rapid product development cycles, integrated supply chains, consumer-centered marketing, and competitive pricing are changing automotive market dynamics and reshaping the future of the industry.
Rather than viewing Chinese EV makers as competitors to be stifled, there is an opportunity for mutual growth and collaboration. Embracing the strengths of Chinese EV technology can drive the global green transformation forward, benefiting economies, consumers, and the environment alike.
Reference(s):
Friends, not foes: Chinese EVs drive global green transformation
cgtn.com
