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Does China dominate the global electric car market?

February 20, 2024

China accounted for 63.5% of electric vehicles sold in the world in 2023; China sold 8.87 million cars in the Chinese market in 2023, an increase of 37% over 2022, and China leads the world in relying on cars powered by renewable energy. Cars powered by renewable energy contributed 30% of the total cars sold in China, whether powered by renewable energy or not.

The following graph shows that China is the largest country in the world that contributes to the export of electric cars at a rate of 60%, Europe contributes 15%, and the United States of America contributes 8%:

China has set a number of goals to expand the production of electric cars. The first goal was for 20% of Chinese cars produced to depend on renewable energy by 2025, and indeed that goal was achieved even before reaching the specified date, specifically in 2022. The second goal was for cars relying on renewable energy to sweep the Chinese market. By 2035.

What helped Chinese electric cars rise globally are the measures taken by the Chinese government, including financial support for manufacturers, in addition to limiting the import of non-Chinese electric cars, which gave Chinese electric cars a competitive advantage.

  • China and the West compete to produce electric cars:

Looking at Chinese electric car companies, we will find that BYD has the highest contribution to the sale of Chinese electric cars. It contributed 526,000 cars in the fourth quarter of 2023 only, while Tesla, owned by American Elon Musk, contributed 484,000 cars in the same quarter, and BYD produced 3 million electric cars in 2023, compared to 1.81 million electric cars. Produced by Tesla.

European concern about the Chinese rise in the field of electric cars continues. The CEO of Dawn Insights, Michael Dunn, said that Europe suffers from a lack of manufacturing electric cars, in addition to restrictions imposed on the import of Chinese electric cars, which are considered somewhat cheap compared to their European counterparts.

One of the reasons why Chinese electric cars are relatively cheaper than European ones is that China uses “Auto 3” lithium batteries, which are cheaper than the Model 3 batteries used by Tesla.

Political analysts expect that the United States and Europe are on their way to limiting China's presence as a major player in the infrastructure of the electric car industry due to security risk considerations. Which will certainly affect achieving carbon neutrality in Europe and the West.

The German website "Deutsche Welle" said that the European Union plans to invest in European electric cars by recycling green batteries so that they become self-reliant on themselves and do not need to import basic materials for manufacturing electric cars from China. Europe is expected to recycle 2,100 kilotons annually of electric cars. Batteries by 2040 compared to 50 kilotons currently recycled annually.

Mercedes said it is building a pilot factory in southwestern Germany, specifically the city of Copenheim. With the aim of recycling electric car batteries, it will begin operation by mid-2024.

Despite Europe's efforts to recycle electric car batteries, China remains ten times ahead of Europe in this field.