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Electric & new energy vehicles
Opinion
Victoria Mio
Victoria Mio

Macroscope | China has early lead in EV race but right investments can make it anyone’s game

  • It is hard to dispute that China is ahead of the curve when it comes to supporting domestic electric vehicle production and encouraging their adoption
  • Other countries are emulating China’s policies and finding new innovations in manufacturing and production, though, so China’s triumph is far from secure

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Visitors inspect a Tesla Model Y sport utility vehicle at the electric vehicle maker’s showroom in Beijing on January 5, 2021. China is the front-runner in the electric vehicle market at the moment, but the space for innovation and adaptation mean its dominance is not assured. Photo: Reuters
Victoria Mio

It is undeniable that electric vehicles (EVs) have grown in popularity and become more mainstream during the past decade. In fact, the world’s top carmakers are reportedly planning to spend nearly US$1.2 trillion through to 2030 to develop and produce millions of EVs.

IHS Markit expects that EVs will make up about 60 to 80 per cent of all new car sales by 2050. This magnitude means most carmakers and countries will not be able to ignore this fast-growing phenomenon. For those looking to join this exciting ride, there is much to learn from China.

The country is already the world’s biggest market for EVs based on annual sales, and it is also ahead of the game when it comes to infrastructure. BloombergNEF’s Zero-Emission Vehicles Factbook 2022 calculated that cumulative investment in EV charging hardware and installation reached US$62 billion at the end of 2022, of which 61 per cent is attributed to the more than 600,000 public chargers built in China.
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This trajectory is unlikely to change or even slow down any time soon. A recent survey by Fidelity International highlighted that the penetration rate for EVs in the world’s most populous country could be set to further accelerate significantly thanks to technological advances in the field, gaining a much bigger share of mainstream auto sales going forward.

The study revealed that around 60 per cent of current car owners in China and 84 per cent of non-owners would prefer an EV to an internal combustion engine model for their next purchase. This is a significant percentage and highlights the fact that we could potentially see EVs dominate the roads in China in the near future.

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It is hard to dispute that China is ahead of the curve. There is much the world can learn from observing its boom in EV adoption.
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