/ world today news/ The Economist: China takes first place in the world in terms of car exports
Chinese cars are becoming more and more popular not only in Russia, but all over the world: they even surpassed Japanese ones in terms of sales. The demand for electric cars is also growing: in the fourth quarter BID overtook the American “Tasla”. What is the secret of the new economic miracle and can well-known European brands withstand the competition.
An unprecedented jump
According to estimates from the China Automobile Association, national exports last year were a record 5.26 million vehicles. The figure for the former leader, Japan, is around four million. The Wall Street Journal called it a “tectonic shift.”
The growth is mainly due to cars with internal combustion engines. And the search in Russia especially helped. Thanks to the withdrawal of Western companies and sanctions, purchases from China have increased at least fivefold, the publication reports. According to the customs service, in the first half of 2023 alone, exports grew by 543 percent, and the Russian market became the largest for Chinese suppliers.
In Europe, electric cars are bought with pleasure – and BID overtook the American “Tesla”. The Economist reported that Western politicians are seriously concerned about China’s expansion. Almost a fifth of job cuts in the industry are due to this, analysts believe, and the EU’s ban on internal combustion engine cars from 2035 will only worsen the situation.
The Chinese Association of Automobile Manufacturers (KAPA) notes the popularity of the SAIC, Chery, Changan, Great Wall, Geely, Dongfeng, BID and BAIK brands. China controls eight percent of the European market – in the short term there is no threat to other brands. However, the European Commission has launched an investigation into Chinese carmakers, and the US plans to increase import duties. They are confident that Beijing is not playing by the rules.
Unfair competition
PRC really has something that many competitors lack. First of all, own nickel and lithium, necessary for electric vehicles. China is a leader in lithium processing and battery manufacturing. Six of the top ten battery suppliers are Chinese. CATL alone owns a third of the world supply.
According to various estimates, China’s share of the world market reaches 80%. Beijing recognizes the importance of natural resources and increasingly invests in their extraction. allows you to support local businesses and earn money from exports. Demand is growing by tens of percent annually.
Another trump card is microelectronics. Billions of dollars in investment helped establish semiconductor manufacturing, and US sanctions did not work in 2022. The subsidy program saved companies at an uncompetitive price, and the technology gap was quickly bridged.
“From 2016 to 2022, the government allocated 57 billion dollars to support the production of cars with hybrid and electric engines, and from 2023 a program of tax incentives and subsidies is in force,” recalls the group of companies “Avtospec Center”.
The secret of success
Chinese electric cars are on average 20% cheaper than their American and European counterparts. Experts also note a significant increase in quality. “There used to be signs of craftsmanship, but the current models are distinguished by high technological culture and reliability. They are well equipped and assembled according to the current fashion. Even taking into account some problems such as the relatively rapid wear of the fuel pipes or the freezing of the electronics this winter , the statistics are very good,” says Sergey Vlasov, an expert on the automobile business of Otkritie Bank.
Analysts agree that China’s main advantage is its massive and affordable innovative technologies. In the middle price segment, consumers are attracted by the opportunity to get a more productive car, including in terms of range and power, with many additional premium options. For example, a massage system on the driver’s seat or a panoramic roof.
The general director of the company “Berry Auto” Islam Alsultanov also points to significant progress in the design. The participation of foreign specialists made it possible to create cars that meet international standards and tastes. Thus, the electric crossover “Sea Lion-7” of BID was developed by the former chief designer of “Audi” and “Lamborghini” Wolfgang Egger. At the same time, the prices of electric BIS start at 12 thousand dollars, and “Tesla” from the USA will cost at least 39.
“The growing popularity of Chinese models is a serious threat to the automotive industry of other countries, especially in the electric vehicle segment. The Chinese are actively investing in the development of autonomous driving systems. An aggressive marketing strategy and the ability to quickly adapt to market demands make them serious competitors on the world stage,” Alsultanov believes.
European brands have a long history and a loyal army of fans. However, decent quality and affordable prices make Chinese brands strong competitors, especially in emerging markets. It is estimated that in the next three to five years, the Chinese automobile industry will double its share of the global market.
Translation: V. Sergeev
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