In recent years, China’s automotive industry has been on the rise, especially in the export of complete automobiles. A few years ago, China has consecutively surpassed Korea and Germany to become the world’s second largest car exporter, and according to foreign organizations, China has officially surpassed Japan this year to become the world’s largest exporter of automobiles.
China’s many independent brands have issued a strategy to go overseas, and closely to South America, Europe and other regions to set up the automobile export business. So, China has become an automotive powerhouse?
China’s automobile rolls to the world
As an important engine to drive the growth of automobile market sales, the number of automobile exports is a wind vane to measure the maturity of the development of a regional automobile market. In the past 2023, China’s automobile exports totaled 4.91 million units, replacing Japan as the world’s top automobile exporter for the first time. Automotive products from China have not only participated in the global industry chain, but also played a more important role in more and more markets.
China Association of Automobile Manufacturers released data at the same time show that in 2023 China’s automobile production and sales for the first time at the same time on the 30 million stage, China has become the world’s largest automobile producer, consumer countries, exporting countries. At the same time, the production and sales of new energy vehicles exceeded 9 million, ranking first in the world for nine consecutive years. Such a bright report card is enough to highlight the abundant momentum and strong vitality of China’s automobile industry. In March this year, China held two sessions, a number of car companies on behalf of the proposals and recommendations have focused on new energy, intelligence, sea and other areas.
Today’s Chinese car market is very voluminous, many products are domestic consumption ability to verify and then exported abroad, but also allows some car companies to change the previous strategy of relying on low prices to occupy the foreign market, the realization of the high-end transformation. China’s automobile overseas mode is being optimized, gradually from the early export of products in the trade mode, to a more comprehensive and complex ecological sea change, from the recent update of the overseas plans of several brands can be seen on the obvious difference. For example, Great Wall Motor has announced that it will focus on the localization of production capacity, localization of operations, brand cross-cultural and supply chain security of the new four international, research, production, supply, sales and service to go to sea comprehensively, and plans to achieve overseas sales of more than a million vehicles in 2030, high-end models accounted for more than one-third of the sales ratio. Chery Automobile also said that it will continue to cooperate with global partners in the talent chain, innovation chain, industry chain, supply chain and other value chain to develop cooperation, and global partners to build a new open and innovative ecosystem, and expand the circle of friends for win-win cooperation.
However, China’s auto market still need to think through the expansion of exports to transfer the crisis of the domestic automobile market, both in terms of time and space, are extremely uncertain. 1950s British cars, 1970s Japanese cars, 1990s Korean cars, have staged a similar drama, the end is basically the same. the mid-2000s, the experience of the Chinese automobile manufacturers have proved that The experience of Chinese automobile manufacturers in the mid-2000s has proved that relying entirely on foreign trade cannot support large-scale exports, and there are still many unknown factors.
A big automobile country is not the same as a strong automobile country
Over the past few years, China has seen the new energy vehicle trend and has vigorously developed new energy vehicles, resulting in the rise of many new automobile enterprises. The original automobile enterprises have joined the competitive wave, coupled with China’s leading position in the battery industry, China’s new energy vehicles in the world’s automotive industry has shone. It can be said that China has made the right bet this time.
Over the past many years, China has been relying on imports and domestic assembly of foreign cars to develop the automotive industry, there are always people who think that China’s automobile will never develop, but prejudice can not keep up with the changes in technology and reality, China is actually going to become the world’s largest exporter of automobiles, which is worthy of the Chinese people to be proud of a thing. However, the number of automobiles exported from China is not a condition for being a strong automobile country.
Just as China has the world’s largest sales volume in many industries, it has not become the world’s strongest industrial country. Take cell phones for example, China has the world’s most complete cell phone industrial chain, the highest sales volume, the most sales list of cell phone brands. However, China’s cell phones rely heavily on foreign components and systems, and even Huawei is unable to produce 5G phones under U.S. sanctions. China’s automobile industry is also similar to the cell phone industry, although China has solved a large number of automobile parts, but times are always changing. New technology gives the car more technological content, which also means that there is a need for more technological parts, and these are currently imported by China in large quantities, under these circumstances that China is already a car power and a little early.
There are still a lot of conditions necessary to become an automotive powerhouse. Once automotive powerhouses, such as the United States, Japan, Germany, Korea, in addition to research and development of automobiles, but also in all aspects of the automobile are heavily invested, such as pre-sales service, after-sales service, and China has a greater room for improvement in these areas. Become the largest exporter of automobiles, enough to prove that China’s automobile progress, but the future of China’s development of strong automobile enterprises to the world, to become an automobile power, there is still time. In particular, it is necessary to enhance the ability of independent innovation and establish a strong domestic market to ensure the long-term stability and sustainable progress of the industry.
Safety issues should not be underestimated
With the accelerated popularization of new energy vehicles and the increasing number of ownership, safety issues have become a major concern, especially the spontaneous combustion of new energy vehicles. The safety factor of most new energy vehicle batteries on the market in China is far from adequate, and many products claim to have a safety failure rate of one part in a million, but in reality, it is only one part in ten thousand, or even one part in a thousand. According to the latest data released by the emergency management department statistics show that only in the first quarter of 2023, the spontaneous combustion rate of new energy vehicles rose by 32%, an average of 8 new energy vehicles per day fire (including spontaneous combustion).
Tesla, as a representative company of new energy vehicles, is a bright star in the car market, and its every move has received public attention. Even Tesla has been involved in accidents such as self-driving and fires, not to mention other Chinese new energy vehicle brands whose quality control is far less than that of Tesla. The quality and safety of new energy vehicles are becoming more and more concerned by the society. Currently, EVs are generally shorter in age. Whether in China or Europe and the United States, the average age of fuel vehicles is much higher than that of EVs, and there is even a lack of old vehicles that are more than 10 years old. However, the safety problems of these old cars do not seem to be too serious. In the event of a collision, new energy EVs are prone to catch fire, which is undoubtedly a major safety hazard.
In addition, spontaneous combustion of new energy vehicles is more difficult to extinguish, and its re-ignition rate is high; once a fire breaks out, it leaves less time for the owner to escape. The process of a fuel car fire is basically a slow and gradual process: first smoke, then a burning smell, the owner has time to respond to escape.
However, the spontaneous combustion of new energy vehicles is not only often without warning, but also much faster, and even difficult to leave enough time for passengers to escape. These are the hidden dangers that need to be addressed.
If safety issues are not addressed, the consequences will be “catastrophic”. Competition is important, but consumer safety standards are a red line. Safety is the core of new energy vehicle technology research and development, and only by continuously improving battery safety can we ensure the sustainable development of the new energy vehicle industry.
Charging device will be the biggest test
Early this year, China experienced extremely cold weather, resulting in many electric vehicles being stuck on the highway during long-distance trips without charging, sending out a warning about the acceptance of electric vehicles in Western societies. The rapid growth of the electric vehicle market in recent years is due to the world’s emphasis on environmental protection. However, the establishment of a charging system for long distance travel in western countries will not be completed within a short period of time, which can be said to be a limitation to the development of the EV market, and an obstacle to the sustainable development of China’s EV industry.
In some backward countries, even the highway system and the basic power supply system are still under development, and building a large number of charging devices is even more impossible, so the use of electric vehicles can only be limited to large cities. Moreover, these countries do not have the economic ability to purchase large numbers of electric vehicles, and will at best absorb hybrid vehicles in the foreseeable future. China’s development in this area is not better than other countries, so it can be said that the future development of China’s automobile market will be greatly tested in the future.
Will technological constraints be a problem?
The fastest development of automobile technology in China has been in the past, when China absorbed the technology of Western automobile manufacturing, and imported a large number of major brands of automobiles to set up factories and production in China. This strategy resulted in the emergence of a large number of automotive technicians in China, and pushed up China’s ability to produce its own cars. However, many automobile factories are now withdrawing from China due to the shrinking market, and this advantage is about to disappear.
In addition, the relationship between China and the West is tense, and the West has begun to restrict the export of technology to China, including chips, artificial intelligence and energy technology. Under these restrictions, it is not yet known how many obstacles there will be to the development of China’s electric vehicle industry.
The future is still a question mark
The continued expansion of the new energy vehicle market is undoubtedly one of the major trends in the future development of the automotive industry. As the world’s emphasis on environmental protection and sustainable development continues to grow, the market share of new energy vehicles will continue to grow. It is estimated that by 2024, global sales of new energy vehicles will exceed 20 million units, of which the contribution of the Chinese market is expected to remain at about 60%. This growth trend is due to the dual promotion of technological innovation and policy support. The improvement of battery energy density, range increase and charging facilities will further enhance the market competitiveness of new energy vehicles.
The future development of the automotive industry will be characterized by diversification, high technology and globalization. The development of new energy, intelligent Internet and autonomous driving technologies will reshape the industry pattern and promote the improvement and expansion of the industrial chain. At the same time, internationalization and industry integration will accelerate, pushing the industry to develop in a higher quality and more sustainable direction. In this era full of opportunities and challenges, automobile enterprises need to maintain the momentum of innovation and actively respond to market changes in order to be unbeatable in the future competition.
China’s automobile industry has already spread all over the world and has performed well in many markets, but it still faces some special impacts or risks. Risks include geopolitics, taxation, carbon barriers, differences in technical regulations, certification thresholds and cross-cultural integration. Not long ago, the European Union issued a notice to conduct customs registration of electric vehicles imported from China, and may impose retrospective tariffs on related vehicles in the future, while the United Kingdom and the United States are preparing to conduct counter-subsidy investigations or national security risk investigations on Chinese electric vehicles.
Especially recently, the U.S. peddled the theory of new energy overcapacity, the rise of global trade protectionism, but also to China’s new energy vehicles to the sea formed a considerable challenge. If China wants to become an automotive powerhouse, there are still many obstacles to overcome. Going out is just the first step, and it is still a long way to go to really enter overseas markets, consolidate overseas markets, and win the trust of overseas markets.