Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner. Facebook Messenger An icon of the facebook messenger app logo. Facebook An icon of a facebook f logo. Facebook Messenger An icon of the Twitter app logo. LinkedIn An icon of the LinkedIn logo. WhatsApp Messenger An icon of the Whatsapp messenger app logo. Email An icon of an mail envelope. Copy link A decentered black square over a white square.

China consolidates global lead as largest EV market

a Chinese electric car

China continues to dominate the global electric vehicle (EV) market, which was up over 60% in the first half of 2022.

China rebounded as the largest and fastest growing EV market after a brief pandemic-driven pause in 2020, thanks to accelerated car production backed by government tax benefits.

Domestic EV makers bagging the biggest share of the global and Chinese market have emboldened the government’s target for domestic EV sales to 40% by 2030.

While tax benefit abatement may impact sales, government subsidies to China’s EV makers and investor confidence will likely help them maintain their dominant share of the global EV market.

Demand for EVs has continued to grow in 2022, with several new EV models already launched this year. Rising fuel prices have further boosted demand and government incentives help buyers.

Despite market constraints due to the pandemic and growing economic uncertainty, the growth in the EV market shows how rapidly a new technology can become mainstream. While not all EVs run on renewable electricity, the transition to electrification will play a significant role in many countries net zero plans.

China EV market continues to surge ahead

China’s EV sales appear to have shrugged off lockdown and supply chain issues, as car makers accelerate production to take advantage of the government’s tax benefits.

The latest analysis from research group Canalys projects 2022 sales to exceed 5 million units despite a 9-12 month reported delay for battery EVs (BEV), which have outpaced the sale of plug-in hybrids (PHEV) in 2022.

China’s overall automotive sales have also eclipsed that of America and Europe, even though penetration of EV’s is highest in the latter market, led by the Nordics. Chinese EV maker BYD (SZ: 002594) was the market leader, although Tesla dominated the BEV segment.

Raised EV sales goals reflect confidence in domestic market

With 26% of new cars sold in the first half of 2022 in mainland China being EVs, the country has surpassed the ‘Made in China 2025’ target of 20% EV sales, leading the government to increase its mandate to 40% by 2030.

Tax benefits serve not only to spur vehicle sales, but also accelerate production, which is also backed by government subsidies.

Three Chinese EV makers – BYD, SAIC Motor (SS:600104) and Geely (HK:0175) were among the top five in the world, garnering 30% of the global market in the first half of 2021.

Subsidies continue power EV makers as the west watches

Public subsidies for EVs will likely continue to propel domestic car makers for the foreseeable future, or until pressures on local government finances dictate otherwise.

Without official government data on subsidies, and based on disclosures by listed companies SAIC Motor received the largest amount in subsidies in 2021, equal to $598 million, and together with BYD, Great Wall (SS:601633) and Jianghuai Automobile (SS:600418), were among the top 10 subsidy recipients.

Government support of the EV industry also extends to developing battery technology, with BYD and, Contemporary Amperex Technology (SZ:300750), the world’s largest battery maker, receiving related subsidies.

Chinese battery companies also tapped global investors for more than $10 billion, providing a boost to China’s plans to become the global leader in advanced technologies.

China continues to pursue its ambitions to become the dominant technology power in the world, and has even accelerated its efforts. A weakening in regional fiscal conditions could dampen progress, which could be offset by a vast current account surplus and interest from global investors seeking growth amid signs of recession elsewhere.

More from SG Voice

Latest Posts