LChina, which became the world’s leading automobile producer in 2010, mainly built vehicles from foreign brands under license during the era of the thermal engine. For the Chinese authorities, the transition to the era of electric vehicles (EV) must be an opportunity to achieve a strategic ambition: to build a truly Chinese automobile industry, which in turn imposes its brands on the global market.
To do this, the government has not skimped on resources – whether financial or regulatory – and has set about building an enabling environment for the production of electric vehicles.
It did this upstream, ensuring through a short but effective period of protection the emergence of battery manufacturers at the heart of new vehicles. Chinese groups will thus account for 70% of global production of EV batteries in 2023.
Chinese-majority joint ventures
And he did it downstream, by ensuring the construction of a network of 3 million charging stations, or two-thirds of the public terminals installed around the world.
The authorities have also shown themselves determined to push domestic automakers to fulfill the mission assigned to them. EV production quotas – largely exceeded today – were imposed on them. The policy requiring foreign manufacturers to associate with majority Chinese joint ventures, which protected Chinese manufacturers for thirty years, was abandoned in 2018 for the EV segment: it was a question of putting them under pressure from the competition – in this case the American Tesla, which arrived in Shanghai in 2019.
In a China accustomed to following a national strategy, but less monolithic than we sometimes think, the usual mechanisms have been put in place. While the large public banks financed the transition of the country’s “majors” to EVs, the most promising of the myriad start-ups engaged in the sector received the support of regional or municipal authorities wishing to make them their ” local industrial champions.
Overcapacity
On arrival, 32% of vehicles built in China in 2023 are electric, and 70% of electric vehicles produced in the world were produced in China, the majority under Chinese brands.
Has the future of the global electric vehicle market already been written by the steamroller of Chinese industrial strategy? Nothing is less certain, because this strategy will encounter two obstacles which could well cause it to slip.
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