The electric vehicle revolution is in full swing in China, with a significant increase in sales of electric vehicles and a noticeable decline in gasoline-powered cars. The China Association of Automobile Manufacturers reported a 40 per cent surge in electric vehicle sales last year, while gasoline car sales plummeted. Let’s delve deeper into the key points that highlight this shift in the automotive industry:
- Total vehicle sales, including buses and trucks, reached 31.4 million in China last year, marking a 4.5 per cent increase from the previous year. This growth in sales outpaced production, which rose by 3.7 per cent.
- The exports of passenger cars from China saw a substantial increase of almost 20 per cent in 2024, totaling nearly 5 million vehicles. This surge in exports contributed significantly to China’s overall export figures.
- China’s exports of “new energy vehicles,” such as pure battery EVs, fuel-cell cars, and plug-in hybrids, reached 1.28 million units in 2024, showcasing a 6.7 per cent increase from the previous year.
- The Chinese EV market’s expansion overseas has raised concerns among car manufacturers in the US and Europe, leading to the imposition of tariffs on China-made electric cars. The US enforced a 100 per cent tariff on Chinese electric cars, while the European Union introduced new tariffs on Chinese EV makers.
- Domestically, sales of passenger cars in China surged by 13.6 per cent in December, driven partly by incentives for trade-ins. This contributed to a 3.1 per cent increase in overall passenger car sales for the year, totaling 22.6 million vehicles.
- Plug-in hybrids witnessed the most rapid growth in 2024, attracting a new generation of electric vehicle buyers who are either hesitant about pure EVs or seek the extended range that hybrids offer.
- In contrast to China’s booming EV market, the United States and Europe experienced a slowdown in growth, with sales of traditional gasoline and diesel-powered vehicles dropping by 17 per cent in 2024.
The shift towards electric vehicles in China has had a significant impact on the automotive industry, prompting foreign automakers to adapt quickly to the changing landscape. Companies like Volkswagen AG and Nissan Motor Corp. are rushing to develop electric vehicles to cater to the evolving preferences of Chinese consumers. The rise of China’s EV makers is reshaping the global automotive market, making it imperative for traditional automakers to pivot towards sustainable electric mobility solutions.
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