The Swiss bank said Chinese automakers are likely to overcome hurdles such as an anti-subsidy investigation launched by the European Commission (EC) into the country’s electric vehicle (EV) industry.
UBS analyst Paul Gong said at a press conference on Tuesday that battery-powered vehicles will account for 30% of China’s total car exports this year.
“Chinese electric vehicle manufacturers have a technological advantage,” he said. “In addition to high-performance batteries, they are also familiar with several manufacturing techniques that make the production process simpler and more cost-effective.”
China is already on track to become the world’s largest car exporter in 2023, exporting 4.4 million vehicles in the first 11 months, up 58% from 2022, according to data from the China Automobile Manufacturers Association.
During the same period, Japanese automakers, which will be the world’s top exporter in 2022, sold 3.99 million vehicles overseas, according to data from the Japan Automobile Manufacturers Association.
This is the first time that China, the world’s largest automobile and EV market, has become the number one exporter.
The commission announced in September that it would take up to 13 months to assess whether to impose additional tariffs on Chinese-made EVs. Chinese automakers, which accounted for 8% of the market as of the third quarter of last year, are subject to a 10% tariff.
A critical moment for Chinese EV manufacturers as growth slows and competition intensifies
A critical moment for Chinese EV manufacturers as growth slows and competition intensifies
Gong said Chinese-made EVs like BYD’s Seal vehicle have a cost advantage over Tesla’s Model 3, which is assembled in Europe. He added that in Europe, assembly costs for the Seal vehicle will be 25% lower than the Model 3.
UBS also predicted that Chinese automakers would control 33% of the global market by 2030, almost double the 17% in 2022.
Two out of five new EVs sold in mainland China are equipped with batteries, accounting for approximately 60% of the world total.
In the fourth quarter of 2023, BYD, already the world’s largest producer of electric vehicles (a category that includes plug-in hybrids), surpassed Tesla in pure EV sales.
The Shenzhen-based automaker, backed by Warren Buffett’s Berkshire Hathaway, delivered a record 526,409 all-electric vehicles to buyers from October to December, and 484,507 in the same period. This exceeded Tesla, which delivered about 42,000 units.