Will China Continue to Dominate the Electric Vehicle Industry?

China has opened a significant lead as the world’s biggest maker of electric vehicles (EVs). Chinese EV brands account for about half of all EVs sold globally.  Chinese EV makes have succeeded in taking domestic market share from former leaders, such as Volkswagen, and China’s BYD Co (BYDDY) is challenging Tesla (TSLA) as the world’s biggest EV company. In addition to the lower cost and advanced technology of Chinese-made EVs, the country also dominates the EV supply chain in ways that will make it difficult for manufacturers elsewhere to compete.

The world’s largest EV market is China, which continues to grow.  EV sales accounted for a quarter of all new passenger car sales in China in 2022, which rose to 37% in September.  UBS predicts that China’s global EV market share will almost double to 33% by 2030, while Western carmakers will see their share fall to 58% from 81% in 2023.  UBS said China’s BYD Co had a 25% cost advantage over North American and European brands and that Western automakers could continue to lose market share because of the rise of cheaper Chinese EVs.