China's EV Market Is Imploding
10 days ago
- #Global Trade
- #Electric Vehicles
- #China Economy
- China's EV market is facing serious issues, including the practice of selling 'used' cars that have never been used to inflate sales figures.
- The Chinese government has heavily subsidized the EV industry, investing over $230 billion from 2009 to 2023, leading to overcapacity and intense competition.
- Excessive government intervention and subsidies have created an unsustainable market, with many companies operating at a loss.
- China's EV industry is consolidating, but still has too many players, making profitability difficult due to price wars and slim margins.
- Local governments in China are propping up unprofitable EV companies to save jobs, further distorting the market.
- International markets are responding with high tariffs on Chinese EVs, limiting their global expansion and increasing reliance on government support.
- China's state-led economic model prioritizes global dominance over profitability, which could lead to a financial crisis in the EV sector.
- The global auto industry is becoming a battleground between China's ambitions and other nations' efforts to protect their markets.