The European Commission has initiated an \\"anti-subsidy probe\\" targeting Chinese electric vehicles (EVs), raising questions about the future landscape of the automotive industry in Europe.
During her annual address to the EU parliament, Commission President Ursula von der Leyen stated, \\"Global markets are now flooded with cheaper electric cars. And their price is kept artificially low by huge state subsidies.\\" This move, according to experts, could disrupt global supply chains and potentially hinder the long-term growth of Europe's automotive sector.
Contrary to the EU's claims, the rise of Chinese EVs is largely attributed to significant technological innovation rather than excessive state support. Take, for example, China's advancements in battery technology. The Power Swap Station developed by Chinese EV brand NIO enables vehicles to swap fully-charged battery packs in just three minutes, with each station capable of completing 312 swaps daily. Additionally, Contemporary Amperex Technology Co., Ltd. has introduced a new lithium iron phosphate battery that powers automobiles for 400 kilometers with a 10-minute charge time. These innovations highlight China's commitment to advancing EV technology.
Moreover, Chinese EV manufacturers like BYD have streamlined production by domestically producing and assembling most of their auto parts. An assessment by UBS revealed that 75% of a BYD Seal model's components, from batteries to power semiconductors, are made in-house. This vertical integration significantly reduces costs, offering Chinese EVs a competitive edge in pricing without relying on state subsidies. Lower labor costs in China further contribute to making these vehicles more affordable in the European market.
The effectiveness of these strategies is evident in the growing popularity of Chinese EVs in Europe. Statistics from auto consultancy Inovev indicate that 8% of new EVs sold in Europe this year are Chinese, an increase from 6% the previous year. In 2022, nearly half of China's new-energy vehicle exports were directed to the European market, underscoring the region's significant role in China's EV success.
As the EU grapples with these developments, the ongoing probe will likely shape the dynamics of the global electric vehicle market, balancing between fair competition and protecting local industries.
Reference(s):
cgtn.com
