Is the Rise of Chinese Electric Vehicles Dominating the Global Market? | Explainer News

Western car makers are facing a formidable challenge from Chinese manufacturers in the electric vehicle (EV) market. Tesla, a prominent player in the Western market, saw a significant drop in sales and share price due to increased competition from Chinese companies like Xiaomi, which recently launched its first EV, the SU7.

Chinese EVs already dominate 60 percent of worldwide sales, with companies like BYD, GAC Aion, and SAIC-GM-Wuling holding top spots in global market share. This surge in Chinese EV popularity is attributed to heavy government subsidies and tax breaks, making Chinese EVs more affordable and competitive.

In response, Western countries are implementing tax credits and tariffs to protect their auto industries. The US has tax credits for EV purchases, while President Biden’s administration is considering increasing import tariffs on Chinese EVs. The European Union is also exploring new tariffs on Chinese car manufacturers.

However, concerns about Chinese technology and national security risks have prompted investigations into the impact of Chinese cars on the US market. President Biden highlighted the potential risks of Chinese connected vehicles collecting sensitive data and posing security threats.

Despite these challenges, the future of EVs looks promising, with advancements in battery technology and decreasing costs of raw materials. India has also seen significant growth in its EV market, indicating a global shift towards environmentally friendly vehicles. As EVs become more popular and environmentally friendly, consumers are increasingly drawn to their benefits over traditional petrol cars.