[Asia Economy Reporter Yujin Cho] China is surpassing the traditional home of complete vehicle manufacturing and strengthening its dominance in the global electric vehicle market.
According to major foreign media on the 21st (local time), China's largest electric vehicle company BYD recorded 1.86 million deliveries last year, surpassing Tesla (1.3 million), the 'originator of electric vehicles,' in terms of delivery volume. Citigroup estimated that BYD's deliveries this year would reach 3 million units, double last year's figure, as the company aggressively pursues production and sales.
The market expects the total vehicle deliveries of all Chinese electric vehicle manufacturers, including BYD, to reach 8 to 10 million units this year. This represents overwhelming growth compared to 3.5 million units in 2021 and 6.5 million units last year. In contrast, deliveries in Europe and the United States are expected to remain at 3 million and 2 million units respectively, widening the gap significantly.
Neil Beveridge, an analyst at Bernstein in Hong Kong, estimated that "the growth rate of electric vehicle sales in China this year will reach 35% compared to the previous year," and predicted that if this trend continues, 7 out of 10 electric vehicles sold worldwide this year will be sold in the Chinese market.
The strong performance of Chinese electric vehicle companies has been driven by domestic sales. The market share of local native brands in the Chinese domestic market increased by 3 percentage points to 81% last year, compared to 78% the previous year. This contrasts sharply with 10 years ago when foreign brands from the United States, Germany, and Japan, which dominated internal combustion engine vehicles, swept 70% of the entire Chinese market.
Foreign media reported that Chinese consumers' preference for domestic brands such as BYD, NIO, Xiaopeng, and Li Auto is strengthening, making it even more difficult to stop the dominance of native companies in China, the world's largest electric vehicle market.
According to market research firm LMC Automotive, global electric vehicle sales reached an all-time high last year due to China's strong performance. By region, China accounted for the largest share at 19%, followed by Europe at 11%, widening the gap significantly and ranking second.
Having secured unrivaled dominance in its home market, BYD is now exploring entry into the U.S. market.
According to major foreign media, BYD conducted research on establishing a local distribution network in the U.S. market, in addition to the ongoing European market efforts, through external consulting last year. The Detroit-based consulting firm Urban Science, which conducted this research, reportedly made specific proposals regarding the number of stores needed in each U.S. state and city, as well as the types of stores.
However, sources said, "Due to worsening U.S.-China tensions, rising anti-China sentiment in the U.S., and the Inflation Reduction Act (IRA), the management's final approval has not been obtained, making aggressive expansion unlikely for the time being."
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