Signs of Slowing Domestic Electric Vehicle Growth
Accelerating Overseas Expansion to Southeast Asia
Chinese electric vehicle battery companies are expanding their production bases to Southeast Asia. This appears to be an effort to create opportunities for overseas expansion and market growth amid a slowdown in the Chinese electric vehicle market.
According to the Hong Kong South China Morning Post (SCMP) on the 15th, Chinese electric vehicle battery manufacturer Eve Energy announced to the Shenzhen Stock Exchange that it will invest $422.3 million (approximately 563.5 billion KRW) to establish a cylindrical battery development and manufacturing facility in Kulim, Kedah, Malaysia.
Headquartered in Huizhou, Guangdong Province, southern China, the company explained that this investment is part of globalization and will also benefit shareholders. The batteries produced at this facility will be supplied to electric scooter and electric vehicle manufacturers in Malaysia and other Southeast Asian countries. Eve Energy’s announcement came just two days after the company announced the purchase of a factory site for cylindrical battery production in Debrecen, Hungary.
State-owned power generation and electrical equipment manufacturer Shanghai Electric Group’s electric vehicle battery subsidiary, Anhwa Automotive Engineering, is reportedly planning to establish a battery factory in Chonburi, Thailand, according to recent local Thai media reports. This will be Anhwa’s first production line outside mainland China, with an initial investment estimated at around $7.5 million. The factory will be located near the SAIC Motor-CP plant, a joint venture between China’s largest passenger car manufacturer SAIC Motor and Thailand’s major conglomerate CP Group.
An industry insider told SCMP, "Small electric vehicle manufacturers are also accelerating their overseas expansion as they receive favorable reviews from foreign automakers and consumers," adding, "Now is the right time for overseas expansion as domestic market competition intensifies."
China accounts for 76% of the world’s electric vehicle battery production capacity, and six major Chinese battery manufacturers, including Eve Energy, ranked among the top 10 companies globally by market share in 2022. However, the growth rate of China’s electric vehicle market has recently shown signs of slowing. According to the China Passenger Car Association, sales of pure electric and hybrid vehicles in April totaled 527,000 units, a 3.6% decrease compared to the previous month. This marks the second monthly decline in electric vehicle sales in China since December last year.
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