China's emergence as an EV powerhouse has been a long time coming

Despite being known for its school buses in the US, BYD has become China's largest manufacturer with a market cap of more than $150 billion. While Americans were getting ready for the Fourth of July, Shenzhen-based BYD overtook Palo Alto-basedTesla as the world's most prolific EV manufacturer, selling more than half a million cars in the first half of the next decade.

More than 450 registered EV firms in China are competing for a piece of the world's largest automotive market with future designs for the US and Europe as well. American ingenuity may have initially ushered in the EV era, but it has been China that has put the nation's automakers at the forefront of the global electric vehicle race.

China needs to develop new energy vehicles in order to transform from a big automobile country to a powerful automobile country. To meet the needs of different customers, we should increase research and development, seriously analyze the market, adjust existing policy, and develop new products. This can help the economy. Plug-in electrics, plug-in hybrid, and fuel cell electric vehicles are all eligible for financial subsidies from the government in China.

These efforts can help China meet its Paris Accord carbon neutrality targets of a 20 percent reduction by 2035 and a 100 percent reduction by 2060, both of which are lofty goals. The policies aim to reduce pollution in Chinese cities, reduce the nation's reliance on imported oil, and position China for global leadership in a strategic industry.

Over the past decade, the country's central government has invested heavily to spur growth in the NEV industry. The requirement for EVs to account for 12 percent of production for any company that manufactures or imports more than 30,000 vehicles in China increased from 10 percent the previous year. The government has subsidized EV purchases with more than $14.8 billion since 2009, providing up to $3,600 for battery electric vehicles with more than 400 km range.

Funding and standardization mandates have been provided by the government for China to build out its EV charging infrastructure with a goal of over five million EV charging stalls. preferential parking spots for NEVs are offered by local and municipal governments.

It looks like the plan is working. According to data compiled by the China Passenger Car Association, nearly 15 percent of new vehicle sales were NEVs, which is a record for the year. The Chinese EV market accounted for 53 percent of the global market in the first half of the 21st century. More than 3 million electric vehicles were sold in China last year, compared to just 608,000 in the US. According to the China Passenger Car Association, another 6 million electric vehicles will be sold in the next five years.

According to the Chinese government, the domestic market penetration of electric vehicles will reach 20 percent by 2025. Three in five vehicles on China's roads will be electric by the year 2035, up from one percent in 2019. The market is expected to reach $799 billion in the next ten years.

The premium end of the local market and eventually abroad are being targeted by emerging China EV companies. There is intense domestic competition in the mass market from Leap Motor, Hozon Neta, WM Motor, BYD and numerous sub- brands. Younger entrants are willing to absorb deep losses in order to gain volume share.

The Chinese EV market is dominated by five firms, including BYD, Chery, and GAC. A record 2.2 million vehicles were sold by the various brands of Geely, but the company didn't make the top five. There were 98,155 and 91,429 sales of the brands in the year 2011.

An announcement to phase out limits on foreign ownership of autos was one of a raft of economic reforms announced by the president. The policy for the automotive industry of 1994 banned foreign businesses from owning more than 50 percent of a joint venture with a Chinese firm and from participating in more than two such ventures for any single vehicle type sold in the country. The restriction on ownership share will be removed at the end of the decade.

The regulatory relaxation could have a huge impact on the Chinese EV market, potentially increasing competition for domestic manufacturers from an influx of international manufacturers. Sino Auto points out that the rule change could lead to foreign firms buying out their Chinese partners, though that isn't likely in the immediate future as the existing joint ventures have an average remaining contract length of 19 years. The policy shift will give international firms a better relationship with local Chinese manufacturers.

Local firms will still be able to take advantage of a number of advantages. For one, the cost of transitioning from internal combustion to electric is not a problem for Chinese consumers because they will be the first to use an EV. The local automakers have a better idea of what their customers want and are able to offer it at a variety of trims.

Should they choose to do business in China, international auto companies will need to be careful about freedom and privacy issues. GM and BMW were involved in a dispute over the use of forced labor in the U.S. The Foreign Ministry spokesman said that the report was nothing but ill-intentioned. The US has imposed sanctions on people and companies. The region is home to some of the world's most valuable minerals, including lithium mined from the area.

The Chinese EV market is expected to grow more than 30 percent in the next ten years. Demand is expected to grow due to the government's stringent emissions regulations. According to a recent study, the country may see growth in the adoption of electric buses. In the near future, more than 30 Chinese cities plan to achieve 100 percent electric public transit. The nation's battery production capacity is currently 59 percent of the global market. It is predicted to balloon 7.5 percent by the end of the century.

It may not be long before we see BYD or XPeng brands on American roads, just like they are on the streets of Europe. It is only a matter of time before more Chinese vehicles are sold in the US, according to an analyst.

The internal-combustion engine has been used by Chinese automakers for a long time, so this is an opportunity for them to establish brands in other countries.

Is China able to maintain its pole position? For how long does it take for the likes of GM and Ford to come sniffing around with their huge R&D budgets?