Only recently, most if not all Chinese auto manufacturers were producing cheaper copies of the European, Japanese and American luxury cars. For instance, CH Auto Lithia Sports is a Chinese sports car that looks like an Audi R8. Similarly, Land Wind X7 looks like a copy of Range Rover. In addition to being copies, they were inferior in quality.
However, a lot has changed in the last couple of years especially in the electric vehicle (EV) segment. Chinese EV manufacturers now account for 50% of the global EV market. Chinese auto manufacturers have improved their EV design and technology. Consequently, Chinese electrical cars are now dominating the competition. Why and how Chinese auto manufacturers are taking over the EV competition? Let’s find out.
Superior Quality EVs
Chinese products were synonymous with inferior quality. A few years ago, there was no competition between a Chinese and a European car. However, now Chinese auto manufacturers are using cutting edge technologies and automated processes to ensure there is no compromise on quality.
The Chinese cars in general and EVs in particular got a makeover due to the ever increasing awareness on global warming. The world’s second largest economy, in order to lessen its carbon footprint, had sold a little less than 3 million EVs in China alone in 2021.
With the European Union aiming to have at least 30 million carbon-free cars in Europe by 2030, China is in the perfect shape to help the Europeans realize this dream. China, after all, exported half a million EVs in 2021, more than any other country.
Developing and mass producing high-quality EVs was a challenge that Chinese auto manufacturers eventually overcame.
Software Intelligence
China is a hub of software development for EVs. According to reports, e-commerce giants like Huawei, Alibaba and Baidu are working as the backbone of the Chinese EV industry. All of this is happening by establishing the basis for research and finding the pain points of customers through data. This data-driven approach has helped Chinese electric car manufacturers to produce premium EVs.
Controlling Global Battery Supply Chain
Did you know, a Chinese manufacturer CATL controls 30% of the world’s battery market.
This is the same company that supplies Cobalt-free Lithium Iron Phosphate (LFP) batteries to Tesla Model 3 and Model Y. In the US, Tesla Model 3 base level sedans are now coming with LFP batteries.
These batteries are believed to be cost effective when compared to conventional lithium ion batteries. China is still the major contributor to the elements required to manufacture these batteries.
Electric cars use Lithium-ion batteries rather than Lead Acid batteries due to their inherent benefits.
You might think the US is the biggest producer of Lithium-ion batteries. In reality, it’s China followed by South Korea and Japan.
Due to this, many renowned Chinese brands are manufacturing EVs due to abundant and cheaper supply of batteries. Some of which are listed below,
- MG
- Cherry
- Xpeng
- Nio
- Zyote
- Shanghai Auto
- Geely
- Beijing Electric Vehicle Corp
- BYD
Dominating the supply chain has put Chinese manufacturers on top of their competitors. This is one of the major reasons why Chinese EVs are taking over the world by storm.
Value for money Electrical Vehicles
Chinese products are believed to be cheaper than their counterparts, which is true. Factors like cheap labor, and low raw material price, help the Chinese mass produce EVs, which are cheaper than their competitors. And this is one of the reasons why they are doing so well in North America, Europe and the rest of the world.
This is despite the tariffs and import duties. For example, Weltmeister EX5 is an EV developed by WM Motor and has a stunning range of 400km on a single charge. However, it costs only $20,000. For comparison, a Tesla Model 3 which costs more than double at $41,940 can only do 429 km apx. on a full charge. This is the definition of being value for money.
Chinese EVs in Pakistan
Electric vehicles are still a new concept in Pakistan. Their acceptability would depend upon their price and for now they are expensive.
Premium EVs like Audi e-tron and MG ZS EV are beyond the reach of a common man. However, this can be changed with the import of cheaper, Chinese EVs.
Recently an MPV – Tourer 250 was officially launched in Pakistan. Nio is also expected to launch its EVs in Pakistan by 2022. BYD is also interested in establishing a manufacturing plant in Pakistan.
However, the government keeps changing its tax regime vis-à-vis these vehicles and therefore, it’s too early to predict the future of EVs in Pakistan. An unpredictable auto policy would discourage many from importing EVs in Pakistan.
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What about the “Made in China” Stigma?
The stigma attached with “Made in China” is pretty much gone, even in Pakistan. Companies like MG, Changan, BAIC, DFSK and others have posted positive sales figures and people seem to have accepted “Made in China” cars in Pakistan. Though these auto manufacturers are not selling EVs in Pakistan, if they were to do so in future, “Made in China” would be no barrier.
This is largely due to their build-quality, safety and comfort features and price. In short, these are value for money rides, loaded with premium features. If these companies keep doing this, we can expect Chinese manufacturers to rule the EV segment in Pakistan.
How do you see the future of EVs in Pakistan? Let us know in the comments section.
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