New Energy Vehicles (NEVs) in China
- Thread starter supercat
- Start date
@vincent @Blitzo do you think we can have a separate thread on this? And move a few of these posts to that thread?
I think strategic implication comes in 3 places
1) soft power through building local industries in various countries like what they are doing in Brazil, Thailand and Indonesia. That's something that spread Japanese and German influences in the past. I think Chinese automakers at the moment are still very focused domestically, but that will change in the future. BYD needs to not only have PV factories in Thailand and Brazil, but also Indonesia, Philippines, Malaysia, Mexico, Russia, Poland, Hungry and South Africa.
2) Weaken the power of Japan and SK in Asia, but primarily Japan. Real implications in East Asia with a economically weak Japan.
3) Reduced reliance on oil. But they will still be reliant on metals/minerals. Right now, the biggest exporter of iron ore is Australia. That's definition of unreliable partner. This is where Afghanistan could come in with their huge iron/copper/rare earth/lithium deposits. That's one to watch.
One thing to keep in mind is that the strategic and economic dynamics for a mineral like lithium (which is really the only notable component of an LFP battery) is very different from oil. Oil is combusted - once it's used, it's gone. Lithium remains in the battery and can be recycled when the battery reaches the end of its life; what's consumed by the EV is electricity. China's cumulative lithium use will follow an S-curve which will level off once the transportation fleet is fully electrified, as opposed to the curve for oil use which keeps going up without bound.
I think they are going to be higher than 5 million this year. Especially with the recent auto purchase incentives. Byd by itself will probably get to 1.7 to 1.8 million.
Brand plays a big part in how Chinese people buy cars, even oversea Chinese here in North America. Take the new Genesis cars for example, they rival the German counterparts in price and (in my opinion) exceed them in execution in many areas, and they are generally accepted to be equals here in North America. But if you read/watch China-based auto reviewers, they will always question the value in Genesis because it's a Korean brand, despite admitting to how good it is.
In that sense, it's definitely an uphill battle for BYD, but I think creating a new brand to deliver the "premium/luxury" lineup is the right way to go.
There are too many automobile brands in China... As a Chinese, I don't think it is necessary……
I think there will be supply challenges in terms of batteries to get to above 5 million
Just to add, there probably will be a lot of lithium required for grid storage batteries as well.
But yes, from a strategic perspective it will mean an end to Chinese oil/gas/coal imports as electricity will be generated from capital investments in nuclear/wind/solar/hydro.
For reference world wide car sale is 66.7million 2021.