According to initial statistics from the China Association of Automobile Manufacturers (CAAM), the country has exported 4.41 million vehicles between January and November of this year, marking a 58% increase compared to the same period in the previous year. This number exceeds the previous leading car exporting country, Japan.
In the first 11 months of 2023, Japan exported 3.99 million cars, showing a 15% increase. It is expected that the total number of cars exported by Japan in 2023 will reach approximately 4.3 million. The last time Japan lost its first place in car exports was in 2016 when Germany surpassed it.
China aims to become a powerhouse in the automotive industry and sees the global shift towards electric vehicles as the path to achieve this goal. The Russian market has become a driving force behind Chinese car exports. The exit of Japanese and Western car manufacturers from Russia has proven beneficial for China.
From January to October 2023, China exported 730,000 cars to Russia, which is seven times more compared to the previous year. Chery and Great Wall Motor mainly export gasoline-powered cars to Russia, including mid-size and large SUVs.
Following Russia, the second-largest and rapidly growing market for Chinese car imports is Mexico, with 330,000 cars, reflecting a 71% increase. Chinese car manufacturers are aiming to establish a customer base in Mexico as a stepping stone for expanding into the US and Canadian markets. Chery, SAIC Motor, and Anhui Jianghuai Automobile (JAC) have all ramped up their production for export to Mexico.
According to CAAM, the export of electric and new energy vehicles from China experienced a 77% increase, amounting to 1.43 million units in the first 10 months of 2023. These eco-friendly vehicles accounted for 34% of the total car exports during the same period.
Most of China’s new energy vehicles are exported to Europe and Southeast Asia. Tesla and BYD, leading electric vehicle manufacturers globally, are currently at the forefront of this export activity.
BYD’s flagship SUV model, the Atto 3, is sold for 38,000 Euros (approximately 42,000 USD) in the European market. This price point is significantly lower than the average price of electric vehicles in the region, which ranges from 50,000 to 60,000 Euros.
Chinese car brands are also expanding their exports to Southeast Asia, where Japanese competitors hold a significant market share. The relatively slow transition to electric vehicles by Japanese car manufacturers has resulted in a decline in their market presence in this region.
From January to October 2023, the number of new energy vehicles exported from China to other Asian markets nearly matched the number of cars exported to Europe. The number of cars exported to Thailand doubled compared to the previous year, surpassing the number of cars exported to the UK.
“From now on, the era of competition with Japanese automakers in the Southeast Asian market will begin,” stated the director of a major state-owned Chinese car company.
Tomoyuki Suzuki, CEO at US consulting firm AlixPartners, believes that the subsidy policy implemented by the Chinese government is the primary factor that gives Chinese car manufacturers a competitive edge in exports. “The substantial government subsidies in China have expanded the production and sales supply chain beyond borders,” concludes Suzuki.
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