China Set to Export 4.4 Million Vehicles in 2023, Over 30% Expected to be New Energy Vehicles

NIO ET 5 Touring. Credit: NIO

Market research firm Canalys released a report today projecting that China’s total vehicle exports will reach 4.4 million units in 2023, with new energy vehicles (NEVs) accounting for more than 30% of the total. This growth in China’s auto exports has been steadily increasing since 2020, surpassing Germany last year to become the world’s second-largest exporter. Notably, China overtook Japan in the first quarter of this year to claim the title of the world’s largest auto exporter, driven mainly by the surge in NEV exports.

According to the China Passenger Car Association (CPCA), China’s vehicle exports in April experienced a remarkable increase of 142.40% to 424,200 units, marking a 9.61% rise from March. CPCA data for January to April shows that China’s auto exports amounted to 1.49 million units, a significant 71% increase compared to the same period last year.

The report highlights a shift in China’s core auto export destinations from Africa, Central Asia, and South Asia to more developed regions, such as Europe and Southeast Asia. Canalys points out that China’s light vehicle exports to Europe and Southeast Asia represented 5.9% and 7.6% of the country’s total vehicle exports in 2020, respectively. However, these shares rose to 22% and 14.3% in 2022, indicating a growing market presence in these regions.

An interesting trend noted by Canalys is the increase in the average selling price of Chinese car exports. In 2021, the average price was RMB 112,000 ($15,670), which rose to RMB 140,000 in 2022, reflecting a growth of over 25%. Notably, in the European market, the average selling price of Chinese automotive exports reached RMB 210,000 in 2022.

Canalys predicts that by 2025, Chinese automotive products will penetrate the Southeast Asian market at a rate of 12.8%, up from 2.6% in 2022. Similarly, in Europe, the penetration of Chinese cars is expected to reach 16.5% by 2025.

The report suggests that the alignment of average selling prices between Chinese automotive exports and mainstream products in Europe, coupled with higher awareness of the NEV market among European consumers, contributes to the growing market share of Chinese vehicles in the region.

Canalys projects that the overall light vehicle market volume in Europe and Southeast Asia will expand to 13.7 million and 3.8 million units, respectively, by 2025, with NEVs accounting for over 40% of the market in Europe.

The disruption caused by the Covid-19 pandemic in 2021 significantly impacted overseas supply chains, contributing to the growth of Chinese vehicle exports. Looking ahead, Canalys believes that the expansion of the overseas NEV market presents new opportunities for China’s automotive industry.

Canalys emphasizes that Chinese automakers hold a first-mover advantage in electrification and vehicle intelligence. With ample production capacity and short delivery times, Chinese brands outpace their international counterparts in the NEV transition and core technology development.

This optimistic outlook for China’s vehicle exports highlights the country’s growing influence in the global automotive industry, driven by its emphasis on NEVs and technological advancements.

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