Chinese automakers are gearing up to export hundreds of thousands of electric vehicles (EVs) worldwide, driving a surge in demand for car-carrying vessels. China is poised to amass the world’s fourth-largest fleet in the coming years, prompting the creation of new trade routes specifically for Chinese cars.
According to data from shipping consultants Veson Nautical, China currently has the world’s eighth-largest shipping fleet with 33 car-carrying ships. This pales in comparison to Japan’s 284 ships, Norway’s 102, South Korea’s 72, and the Isle of Man’s 61. However, the landscape is rapidly changing, with Chinese companies placing orders for 47 ships, accounting for a quarter of all orders globally.
“After this armada has been delivered to China, the Chinese controlled car carrier fleet will jump from the current 2.4% to 8.7%,” noted Veson analyst Andrea de Luca. “We expect to see new trade routes established almost exclusively for Chinese OEMs.”
China has surpassed Japan as the world’s largest auto exporter, with BYD alone exporting over 240,000 vehicles last year, constituting about 8% of its global sales. This year, BYD plans to export up to 400,000 EVs. The company already operates one purpose-built 7,000-EV-capacity ship and plans to add seven more such vessels in two years.
Tesla and Volkswagen have also ramped up exports from China, capitalizing on the country’s cost-efficient supply chain.
While cars are typically transported by sea using roll-on/roll-off (RORO) ships, which allow vehicles to be driven directly on board, these ships have been in short supply in recent years. This shortage, coupled with the retirement of older vessels and reduced new ship orders due to the 2008 financial crisis and the industry’s shift to less-polluting fuels, has driven up costs.
Access to RORO ships has become prohibitively expensive, with charter rates soaring to $115,000 a day, more than seven times higher than in 2019. Consequently, companies have opted to purchase ships themselves.
