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The race to sell electric vehicles is heating up in China, the world’s biggest automobile market. With EVs and other eco-friendly vehicles expected to account for one in every three new car sales in China this year, both local and global automakers are rushing to release new models.

“What moves Chinese customers today will move the world tomorrow,” said Oliver Zipse, chairman of BMW’s board of management, while presenting the i Vision Dee, an electric concept car, at the 20th Auto Shanghai show, which kicked off on Monday, AFP reported.

The BMW executive said the Chinese auto market’s rapid reorganization around EVs will drive changes in the global automobile market.

More than 1,000 exhibitors from around the world — including Hyundai, Kia, BMW, Toyota, Nissan and BYD — are showcasing their latest EV models at the auto show in Shanghai, which runs through April 27.

German automaker Mercedes-Benz unveiled an electric model in its Maybach brand, which is noted for its pricey vehicles.

Japanese automaker Toyota, which has been slower to jump on the electric bandwagon, introduced two new electric models, reported the Nikkei, a Japanese newspaper.

The German automaker Volkswagen has announced plans to invest 1 billion euros in an EV research and development center to be built in Hefei, a city in southern China’s Anhui Province.

Volkswagen showed off 20 EV models at the Auto Shanghai exhibition, including partial EVs. On a visit to China, Volkswagen Group CEO Oliver Blume said the experience was “a bit like coming home.”

The reason the world’s automakers are focusing so much on the Chinese EV market has to do with the rapid shift toward EVs underway in the country, which represents the largest automobile market on the planet.

The China Association of Automobile Manufacturers predicted that new vehicle sales in China this year would be in the range of 27.6 million, an increase of 3% from 2022. It also estimated that around 9 million of them, or nearly 30%, would be EVs or other eco-friendly vehicles.

China has been promoting EV sales since 2009 through subsidy payments and other means. The trend has remained robust even after those payments were discontinued this year, with some Chinese experts predicting eco-friendly models will account for 80% of all new vehicle sales by 2035.

Benefiting from a massive domestic market, Chinese companies have been enjoying rapid growth in the EV field. Four of the top five companies in terms of Chinese EV market share (shipments) last year were Chinese.

In first place was BYD, which shipped over 911,000 vehicles. The only foreign company in the top five was Tesla, which came in second with over 710,000 vehicles shipped. Since January, Tesla has been selling its Model 3 sedan and Model Y sports utility vehicle at prices up to 14% lower than last year in China.

The New York Times reported that as the race has heated up, companies have recently been competing with discounts in the Chinese automobile market.

Some analysts have suggested the reason Chinese companies have performed so much stronger in the EV era than in the internal combustion engine vehicle one is because of their grip on the battery industry, which produces core components.

In terms of battery industry scale, China accounts for 70% of the global market, and with the local supply chains in the country, Chinese EV makers are able to cut costs more easily, the Nikkei observed.

By Cho Ki-weon, staff reporter

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