China’s love of domestic EVs endangers foreign carmakers, says consultancy AlixPartners

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‘Fast EV adoption has put international marques in jeopardy,’ says AlixPartners’ Stephen Dyer, as local firms enjoy overwhelming advantages

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People look at a Nio ET7 at the Beijing Auto Show in Beijing on May 3, 2024. Photo: AFP

Daniel Renin Shanghai

Published: 6:00am, 11 Jul 2024

International carmakers may be forced to retreat from the mainland China market if they fail to catch up with home-grown competitors in developing smart electric vehicles (EVs) that local consumers crave and can afford, according to a global consultancy.

Indigenous EV brands now enjoy overwhelming advantages over foreign rivals in production efficiency and technological innovation, which translates to products that provide value for money and are thus set to take the lion’s share of the market, AlixPartners said.

“Fast EV adoption has put international marques in jeopardy,” Stephen Dyer, the firm’s Greater China co-leader and head of its Asia automotive practice, said in a media briefing on Wednesday. “The EV penetration rate will surge to 75 per cent, tipping the balance in favour of Chinese companies.”

He did not name any of the international brands that could be forced to exit the world’s largest automotive and EV market.

Chinese electric-car makers from BYD – the world’s largest EV builder – to start-ups like Nio and Xpeng dominate the mainland China market, where sales of battery-powered cars account for 60 per cent of the global total.