How China's carmakers are pushing to the top of the world
German manufacturers still dominate the premium segment. But Chinese makers are catching up at breathtaking speed. A factory visit to Chery.
German manufacturers BMW, Daimler and Audi still dominate the premium segment of the global car market. But Chinese producers are catching up at breathtaking speed. Correspondent Stephan Scheuer was shown the technology at the plant of carmaker Chery.
Background
When this report was made, Chinese car brands were still widely regarded internationally as a marginal presence. Companies such as Geely, BYD, Great Wall and Chery dominated the home market – combining low prices with improving quality – but played almost no role in exports. For western manufacturers China was the crucial growth market, not the competitor.
The turning point came with electric mobility. From around 2015 Beijing placed a massive strategic bet on electric drivetrains: generous purchase subsidies, electric vehicle quotas, investment in charging infrastructure, preferential registration in the largest cities. In parallel, China built an entire supply chain for battery cell chemistry – with CATL and BYD as global market leaders.
Since then China has become the world’s largest car exporter – in 2023 the People’s Republic overtook Japan in that position. In electric vehicles China is the uncontested leader: around 60 per cent of all electric cars sold worldwide are produced in China. BYD – once a pure battery manufacturer – overtook Tesla for the first time as the world’s largest producer of pure electric vehicles in the fourth quarter of 2023.
Several brands are pushing aggressively into Europe. Nio has opened branches in Norway, Germany and other countries; Xpeng and Li Auto followed. BYD has announced a plant in Hungary to avoid tariffs. The established European manufacturers – Volkswagen, BMW, Stellantis – are meanwhile losing market share in China rapidly: their combined share of the Chinese passenger car market has fallen from over 40 per cent in 2020 to under 30 per cent in 2024. VW CEO Oliver Blume described this in that context as a “wake-up call.”
The EU imposed countervailing tariffs of between 7 and 35 per cent on Chinese electric vehicles in October 2024, citing China’s subsidy policy as distorting competition. China responded with countermeasures: tariffs on European pork and spirits imports. The conflict shows how deeply the global car industry has now become the stage for a trade-policy confrontation.
What this 2017 report presents as a future prospect is today’s reality. The question is no longer whether Chinese carmakers will reach world class, but how Europe responds with industrial policy – and whether Germany’s traditional strength with combustion engines can be translated into the world of software-defined electric vehicles.