While China’s EV exports surge, Chinese automakers are already making moves to dominate services downstream of the physical vehicle—with implications for national and industrial security. Meanwhile, the G7 celebrates the success of its Russian oil price cap, a looming oil deficit, and a wave of consolidation in energy and mining markets. Plus: nuclear fusion and more firms are betting on national security as a guiding investment thesis.
China’s electric vehicle exports are booming. Last year, its outbound EV shipments more than doubled 2021 levels. New data released this week show the country’s EV exports from January to April nearly doubled year-on-year. By one count, China surpassed reigning champion Japan as the world’s largest auto exporter in the first quarter.
But China’s EV export boom is just one part of the story. The Chinese auto industry’s broader strategy includes dominating the entire suite of automotive mobility technology.
In recent comments to state media, the China Association of Automobile Manufacturers’ deputy chief engineer Xu Haidong said that on the back of an export wave, direct investments overseas are the next major target for Chinese car companies. Greenfield investments in major battery factories in Europe are one example. And those direct investments, Xu has said, should extend beyond the car itself. They should consolidate Chinese automakers’ existing supply chain dominance and extend downstream to cover fields like EV repairs and servicing, second hand markets, recycling, financial services, car insurance, and automotive logistics.
It’s a compelling business case: Leverage your manufacturing capacity and pricing power in EVs and batteries, and create a vast downstream ecosystem within which to lock in customers. That downstream ecosystem and those customers also promise reams of data.
Another key node of the downstream ecosystem is the car operating system. And Chinese state media make clear that Chinese dominance of automotive operating systems is a matter of national security. As Economic Daily put it this week: “The car operating system will decide our victory or defeat in car intelligence and networking…the vehicle operating system not only plays a top-down role, but also concerns national security and industrial security.”
One relevant example is Geely subsidiary London Electric Vehicle Company’s unveiling this month of its modular EV platform, marking the company’s ambitions of becoming a “leading provider of pure electric global mobility solutions.” The Chinese tech outlet 36Kr notes that this is the first time a Chinese carmaker’s advanced automotive infrastructure has “gone abroad.”
“Ten years ago, a shipping container packed and sent overseas supported the ambition of Chinese auto brands to go abroad,” writes 36Kr. “Nowadays, Chinese auto brands are even more eager to sow technology seeds in overseas markets and let them take root locally.”