The Rise Of Chinese Electric Vehicles And What It Means For The West

In this special episode, we are joined by Lei Xing and Tu Le. Together, they host the China EVs & More Podcast.
We talk about how China has grown exponentially in the recent past, which Chinese automakers are at the forefront of the industry there, and what it means for automakers in the rest of the world.
www.chinaevsan...

[@mikethecargeek]

Great guests. Nobody knows the Chinese NEV Market better 👍🏼

[@buddy1155]

True, but they don't understand at least the European market. It is the same with Japanese and Korean cars. They really got stuck with about 10% of the market share for a long while, just a small percentage of people who wanted the cheapest car. It took them ages to figure out that European are not only brand loyal but also dealer loyal (I don't think US customers are dealer loyal). Many Europeans live in small towns and know their dealer personal and they stick with them for life, only until the local dealers started selling Japanese and Korean cars their market share took off in Europe. But there are already so many brands in Europe today, a dealer that sells several Stellantis brands or brands from the VW-group, Toyota brands or cars from the hyundai/kia are not going to sell Chinese cars as well.

[@futo]

@@buddy1155 but how many Japanese or SKorean brands actually open plants to manufacture within the European (not just EU) market?

[@buddy1155]

@@futo Didn't know they did, but after a short search I found out that Japan and S korea indeed have factories, mainly in eastern Europe. This actually makes sense as South Korean and Japanese labour is expensive. But manufacturing isn't the big issue, it is selling. Europeans have very bad experiences with Chinese products, mobile phones are dirt cheap but they break within two or three year. I still have one of those original Nokia phones, build 25 years ago in Finland... still works fine. Nobody want a car that falls apart in two or three years, no matter how cheap it is.

[@futo]

@@buddy1155 yes, but advancement and quality usually takes a lot of time...not sure if you're old enough to know back when Jap crap was a term in the 60s and the first Hyundai Pony nearly killed of any chance for Skorean in the 80s...same time, by the 80s Japanese brands cars and electronic are a threat to American brands...and by the late 2000s Hyundai/Kia improved vastly, not to mention their electonics exceeded Japanese electronic brands...it's just another cycle happening

[@nc3826]

"Didn't know they did, but after a short search"? So this is all just a amusing YT rabbit hole, but pointless.... Since any new brand entering a new market is going to concentrate... it's an initial marketing and sales strategy in major markets.... And every newly industrialized country built crap before it built quality products.... Have fun pretending China can only build crap, At this point in time.... Lastly the Channel is about how China's EV industry is relevant to the US... Not the rest of the world, who can't spell labor correctly...

[@peterelliott2914]

I'm a fan of subsidies for green tech, not so much putting barriers in the way of it's uptake. Bugger fairness and competition. If the US was serious about saving the planet they'd level the playing field with subsidies of their own.

[@nc3826]

Fascinating topic, but next time. Please discuss all of the technological advantages that China has in the EV space, not just in terms of ADAS. Or at least a few more of them. Spending so much time on Tesla's role (which is debatable), wasted valuable air time.. Good luck having them back and talking about more salient issues. For example China's lead in battery technology, higher powered DCFC and battery swapping. Just to name a few. That the West should be adopting,

[@BatteriesIncludedPodcast]

We hope to have them back. There was a whole discussion about batteries we never really touched on. Perhaps a future episode can focus on batteries.

[@nc3826]

@@BatteriesIncludedPodcast Please try to remember to ask them about their thoughts on battery swapping? During the future episode on batteries. As a subset of how batteries can be utilized. I know the topic is a trigger for some in the West. But its relatively widespread adoption in China, makes it a valid discussion point. Thanks for the feedback.

[@tedspradley]

@@nc3826Thanks for picking up the battery swapping baton. I’ve been banging the drum on it for the last five years like the Aflac Duck. The guys are tired of hearing me say that swapping solves almost all of EV adoption issues. And you are right, battery swapping is a trigger issue for a lot of people. My guess is that U.S. manufacturers aren’t going to know what hit them when consumers start buying Chinese brands when they become available though whatever means like domestic manufacturing.

[@nc3826]

@@tedspradley It's always good to hear from another battery swapping Don Quixote. By the way my interest goes back to the 1970s. And there are numerous examples, such as the UK's EV Milk Floats and even some of the first EVs over 100 years ago utilized battery swapping. I'm not quite as Evangelistic as you are, since like most things in life it has positives and negatives. it just has to play a significant enough role to justify enough battery swapping stations to create a viable battery swapping network. Not every EV should be battery swappable. But pretty much any vehicle that needs to do towing. Should become battery swappable. And it can fill many other niches too. Even BYD is dismissive about battery swapping. It will be interesting to see how it plays out? mmmm duck ;)

[@viplav76]

More than subsidies, it’s more about free market companies competing in and against, essentially a full state.

[@SiuLeung]

Out of spec motoring needs to have a China affiliate to do road trips in different EVs across China.

[@LarryRichelli]

All the tariff is doing is allowing US sold vehicle makes to languish in there development and bringing out newer technology

[@elemenop718]

Great episode. Much better than when that Aussie Tesla hater is on

[@justinschultz4325]

I happily drive a Chinese made 2024 Polestar 2. I know Polestar is looking for other places to produce their EV's due to tariffs. I welcome Chinese EV's coming to USA. I'd happily consider a Zeekr (Polestar Cousin), BYD, NIO, Xpeng, etc.

[@wsi1917]

I think the group gives too much weight to US market where it’s highest risk for any successful Chinese company. US will bank (nation security) when they can’t compete such as Huawei, DJI and Tik Tok. For strong Chinese car company US possibly being put at low priority due to uncontrollable risk from Uni-party regardless of who is president (China batches). Why? Let’s do the math. World about 80 million China 25 US 15, EU + Japan 20 and 20M for the rest of the world. Rest of the world all looking more for affordable car- no national issues. BTW, whole world middle class also looking for affordable car. Japan, No tariff EU about 28-40% which could go away when manufacturing there, (no security BS like US) India big market and also China hater. Outside US & China 40+M, let say 30% No to EV, PHEV, EREV means almost 38M opportunities. Let’s target to take 30% share in 5 years = 11-12M (close to US size) with much less risk. Highest risk car is US car, expensive EV & Hybrid so they will get more impact on reduction of economy of scale before Korean and Japanese. It’s means their cost will get higher and higher and Americans consumers will bare the cost. Chinese EV always can reevaluate US market after 5 years while their brand reputation includes quality and service are fully established. No point to pore billions of $ and being asked to shut down due to national security BS excused. Mexican will enjoy more affordable car and let Americans neighbors unhappy 😂😂😂

[@hankmoody7521]

21:30 "some of these brands will not make it to the US"? Most these brands will be lucky to survive the coming 2-5 years in a tumbling Chinese economy, youth unemployment, new vehicle oversupply and excessive indebtedness of NEV companies. If I'm not mistaken only BYD and Li Auto are in solid waters right now of all NEV companies. Using exports to secure higher margins abroad is not an easy task. Look at companies like Aiways, Voyah (Dongfeng), Hiphi (bankrupt), GWM/Ora (Funky Cat) or Geely brand Lynk & Co, but also Nio or Xpeng - there is no initial and/or lasting success story in Europe. Only well known brands like Smart/Volvo/Polestar (Geely) or MG (SAIC) created a foothold, using local market and customer knowledge as well as a local dealer network. When I hear, car makers from China are years ahead in terms of software, most NEV companies throw their cars on the markts in Europe without any adaption. That's not working. Now bankrupt Hiphi actually wanted to sell cars with a GB/T to CCS adapter in Europe. One note on NEV sales in China, according to gasgoo currently NEV sales can be split up to 60%BEV, 30% PHEVs, 10% range extender, but BEV growth has hit a wall this year, with PHEV+REEVs growing a lot faster and sales in certain car segments more than doubling. So if you hear 50% NEV sales, it's more like 30% BEV sales in China (including A00/A0 mini cars).

[@nc3826]

"some of these brands will not make it to the US" it was a subset of Chinese brands that were referenced.... the discussion was never about "all" the Chinese EV brands.... What is your overall point? That there's a bubble in the Chinese EV market? WADR no duh... But it would have been nice if they would have actually discussed it... And about a dozen other more relevant topics than talking about Tesla...

[@BatteriesIncludedPodcast]

Some good points here. Thanks for sharing your thoughts.

[@leonardowc]

No questions about patents? How they respect patents.

[@garyclark6747]

‘Not because of subsidies’ so the billions dumped in made zero difference. Ok😐

[@conchobar]

There probably isnt a single automotive factory in the US that isnt receiving tax subsidies. Thats just local subsidies. The Deptment of Energy gave out $8bn under Obama specifically for fuel efficient vehicles, from which Tesla got a cut. No one's hands are clean.

[@nc3826]

Apparently we are talking about Norway? and to a lesser extent every developed country.... So of course it all makes a difference.... that difference is A Cleaner World... So what was your point? NVM

[@garyclark6747]

@@nc3826 It was his point, not mine‼️ “It’s something that people that were weren’t able to travel to China and then post Covid in 2023 come to the auto show and basically freak out because they see all these great vehicles and they are great not because of subsidies not because of anything the government did.” 5:22🤦🏻‍♂️🤦🏻🤦🏻‍♀️

[@nc3826]

@@garyclark6747 I finally got your point.... Just to be pointlessly pedantic.... Sorry I assume that comments are intended to add something constructive.... My bad, have a nice day

[@garyclark6747]

There isn’t logic behind that statement was my point. Saying companies receiving subsidies didn’t benefit from them is disingenuous. Certainly money alone can’t make a company succeed in making a “great” product. To say however that subsidies didn’t enter in to the makeup to the success of the product flies in the face of what Tom said of the cost and time involved in bringing an EV from paper to customer delivered product. The billions did have a positive effect on the product. For me the question became why someone would go out of their way to assert an unsubstantiated unprovable improbable inaccuracy.

[@loriallen67]

Great convo guys. One thing… could you put guest name on screen-helpful for those of us with no memory😂

[@BatteriesIncludedPodcast]

Great suggestion, thanks!

[@Bzzap83]

I agree, FYI their names are In the description

[@LemonSanitizer]

"there's never a level playing field and there's never a free market" that quote is powerful and makes me think

[@Per3110]

You need to bring these guys back and talk about all the high-tech EV they have in China, like the Automatic Valet Charging and similar.

[@nc3826]

China is advanced in the EV space, in so many different areas.... Automatic Valet Charging would be the last on my list..... since it seems to be more of a dead end gimmick, relative to inductive charging.... but to each their own.....

[@BatteriesIncludedPodcast]

I think we mentioned the Automatic Valet Charging, but that may have happened in conversation before or after recording. It seems like it's more of an aspiration than feature ready to roll out.

[@Per3110]

@@BatteriesIncludedPodcast My comment was more for a wish to have an episode with a summary of EV tech that exists in China but has not reached other parts of the world.

[@gregkramer5588]

Thanks Tom and Dom for bringing Lei and Tu to the channel!

[@urbanstrencan]

This episode was awesome, really nice inside into the China auto industry, more like it. Here in Europe we already get a lot of Chinese EV brands like MG, BYD, NIO, Xpeng,...

[@ChicagoBob123]

That was an excellant show work great content.

[@malcolmbennett3555]

excellent show guys, really shows how advanced some EV markets are and how far behind many others are. now off to find ttheir podcast.

[@godofdun]

I listen to these guys every week, they're the real deal.

[@EVbeginner]

Super interesting show. Thanks to everyone for sharing.

[@wassimratel2133]

Here's some of the most exciting EVs coming off in Q4: Zeekr Mix, Zeekr CX1E, Galaxy E5, Jiyue 007, ONVO(Nio) L60, Nio ET9, Xpeng Mona 03, Xpeng P7+, BYD Sealion, Denza(BYD) Z9GT, Neta S, Xiaomi SUV, MG Cybergts, ...

[@ericm4840]

Great conversation!

[@GridConnections]

Thanks for having Lei and Tu on! Great resources on not just the Chinese EV market, but EVs at large!

[@DYT-jx4jp]

Doing a group YT video/podcast regularly (mthly, every two mths, or qtrly) similar to this one would be great. Thanks for the effort folks to make this happen!

[@MistSoalar]

13:20 47:10 Tom, you are dealing with companies launching products in 18 month cycle while the rest of the world runs 40+ months. Your 2 weeks notice is like their 1 month advanced notice for them.

[@michaelsmithers4900]

7500 incentive phased out for Tesla in the US starting in 2019. So that wasn’t continuous. There also weren’t very many quality competitors at that time…

[@sirgardensalot]

Special episode nice need more of these 👍👍👍 just watch the video Xpeng's G6 could be a competitor for the model Y in Australia

[@jimparr5412]

Good to see Tom back

[@volvo_kristian]

Really interesting topic 👌 Thanks to everyone

[@davea691]

In the next few years, the Chinese auto companies will continue to rapidly improve their EV batteries and EV cars. This improved auto product will allow them to rapidly expand their sales to the non-USA parts of the world. With the 100 % tariff protection, I predict the big three USA auto companies, will most likely slow down their EV development and therefore in a few years they will only be selling their cars in the USA. And the Mexican market will be filled with Chinese vehicles. Not sure what will be happening in Canada.

[@iggyfan66]

Can you comment on how Ford has created a separate EV division? This seems to be a great idea

[@ferchizzle]

These guys should be on once a week and it would be cool to have them on with Kyle and Paul for the full nerd out session.

[@edmundhayes1840]

Can't see this episode on Spotify

[@rp9674]

So glad to hear someone speak up about L2 charging, especially higher power, the most I've seen is 32 amp shareable. Parts of DC fast charging will always be more expensive and likely more fragile

[@jeffballphoto]

Great podcast and discussion

[@experimental_av]

Their podcast is a must listen. Great guys, great content.

[@sandshark5584]

Any idea why this isn’t on Spotify?

[@BatteriesIncludedPodcast]

We’re right here open.spotify.com/show/5CSylIio4hXF8i1UhMdn9o

[@sandshark5584]

@@BatteriesIncludedPodcast I am subscribed, I was just saying I don’t see this specific episode listed on there.

[@johnpoldo8817]

New Energy Vehicle (NEV), I don’t like this term because it combines conflicting technologies, BEVs + hybrids. You either have an internal combustion engine or not. Closest analogy is half-pregnant. PHEVs are nothing more than an ICE with a small battery. BEVs are totally different because there no engine to service.

[@gbshh9037]

Hybrid is an ICE with an EV back-up. PHEV is an EV with an ICE back-up.

[@bradcooke5383]

The United States is stifling EV adoption with these damn tariffs. Get government out of the way.

[@kng128]

Tariffs are about protecting US jobs and workers. Meanwhile the rest of us a pay higher prices for more limited choices. There might be a national security claim to be made: who's going to build diesel engines for Humvees and other military if Ford and GM go out of business?

[@DYT-jx4jp]

The 0-18 mths dev timeline/cycle I would question in a few ways: - are the vehicles complete (lets make sure we are comparing similarly "finished" vehicles vs released with a bunch of problems, things to finish) - easier to initially have a shorter cycle win no support to an installed base. Once one starts to have to support vehicles for many years, that can change some of the economics. I better metric maybe what is the average dev cycle across a few vehicles/brands that are moving fast. It still maybe like 24 mths :-)

[@xlargetophat]

Trump. Minnesota mining. Tamarack nickel mine. Tesla semi

[@barryw9473]

You guys needed to push more on “not because of govt subsidies”. Tom is always banging on about Chinese govt subsidies. Need to emphasize billions if not trillions from Chinese govt to establish BEV industry. He did mention it a bit but I really think the dollars are the proof.

[@wassimratel2133]

It's called a transition of an industry, Automakers will never be able to make it alone, they need a huge push including subsidies to establish a sustainable supply chain, adding to that the existing of the biggest market and that's how you create champions. Everyone else will compete for the number 2 spot.

[@barryw9473]

Sure. Oil and gas is heavily subsidized in the US, which is why gas cars are so cheap to operate. I am all for govt subsidies of BEV related industries, but the US needs to catch up to match the Chinese assistance.

[@wassimratel2133]

This is why there is the number 2 spot available to grab, because all the factors play in favor of Chinese automakers to be number 1 for a long time in the future.