After surpassing Japan for the first time in 2023 with 5.221 million vehicles exported, becoming the world's largest automobile exporter, there is no doubt that China will retain the top spot in 2024 with 6.41 million vehicles. Although the biggest competitor has not yet released full-year data, the data for the first 11 months has been far ahead, and China's automobile export advantage continues to expand. If these cars are connected end to end, you can reach from Beijing to Rome.

With the support of new energy vehicles, China's automobile exports have achieved leapfrog development from 1.08 million vehicles in 2020 to 6.41 million vehicles in 2024. Stepping outward, from a major automobile exporter to a strong exporter, from "one car going out" to driving the entire chain "going out", from the open-armed Southeast Asian market to the high-walled European market, Chinese auto companies are accelerating into the offensive and defensive era of "great navigation".

Full-chain overseas expansion

In the global market, most Chinese automakers have already passed the stage of "going overseas" for a single vehicle, and have turned to the coordinated output of technology, capital, talents, and products, integrating into the overseas market system, and realizing localized production locally as the ultimate goal. The diversified overseas expansion model of "one car going overseas drives the whole chain" is accelerating.

In 2024, Chinese automakers' overseas factories will enter a period of rapid landing. On the one hand, relying on a closer geographical location, lower labor costs, and a series of policy dividends such as tax reduction subsidies and tariff exemptions, many automakers have built factories in Thailand. BYD, GAC Aion, Nezha, Great Wall, and Changan have achieved a closed loop from creation, production, and sales in the local market, and production capacity has simultaneously radiated to Southeast Asia and Australia and New Zealand markets;

On the other hand, in the European region, which is more challenging, automakers have begun to cleverly use the power of joint ventures to complete localized production. In April 2024, Chery established a joint venture factory with the Spanish auto company Ebro-EV Motors; with the help of its partnership with Stellantis, Leapmotor has also successfully landed electric vehicles in Europe and started to prepare for the localization of parts production.

At a time when international trade frictions continue, building factories overseas has gradually become a common choice for Chinese automakers to pursue stable and long-term interests overseas.

Due to the entry of new energy, the development history of the automobile industry in the past century has ushered in changes. Chinese automakers standing at the forefront of intelligent electricity are "feeding back" to the global market. Foreign automakers have begun to learn from their former pursuers, and the new joint venture model with technology output as the core has begun to work. Changan and Chery are at the forefront of a new round of technology competition and have begun to empower their joint venture shareholders Mazda and Jaguar Land Rover with their electrification technology. In addition to sales in the Chinese market, they will also gradually move overseas; Xiaopeng and Volkswagen, Leapmotor and Stellantis are all conducting similar reverse technology output cooperation. More international auto giants are turning to electrification, but in fact, their "souls" are given by Chinese automakers. The model of "exchanging money for technology" alternates between independent brands and multinational automakers. Relying on the huge scale of going overseas, the automotive industry chain has begun to move overseas in groups. Led by CATL, many Chinese power battery suppliers have begun to expand in multiple areas. They have not only seized the opportunity to supply international automakers such as BMW and Mercedes-Benz, but also completed in-depth layout locally and accelerated the pace of setting up factories overseas, especially in the European market.

North-South Divide

The strong rise of new energy vehicles has given Chinese automakers more initiative. When "going out" becomes a must-answer question, "where to go" becomes the key to automakers' decision-making.

According to the data from the China Passenger Car Association, the top five countries in my country's total vehicle exports from January to November 2024 are Russia, Mexico, the United Arab Emirates, Belgium, and Saudi Arabia; the countries with the highest total new energy vehicle exports are Belgium, Brazil, the United Kingdom, Thailand, and the Philippines. Overall, there is no obvious change in the fuel vehicle market structure, and China's new energy vehicles, which are "overtaking on the curve", are being treated differently by the global north and south markets.

In markets such as Thailand, Indonesia, and Malaysia, there are few local domestic auto brands. In the era of fuel vehicles, a relatively mature auto industry has not been formed. In the era of new energy, relevant policies such as subsidies are encouraged and supported by the electric vehicle industry, and China's smart electric vehicles are embraced.

In particular, the Thai market, known as the "bridgehead" for China's auto exports, has gradually become a new battlefield for the Sino-Japanese auto battle from the "backyard of Japanese and Korean automakers" in the era of fuel vehicles. In the field of new energy, BYD, GAC Aion, and Nezha have become the main local brands. While the Southeast Asian market is booming, Latin America and South America, including Mexico, Brazil, Argentina, as well as the Middle East and Africa, have low penetration rates of domestic brands and have become key areas for Chinese automakers to compete for layout. BYD, Geely, Xiaopeng, and Weilai are all accelerating their entry into emerging markets and achieving "blossoming" in many ways.

In contrast, the two major regions of North America and Europe are still difficult "hard bones" to chew.

In these two major markets, the automobile industry has a long history of development. In addition to Japanese brands, almost all old car companies such as Volkswagen, BMW, and Ford were born here. In the era of fuel vehicles, these brands not only won the favor of users in the local market, but also took the lead in the global market.

However, the wave of electrification has made Chinese brands stand out and threatened the interests of "defenders". In order to protect local brands, trade protection and tariffs are used to hit electric vehicles produced in China. A towering tariff barrier casts a shadow on the road of Chinese automakers to Europe.

Under the high wall defense, in 2024, some Chinese car companies also postponed their plans to enter the EU in China and continued to "go to Southeast Asia" to deepen their development.

On October 29, 2024, the European Commission announced the end of the anti-subsidy investigation and imposed a final anti-subsidy tax on electric vehicles imported from China for a period of five years. Under this circumstance, the export volume of Chinese car companies to Europe fell in the fourth quarter, the European domestic market also suffered a backlash, and electrification fell into a "puzzle".

The market impact brought about by this was expected, but the "battle for the European market" had to be fought, and Chinese car companies were also actively seeking new ideas for entering the EU.

Under the tariff threshold, the task of building factories in Europe for localized production has become more urgent. In addition to Chery and Leapmotor, which have successfully achieved localized production locally, BYD's European factory is also under construction. Chinese leading car companies including Geely, Weilai, and Xiaopeng also have clear plans to build factories in Europe. 2025 is the first year of the full implementation of the tariff policy. The "headwind" towards Europe, the final outcome is uncertain. Although automakers are determined, the tariff hurdle is still not easy to pass. Opportunities and challenges coexist. Most people in the industry hold a conservative attitude towards this year's automobile exports.