• About Us
  • Careers
  • Brand Partnerships
TFI Official Merchandise
TFI English
TFI हिन्दी
Wednesday, March 22, 2023
TFIGlobal
TFIGlobal
Right Arm. Round the World. FAST.
No Result
View All Result
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean
TFIGlobal
TFIGlobal
No Result
View All Result

How the RCEP may kill China’s EV industry in stillbirth

Akshay Narang by Akshay Narang
January 2, 2022
in China
Reading Time: 4 mins read
0
Jinping, RCEP, China, EV,
1.4k
VIEWS
Share on FacebookShare on Twitter

It’s the economy stupid! Chinese President Xi Jinping bargained hard to get the Regional Comprehensive Economic Partnership (RCEP) effectuated. But now, the huge free trade deal is killing China’s EV industry. As per the latest reports, China has cancelled the subsidies that fuelled its EV boom, and now the industry is heading towards a catastrophe.

How big is China’s EV industry?

It’s absolutely huge. NIO Ltd, Li Auto and Xpeng Motors are some of the famous names. But there are thousands of small and scattered companies who are trying to make it big in China’s EV industry.

Also Read

Uruguay stepping out of Mercosur?

A malicious attack in CAR, has only one motive

If you count in all new-energy vehicles including hybrids, EVs and hydrogen-powered automobiles, China had a staggering 635 companies in this industry. As per China’s business database Qichacha, the number of Chinese enterprises dealing in “new energy vehicles” went up by 81,000 in 2021 through mid-August.

As of 2019, China’s EV market was estimated to be worth USD 98 billion. 

People in China are going crazy for EVs, and the sale of such vehicles tripled in the first eight months of last year to 1.48 million units. Chinese EV maker BYD is backed by ace American investor Warren Buffet. And even troubled real estate giants like Evergrande had invested in new energy vehicles. It is a different matter that Evergande couldn’t make a single car, just like the many projects that it has failed to complete.

RCEP could kill China’s EV industry

The RCEP has come into force from the first day of this year. It is the largest free trade agreement in the world and covers around 30 per cent of global gross domestic product and 30 per cent of the world’s population. The Chinese State media celebrates it as some sort of a ‘geopolitical win’.

But wait. The RCEP could kill the booming Chinese EV industry. You see, RCEP is a free trade deal. So, it means that the member countries, including China, will have to kill trade obstacles, including unfair subsidies for domestic industries.

Other RCEP countries like Japan are already looking to make inroads into the Chinese EV market. Toyota, the Japanese automobile giant, is planning to launch an impressive, all-electric small sedan in China. With this, it plans to outcompete Chinese EV makers in China.

Why do subsidies matter for China’s EV makers?

Let’s face it- China doesn’t have the advanced technology to match top global companies. Nor do the Chinese EV makers have the kind of reputation that it takes to compete with a brand like Toyota or Japanese automaker Mitsubishi.

In fact, China has an obnoxious automobile industry that copies the West in a an embarrassing manner.

So, how do Chinese people buy Chinese EVs? Well, subsidies. State subsidies gave Chinese EV makers a huge price advantage. Elon Musk came to realise this the hard way, as China is phasing out Tesla by subsidising local EV makers. 

China is now cutting EV subsidies by 20 percent. This is a catastrophe for Chinese EV makers as heavy State subsidies have propelled China into world’s largest EV market that makes up roughly 50 percent of global sales. 

People in China were buying EVs only because they were cheaper. As per China Association of Automobile Manufacturers (CAAM), of the 27.5 million vehicles expected to be sold in 2021, five million would be electric and hybrids. This was, however, an estimate before the start of last year and actual numbers will come out later.

But people in China are no Greta Thunberg fans, and they are unlikely to purchase costlier EVs manufactured by local companies. Chinese people will now either shift to brands like Toyota or simply buy fossil fuel-based, traditional cars. The Chinese EV industry had a decent period, but like all things Chinese, even the EV boom was just a bubble about to burst anytime soon. 

Tags: BeijingCCPChinaChina EVRCEPShort takesXi Jinping
ShareTweetSend
Previous Post

The EU humiliates Joe Biden as it officially embraces nuclear and natural gas resources

Next Post

2022 will be Iran’s year

Also Read

Taiwan coup

China plans a coup in Taiwan!

March 21, 2023
China Europe

US and Europe were happily ever after…until China showed up

March 12, 2023
Sorry, Not Sorry: Trudeau Leaves Canada Without Bullets

Sorry, Not Sorry: Trudeau Leaves Canada Without Bullets

March 9, 2023
Gen. Li Shangfu: Xi hires a new guy to fulfil China’s Space dreams

Gen. Li Shangfu: Xi hires a new guy to fulfil China’s Space dreams

March 3, 2023
Load More

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms of use and Privacy Policy.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

  • Trending
  • Comments
  • Latest
The mysterious death of Shermans has Justin Trudeau written all over it

The mysterious death of Shermans has Justin Trudeau written all over it

March 14, 2023
Africa kicks dollar to the curb

Africa kicks dollar to the curb

March 14, 2023
Did Ukraine use innocent civilians as human shield against Russia in the name of evacuation?

Did Ukraine use innocent civilians as human shield against Russia in the name of evacuation?

May 9, 2022
A ‘unified’ Romania is about to take down NATO!

A ‘unified’ Romania is about to take down NATO!

March 18, 2023
One more African nation Zimbabwe ready to join BRICS

One more African nation Zimbabwe ready to join BRICS

March 17, 2023
Russian Uranium company appeals Namibian government decision

Russian Uranium company appeals Namibian government decision

March 22, 2023
Germany’s Volkswagen loses big against Russia

Germany’s Volkswagen loses big against Russia

March 22, 2023
“To hell with your imperialism” Poland shrugs off EU’s autocratic dream

“To hell with your imperialism” Poland shrugs off EU’s autocratic dream

March 22, 2023
David Cameron’s ‘love at first oink’?

David Cameron’s ‘love at first oink’?

March 22, 2023
Uruguay stepping out of Mercosur?

Uruguay stepping out of Mercosur?

March 22, 2023
Youtube Twitter Facebook
TFIGlobal
  • About us
  • Contact Us
  • Terms of use
  • Privacy Policy

©2023 - TFI MEDIA PRIVATE LIMITED

No Result
View All Result
  • Premium
  • Indo-Pacific
  • Americas
  • Canada
  • Indian Subcontinent
  • West Asia
  • Europe
  • Africa
  • The Caribbean

©2023 - TFI MEDIA PRIVATE LIMITED

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

Follow us on Twitter

and never miss an insightful take by the TFIGlobal team

Follow @tfiglobal
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. View our Privacy and Cookie Policy.