China’s EVs dominate the world

China makes more than 70% of the world’s electric cars. But it’s hard to find those vehicles in North America. The politicians have managed to shut out cheaper Chinese cars with tariffs, but in the end of the day, the American consumers are paying. The Chinese company BYD Auto was established in January 2003 as a subsidiary of BYD Company, a battery manufacturer, following the acquisition and restructuring of Xi’an Qinchuan Automobile. The first car designed by BYD, the petrol engined BYD F3, began production in 2005. In 2008, BYD launched its first plug-in hybrid electric vehicle, the BYD F3DM, followed by the BYD e6, its first battery electric vehicle, in 2009. Since 2020, BYD Auto has experienced substantial sales growth that is driven by the increasing market share of new energy vehicles in China. The company has aggressively expanded into overseas markets from 2021, mainly to Europe, Southeast Asia, Oceania and the Americas.

Before he opened this year’s United Nations climate summit, Brazilian President Luiz Inacio Lula da Silva helped open a new mega-factory at the site of a former Ford car manufacturing plant. The new plant, in Brazil’s Camacari, Bahia, is one of many being built around the world by BYD, today the world’s largest manufacturer of electric cars. BYD’s presence is also being felt at the ongoing COP30 climate summit in Brazil’s Belem, where it is a cosponsor alongside GWM, another Chinese electric carmaker.

The sponsorship is just one of many ways that China’s investments in green technology are being felt at the UN’s top climate meeting, where the Chinese official delegation of 789 people is second only to Brazil. It is a stark contrast to the United States, whose federal government has not sent an official delegation. California’s Governor Gavin Newsom has accused Trump of handing the future to China and leaving states like California to pick up the slack, in a speech at the summit.

But the UN Climate Change Conference COP30 is not the only event where the diverging paths that China and the U.S. are taking on addressing the climate crisis are being felt. Back in the U.S., and in neighboring Canada, trade barriers aimed at punishing Chinese electric vehicles have made them far costlier than what the manufacturers want to sell them for. These tariffs place North America as an outlier at a time when Chinese EVs otherwise dominate the global market. China has gone from basically not a major player five years ago to becoming the number one exporter of cars globally in terms of the units.

According to the International Energy Agency (IEA), China manufactured 12.4 million electric cars in 2024, more than 70% of the 17.3 million electric cars manufactured globally last year. Of these, China exported about 1.25 million cars, representing 40% of global exports, while the remaining Chinese-made cars, the vast majority, were sold domestically. This dominance has been built on the back of subsidies that China’s put in place to develop its industry, which is a very strategic thing that China has done, both for its own economic growth as well as decarbonization. This is a sounds investment for the future.

But on the streets of the US or Canada, Chinese EVs are still relatively rare due to prohibitive tariffs of 100%, which mean that Chinese EVs are almost impossible to buy in the U.S. and Canada. It means that a car that a Chinese EV manufacturer might be selling at $30,000 actually costs at least $60,000 in the U.S. or Canada. This makes it hard for even cheaper Chinese models to compete with the higher-end US electric models, which on average retail for approximately $55,000. These tariffs, along with other U.S. policies, have meant that Chinese manufacturers have yet to set up shop in the U.S..

The steep tariffs conflict with targets set to transition fully to electric cars by 2035, but are also complicated due to Canada’s close trading ties with the US. The governments are also keeping prices artificially high, negatively impacting consumers.

Chinese exporters, including BYD as well as some smaller firms, are targeting many emerging and developing countries. This is in line with China’s global strategy to expand trade and relationships. As a result, the energy transition is happening much faster in the Global South than in North America. Chinese electric cars have also continued to sell well in many European countries, despite those countries also imposing some tariffs, though lower than the U.S. and Canada.

Still, while BYD has built factories in Japan, Hungary and India, as well as Brazil, its biggest presence remains in China. A majority of the 4.27 million electric cars that BYD sold in 2024 were bought by Chinese consumers. BYD also has a manufacturing presence in Lancaster, California, where it builds electric buses and batteries, but not cars. In China, the local market has grown in part due to incentives from the government, which also saw electric cars as part of its strategy to bring down air pollution in big cities like Beijing and Shanghai. Customers in China have benefitted from the government’s approach, including through access to new technology. For example, a new battery, which BYD announced in March with the promise of charging for 400km (about 250 miles) of travel in just five minutes, is first being made available for preorder to customers in China only.

The IEA has found that prices for electric cars in China are similar to petrol and diesel cars, with half of all electric cars being sold for less than $30,000 and a wide range of lower-priced models available. By contrast, in the U.S. and Europe, the range of available EVs was skewed towards higher-end models with higher prices.

Only one in 10 cars sold in the U.S. in 2024 was electric, while more than half of all new cars sold last year in China were electric. While electric cars grab most headlines on sustainable transport, people are also increasingly turning to electric bicycles, scooters, motorcycles, buses and even trains in many parts of the world. Energy will be in the forefront also in the future and as demand continues to be high or increasing, a non-pollution solution might be possible. China clearly has a more long-term strategic view compared to the short-term American thinking. China also sees subsidies as something positive and as an investment to build a better future, whereas in the West and in particular in the U.S., subsidies are seen as a drain on taxpayers’ money. The EV revolution will continue globally and as in several other areas, the U.S. is on the wrong path, hurting its own consumers, but not investing enough to transition to new energy sources.