In the battle to dominate the electric car market there is currently only one winner: China

The global mobility landscape is changing radically. The era of internal combustion vehicles is coming to an end, giving way to electrification and a new generation of cars that promise a cleaner and more sustainable future. In this race towards electric mobility, China has taken the lead, establishing itself as the undisputed market leader.

The reason for this Chinese dominance is simple: China controls the heart of the electric car: the battery. Two Chinese companies, CATL (Contemporary Amperex Technology Co. Limited) and BYD (Build Your Dreams), dominate the global production of lithium-ion batteries, the technology that powers electric cars. These batteries represent around 40% of the total value of an electric vehicle, making China a critical player in the global supply chain.

The history of this success goes back more than two decades. While the rest of the world looked at electric vehicles with distrust, China opted for their development. The Asian nation, which was suffering from alarming levels of pollution in its large cities, saw electrification as an opportunity to clean the air and improve the quality of life of its citizens.

In the early years of the 21st century, China began investing massively in battery research and development. The production of electric buses and taxis was boosted, creating a domestic market that allowed Chinese companies to gain experience and scale. This national development strategy, which some might call “protectionism,” has been key to China’s success.

Over the years, China has managed to dominate battery production, reducing costs and improving efficiency. Not only have they specialized in manufacturing, but they have also driven innovation in battery technology, allowing them to compete with historical leaders in the sector, such as Panasonic, LG and Samsung.

The Chinese strategy has gone beyond batteries. They have understood that electrification is not only about technology, but also about infrastructure. China has invested heavily in creating a public charging network, encouraging consumer adoption of electric cars.

The result of this strategic vision has been exponential growth in the Chinese electric car market. China currently produces and sells more electric cars than the rest of the world combined, allowing them to control the development of technology and shape the global market.

Chinese companies are not only consolidating in their local market, but are also expanding their influence internationally. They have begun building manufacturing plants in Europe, the United States and other countries, allowing them to access new markets and compete with Western companies.

Importantly, the Chinese government has played a fundamental role in this success, providing incentives and financial support to companies in the sector. However, it is wrong to think that this support is unique. Most developed countries have implemented policies to encourage their automotive industry, including tax incentives for the purchase of electric vehicles and subsidies for research and development.

China has simply been more strategic and for many years has opted for electrification from a global point of view, creating an ecosystem that has allowed it to position itself as an undisputed leader.

The battle for dominance of the electric car market is not limited to technology, but also involves economics, politics and geopolitics. China has demonstrated an exceptional ability to navigate this complex landscape, consolidating itself as a global power in the electric mobility sector.

The future of transportation is electric, and China is prepared to lead this change. Will Western companies be able to regain ground or will they face Chinese hegemony in this mobility sector? The answer will depend on its ability to adapt, innovate and compete in a global market increasingly dominated by China.

You can see a video that I found in VOX magazine that seems fair and clarifying to me: https://youtu.be/rkxMdmipYqM

As I often say, the future remains to be seen.