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China considers this year as the crucial year for its new-energy vehicles industry to "go global," according to the Chinese industry ministry.
In a meeting chaired by Chinese Minister of Industry, Xiao Yaqing, Beijing has decided to accelerate innovations and products and standards in its zero-emission vehicles industry to "go global," Reuters reported on Tuesday, quoting a note from the industry ministry posted on its Wechat account.
China is by far the world's largest market for electric vehicles (EVs) and is home to many local zero-emission vehicle makers.
In addition, China dominates the supply chain for critical battery minerals and lithium-ion batteries, which gives it an advantage over other regions in the world in terms of raw materials, input costs, and battery packs.
China leads the world in battery cell manufacturing capacity, according to Morgan Stanley Research and the U.S. Department of Energy cited by Bloomberg.
The Chinese EV market grew at a blistering pace in 2021, with sales soaring by 154 percent despite the global chip shortage and slower conventional car sales worldwide, according to industry analysts at ZoZo Go.
Total EV sales in China surged by 154 percent to 3.3 million last year, ZoZo Go estimates. Carmakers BYD—backed by Warren Buffett—as well as Wuling and Xpeng achieved record-high sales in December.
Moreover, China accounted for more than half of all EVs sold globally in 2021, ZoZo Go says.
This year, robust growth is set to continue because subsidies are no longer a factor, said Michael J. Dunne, CEO at ZoZo Go.
"Until 2020, most EV sales in China were induced via subsidies, rebates and quotas. That era is over. NIO, Xpeng and BYD are building world-class EVs that Chinese buyers are embracing on their own merits. Subsidies are no longer a factor," Dunne wrote earlier this month.
Another reason for strong 2022 sales will be the competition with western manufacturers, he added.
"Chinese EV brands have been taking large chunks of market share from Chevy, Hyundai, PSA and Jeep. The only foreign brand to crack China's Top 10 EV leaderboard is Tesla," Dunne says.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com