In recent years, electric cars have continued to be talked about, and many players have appeared in this market, in particular in China. Indeed, it was enough to visit the Shanghai Salon last week to discover a lot of new products in the Chinese car market, with a large number of mainly electric models from new brands.

While some of these brands were created by well-known automotive groups such as Geely or Chery, others somehow came out of nowhere. According to Brian Gu, head of one of these Chinese EV manufacturers, XPeng, bloodbath can be expected in this market!

Electric car: a particularly limited market

Currently there are almostone hundred car brands in Chinabut only a dozen are exported, especially in Europe: “In 5-10 years it will be a much more concentrated market”Brian Gu recently said Financial Times : “I think the number of players will probably drop to less than 10 on the world stage”.

It a rather pessimistic statement followed by a quite a difficult situation for the Chinese auto industry as a whole, which has not spared XPeng: indeed, the Chinese manufacturer’s sales fell by 50% in the first quarter of 2023, dropping it to 12th place among electric car manufacturers in China.

Like its competitors, XPeng has fallen victim to the market slowdown in China following the end of state aid as well price war in the electric car marketinitiated by Tesla and which exerts considerable pressure on Chinese low-cost manufacturers.

Electric car: a serious challenge

However, according to the chairman of XPeng, Chinese car manufacturers should be able to sell about 3 million copies electric cars every year to have a chance of surviving the next decade.

And for this it is important that Chinese manufacturers have strength export to the world market : “We believe that in this scenario, almost half of the sales should be made outside of China”says Brian Gu.

However, this pessimistic message comes with good news for Chinese manufacturers: EV exports are doing well for China, and China is expected to become the world’s largest vehicle exporter in 2023, overtaking Japan.

If the European market remains fairly open (for now) to foreign imports, the next challenge for Chinese manufacturers will be to conquer the North American market, which will not be an easy task given the current political climate.