CNBC examines China’s rapidly growing automotive industry, focusing on its technological advancements, increasing exports, and a lack of interest in American car brands.
BYD, backed by Warren Buffett and recognized as China’s leading car brand, overtook Tesla in Q4 2023 as the world’s top electric vehicle (EV) manufacturer, selling more battery-powered vehicles than its U.S. rival. The company is aggressively expanding globally, exporting over 240,000 cars to 70 countries last year. During Tesla's Q4 earnings call, Elon Musk warned that Chinese automakers could "demolish most other car companies in the world" unless regulators intervene.
Detroit automakers like General Motors reaped huge profits selling cars to Chinese consumers after China opened its auto market to foreign firms in the 1980s. However, those lucrative days appear to be over. Chinese firms have caught up with, and in some cases surpassed, the foreign companies that once taught them the automotive trade. Jeep’s joint venture has already gone bankrupt, and one industry analyst predicts that Ford, GM, and others—such as Hyundai, Kia, and Nissan—could withdraw from the Chinese market within the next five years.
Today, China has the manufacturing capacity to supply half the world’s cars and is setting its sights on the U.S. market. While Chinese-owned brands like Volvo, Polestar, and Lotus are already present in the U.S., no purely Chinese brands have entered the market yet. In May 2024, President Biden imposed
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