Electric cars: Manufacturers are beginning to die out in China

According to industry representatives, the prices for electric cars, which are also falling significantly due to the sharp drop in demand, will soon lead to a mass extinction of electric car manufacturers. In China in particular, the number will collapse massively, it is said.

According to a report by Japan Economic Service Nike Asia Chinese car manufacturers warn that the number of manufacturers of so-called “New Energy Vehicles”, i.e. vehicles with electric or at least hybrid drive, in China will fall from around 200 at present to just five to ten within the next few years.

Even well-known brands will have a hard time surviving

The background is the massive price pressure that has arisen due to the sharp drop in demand in connection with lower material costs, especially for batteries. Because suppliers regularly undercut each other with price reductions, customers are also unsure about buying a new vehicle, after all, the price could be significantly lower a month later.

Another factor is foreign automakers such as Volkswagen, BMW and Nissan, all of whom are pushing into the Chinese market with new electric cars, where Chinese manufacturers are currently responsible for nine out of ten sales. The fact that there will soon be significantly fewer manufacturers is also due to the fact that many of the brands that are currently still active were founded in the years 2018 to 2020, when the Chinese government was heavily supporting the market for electric cars. According to analysts, only those manufacturers who have the financial strength to produce their vehicles in huge numbers will survive. In addition, the government phased out subsidies for electric vehicles last year. Currently, demand is at an all-time low, which is why the “elimination” has already begun, according to the boss of EV manufacturer Xpeng.

Ultimately, therefore, only manufacturers with sales of at least three million vehicles per year would be able to survive in the coming years, according to He Xiaopeng, CEO of Xpeng. In ten years there will therefore only be eight mainstream providers, according to his forecast. Xpeng is itself one of the smaller providers, having only delivered around 120,000 e-cars last year. However, thanks to the cooperation with Xiaomi, the brand enjoys a high profile and probably hopes not to be one of the dying providers.

See also:

Xiaomi, Electric Car, Xpeng, Xiaopeng, Xpeng G3
Xiaopeng