In recent years, Chinese automakers have made significant strides on the global stage, gaining prominence in both traditional and electric vehicle markets. Companies such as BYD, Geely, and SAIC have seen substantial growth, with BYD emerged to become the world’s top producer of battery electric vehicles and one the largest OEMs altogether. These companies are not only reshaping their domestic market but also expanding their presence in Europe, S.E. Asia, and other regions. 

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As China’s production capacity far exceeds local demand, these automakers are actively exporting vehicles and forging strategic alliances with Western manufacturers. The rise of Chinese carmakers is also driven by innovations in EV technology, electronics, and software, as well as a world-leading battery supply chain. With strong backing from the Chinese government, these companies are positioning themselves as formidable competitors to legacy global automotive giants in an increasingly electric and tech-driven industry.

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For an earlier take on this topic, read China's Global EV Ambitions — The West Must Act, an article I published in April 2024.

 

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BYD Quickly Climbed to Top Global Ranking

BYD and its wholly-owned brands Denza, Yangwang, and Fangchen Bao have managed an astounding run in the past years, growing from about 35k units a month in the 2020 to over 500k a month at the end of 2024. Last year, BYD sold 4.3 million vehicles, up 41% vs. 2023, which positions the company as the seventh largest OEM by volume.

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The OEM was the global BEV leader in 2024 (while also selling plug-in EVs), ahead of Tesla by just a few thousand units. The two companies each controlled about 16.5% of the global BEV market — selling 1.8m units last year — followed by Geely Holdings at 8.5% (according to Cleantechnica). 

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Considering the larger global plug-in market, BYD had a massive lead in 2024 reaching 25% of global sales according to the same source — and 34% of the Chinese market. The nearest western OEMs are Tesla ranking #2 with a 10% global market share, BMW #5 at 3.1%, and VW Group #7 at 2.6%.

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Furthermore, BYD ranks #2 in EV battery production with 17% of global volumes in 2024, just behind CATL at 38%. This strong position participates in BYD’s deep vertical integration, which also includes motors and power electronics. Talking about tech, BYD recently announced they were deploying Level 2 ADAS across their complete range. Even the entry model Seagull, which sells for less than $10k, will be fitted with 12 cameras and 5 mm-wave radars.

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Not far behind BYD is Geely Holdings, another privately-owned OEM which made its debut on the international scene when it acquired Volvo Cars from Ford in 2010. I suggest reading my article Geely: Creation of a Global Automotive Empire (Dec 2022) for a deep dive into the company. 

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The Geely group has experienced substantial growth to reach 3.4m units in 2024 with multiple brands such as Geely Auto, Polestar, Zeekr, Lynk & Co, Geometry, Radar, Galaxy, London EV Company, or Farizon (commercial vehicles). The company also holds stakes in Mercedes-Benz, Smart, Lotus, Aston Martin, Proton and Volvo Group, and has a broad partnership with Renault (more below).

 

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Emerging Chinese OEMs at the Forefront of Innovation

Dozens of OEMs have emerged over the past decade. A couple of them should be mentioned as they demonstrate the extent to which Chinese OEMs are pushing the boundaries of innovation. 

Founded in 2014, Xpeng started selling cars in 2018 and has since introduced six models. Sales reached 190k units in 2024, including exports to Europe although volume there remain marginal. Even so, Xpeng has reportedly been looking for a site to produce on the continent. The company’s technical capabilities are such that the VW Group is now heavily relying on Xpeng’s electronic architecture and software suite for their future products in China (more below). 

Xiaomi, a major provider of smartphones and other consumer electronics, has successfully done what Apple declined (or failed) to do despite heavy investments. The company launched its first car, the SU7 large sedan, in May 2024. This vehicle is particularly interesting for its impressive vehicle-smartphone integration among other features. By year end, Xiaomi had already sold 135k units, outselling Tesla’s Model 3 in China, and announced a second model, the YU7 SUV. This speed of development and growth is impressive for a company without prior automotive experience.

 

China's Overcapacity Fuels Export Surge

Production capacity in China has boomed in recent years, reaching over 45m units, far exceeding the 31m vehicles sold in 2024. Export is not only an opportunity for Chinese OEMs but clearly a necessity if they are to alleviate the already strong price pressure in their home market. In order to increase capacity utilization, carmakers are aiming at Europe, S.E. Asia, Mexico, Brazil, and even Russia. In 2024, China exported 6m passenger vehicles, twice the volume shipped in 2022. And ambition remains high. BYD is about to launch its fifth car carrier with capacity for 9,200 vehicles.

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Europe represents a major focus for Chinese brands. In 2024, they sold 394k vehicles on the continent, reaching a 3.4% market share. However, the BEV-specific penetration was significantly higher, reaching 11% in Q2. According to Schmidt Automotive Research, 60% of Chinese-branded vehicles sold in Europe currently go to three markets: the UK, Italy and Spain.

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Still, sales in Europe seem to be taking a hit following a steep increase in import duties imposed on Chinese imports starting in October 2024. They now range from 17% for BYD to 38.1% for SAIC (the largest player in Europe with the MG brand), on top of the pre-existing 10%. 

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Consequently, BYD accelerates its localization to circumvent tariffs and announced plans for a third assembly plant in Europe. Based in Hungary, the first one will start shipping cars in 2025. The second, in Turkey, will begin next year whereas the location for the third is yet to be finalized. 

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The USA has virtually closed their market to Chinese-branded vehicles with import duties raised to 102.5% by the Biden administration in 2024. As a result, Chinese OEMs have considered entering the US market via industrial bases in Mexico (or Canada). The only signs of Chinese-branded vehicles in the USA at this point are a couple of Zeekr robotaxis now roaming the streets of San Francisco undergoing tests in Waymo’s fleet. I don’t expect to see other Chinese models in the USA anytime soon.

 

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Western OEMs Leveraging Chinese Players

If you can’t beat them, joint them! Several European OEMs have formed partnership with Chinese players in the past few years.

Back in 2020, Mercedes-Benz sold a 50% stake in Smart to Geely Holdings. As a result, the brand’s products are now developed by Geely on a Geely platform, produced in China, and sold in multiple markets.

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Renault started collaborating with Geely Holdings in 2022 when the latter acquired a 34% stake in Renault Motors Korea, giving the Chinese OEM access to capacity in Asia. Geely since partnered with Renault to jointly own Horse Powertrain, a JV hosting their respective development and manufacturing resources for combustion engines — the two each own 45% and Aramco 10%. Earlier this year, Geely also announced they will invest in Renault do Brasil as a minority shareholder, providing the Chinese with local production and a distribution network. This collaboration has clearly turned global.

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In 2023, VW Group invested $700m for a 5% stake in Xpeng, with plans to build China-bound vehicles on the latter’s existing platform. Last year, the collaboration was expanded to leverage Xpeng’s expertise and jointly develop electronic architectures and SW for the Chinese market. The resulting products are expected to equip VW-branded EVs from 2026.

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Stellantis spent 1.5b€ for a 21% stake in Leapmotor in 2023. Together they set up a JV to handle the latter’s business outside China, Stellantis being the majority stakeholder. The two players quickly proceeded to produce Leapmotor’s T03 small EV in Stellantis’ Polish plant for the European market.

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We should expect more such cross-border collaborations among OEMs, just as they are increasingly being formed between OEMs and Chinese tech companies.