Global EV Supply Chain Restructuring and the Competitiveness of China’s New Energy Industry Chain

Report Depth: Deep Dive Writing Structure: Research Report Structure Style: Research report Date Generated: April 3, 2026 Category: EV

I. Executive Summary

In 2024, global electric vehicle (EV) sales exceeded roughly 17 million units, accounting for more than 20% of global new-car sales and approaching 26% in some estimates. The global EV fleet reached about 58 million vehicles, triple the 2021 level. China, Europe, and the United States together accounted for 95% of global EV sales. Within that landscape, China held an overwhelming lead: it produced more than 70% of the world’s EVs, or roughly 12.4-12.9 million units; sold about 65% of them; and had around 60% of the world’s EVs on the road, or about 36 million vehicles.

Drawing on six data sources, 45 atomic pieces of evidence, and 12 core observations, this report analyzes the restructuring of the global EV supply chain and the competitiveness of China’s new energy industry chain. The key findings are as follows:

1. End-to-end industrial chain control. China not only holds more than 70% of global vehicle manufacturing capacity in the finished-vehicle segment, but has also built vertically integrated control from upstream to downstream in key mineral processing and battery manufacturing, including about 70% of lithium refining, more than 90% of graphite anodes, about 74% of rare-earth processing, around 85% of global battery capacity, about 85% of cathode materials, and more than 90% of anode materials.

2. The cost moat continues to deepen. By the end of 2024, the global average battery pack price had fallen to about $111/kWh, while Chinese LFP battery packs were already at roughly $53/kWh—less than 70% of the widely recognized EV-ICE parity threshold of $80/kWh. China’s battery pack prices fell by about 30% in 2024, far outpacing Europe and the United States at 10-15%. In 2024, two-thirds of EVs sold in China were already priced below comparable internal-combustion vehicles even without subsidies.

3. Trade barriers are forcing a shift in globalization strategy. In response to the EU’s 45.3% anti-subsidy tariff, U.S. tariffs exceeding 100%, and gradually rising import duties in Brazil, Chinese OEMs are moving from an export-led model toward localized overseas production. In 2024, overseas investment by China’s EV industry reached $16 billion, surpassing domestic investment of $15 billion for the first time, while cumulative outbound investment rose to $143 billion. Production capacity in Southeast Asia is expected to triple to 1.2 million units by 2026.

4. The LFP technology pathway is the core barrier underpinning China’s competitiveness. China accounts for nearly 98% of global LFP battery capacity. In 2024, LFP batteries met about 75% of China’s domestic battery demand, and the country continues to widen its technological lead through LMFP and sodium-ion batteries.

5. The global EV market is splitting into three distinct penetration tiers. China surpassed a 50% EV sales share in the second half of 2024 and is expected to reach 80% by 2030. Europe is projected to reach about 60% by 2030, while the United States is expected to be around 20%. Emerging markets are also accelerating, with Thailand jumping from 2% to 13% and Brazil doubling to 6.5%.

II. The Global EV Market Landscape: Tripolar Divergence and the Rise of New Forces

2.1 Sales and Penetration Trends

After growing by roughly 35% year on year in 2023, the global EV market continued expanding by about 25% in 2024, reaching around 17 million units in annual sales. In the first quarter of 2025, global EV sales exceeded 4 million, up 35% year on year, and full-year sales are expected to top 20 million. The global EV fleet grew from roughly 20 million vehicles in 2021 to about 58 million by the end of 2024.

Even so, EVs still account for only about 4.5% of the world’s total vehicle parc of 1.6 billion units, leaving substantial room for future growth.

The number of EV models worldwide reached about 785 in 2024, up 15% year on year. In China, the number of EV models has already surpassed the combined total of gasoline and hybrid models. By 2027, the gap between the number of EV models and internal-combustion models is expected to narrow to roughly 30%.

2.2 The China-Europe-U.S. Triangular Market

China, Europe, and the United States account for 95% of global EV sales, but the three markets are at very different stages and moving in very different directions:

China: In 2024, new energy vehicle (NEV) production reached 12.89 million units, accounting for 41.2% of total vehicle production, while domestic NEV sales reached 12.87 million units, or 40.9% of total vehicle sales. In the second half of 2024, China crossed the milestone of EVs accounting for more than 50% of vehicle sales. Under current policies in the IEA’s Stated Policies Scenario (STEPS), around 80% of car and light truck sales in China are expected to be electric by 2030. Battery electric vehicles (BEVs) account for roughly 60% of China’s EV sales, with plug-in hybrids (PHEVs) and extended-range EVs (EREVs) making up the remaining 40%.

Europe: EV sales growth stalled in 2024, largely due to subsidy cuts and a shortage of affordable models. European EV production stood at around 2.4 million units, roughly flat year on year and more than 5% above domestic sales. Regulatory flexibility granted to OEMs now allows them to average a 15% emissions reduction over 2025-2027 rather than meeting the target in 2025 alone. Europe’s EV sales share is expected to exceed 55% by 2030.

United States: EVs accounted for about 10% of U.S. vehicle sales in 2024, and the market is expected to grow by around 10% again in 2025. Notably, about 40% of EVs sold in the United States in 2024 were imported, totaling more than 600,000 units. At the same time, policy uncertainty remains significant: a new 25% tariff on automobiles was added in March 2025, and the future of IRA subsidies remains unclear.

2.3 Acceleration in Emerging Markets

Beyond the three core markets, EV adoption is beginning to accelerate quickly across emerging economies:

• Thailand: EV sales share surged from 2% in 2022 to 13% in 2024

• Brazil: EV sales doubled in 2024 to around 125,000 units, equal to a 6.5% market share

• Costa Rica: about 15%; Uruguay: about 13%; Colombia: about 7.5%

• Africa: EV sales doubled to roughly 11,000 units, still a small base but with notable momentum

• Indonesia and Vietnam: EV sales rose threefold and nearly twofold, respectively

Across emerging markets as a whole, EV sales grew by more than 60% in 2024, with market share nearly doubling from 2.5% to 4%.

2.4 Signals of Overcapacity

In 2024, global EV production reached roughly 17.3 million units, compared with sales of about 17 million, pointing to emerging overcapacity. Worldwide, there were 1,180 vehicle assembly plants as of October 2025, including 407 in China and 89 in the United States. China’s battery manufacturing capacity has already reached twice domestic demand and about 120% of global demand.

At the same time, 35% year-on-year demand growth in Q1 2025 and expectations of more than 20 million units in annual sales suggest that current overcapacity may reflect a temporary supply-demand mismatch rather than structural oversupply.

III. Upstream Supply Chain: China’s Control Over Key Mineral Processing

3.1 Multiples of Mineral Demand

A mid-sized EV requires about 200 kg of mineral inputs—roughly six times the 30-40 kg required for an internal-combustion vehicle. Copper alone exceeds 80 kg per battery electric vehicle, or about four times the amount used in a conventional car. This structural shift in materials demand is fundamentally reshaping global commodity markets.

3.2 The Global Mining Landscape

Global extraction of critical minerals is highly concentrated in a small number of countries:

3.3 China’s Dominance in Refining

Mining concentration is important, but what truly determines supply chain security is refining and processing. On that front, China’s control far exceeds its share of raw extraction:

• Lithium refining: China controls about 70% of global refining capacity. Much of the spodumene mined in Australia is shipped to China for processing.

• Cobalt refining: China processes around 70% of the world’s cobalt, even though the Democratic Republic of the Congo supplies roughly 74% of raw ore.

• Rare earth processing: China handles 74% of global processing and produces nearly all high-performance NdFeB and SmCo magnets, totaling about 240,000 tons and accounting for 85-90% of global output.

• Graphite processing: China produces about 99% of spherical battery-grade graphite and more than 90% of anode materials.

• Nickel processing: China and Indonesia together refine more than 60% of global nickel supply.

This pattern—mining overseas, refining in China—means that even if other countries expand upstream mining, they will still struggle in the short term to reduce dependence on China’s refining capacity. China has already imposed export controls on graphite and is considering restrictions on exports of critical battery technologies, including LFP cathode production and lithium processing.

3.4 EV Demand Shock for Copper and Aluminum

Copper and aluminum are not active battery materials, but they are used heavily in EVs. Aluminum accounts for more than 15% of EV weight. Mercedes-Benz has already partnered with Norway’s Norsk Hydro to source low-carbon aluminum, claiming a 40% reduction in emissions. This creates potential Carbon Border Adjustment Mechanism (CBAM) pressure on China’s coal-powered aluminum smelting industry, especially as the EU will formally extend CBAM to steel and aluminum in 2026.

IV. Midstream Supply Chain: The Battery Manufacturing Duopoly and Technology Pathways

4.1 A Duopolistic Market Structure

The global EV battery market is highly concentrated:

In the first half of 2025, CATL and BYD together supplied 55.7% of the world’s EV batteries. The top five suppliers controlled more than 70% of global battery shipments, and Chinese companies held three of the top five positions.

China produces around 80% of the world’s battery cells and hosts about 85% of global battery manufacturing capacity. In 2024, China’s battery capacity was already twice the level of domestic demand.

4.2 LFP: China’s Technological Moat

The rise of LFP (lithium iron phosphate) batteries is one of the central pillars of China’s competitiveness in EVs:

Global share: LFP accounted for nearly 50% of the global EV battery market in 2024, up from 38% in 2022.

China’s lead: Around 75% of new EVs in China used LFP batteries in 2024, rising to 80% by year-end. In the United States, LFP’s share remained below 10%, likely constrained by tariffs on Chinese batteries, while adoption in the European Union rose for a second straight year by about 90% to more than 10%. In emerging markets such as Southeast Asia, Brazil, and India, LFP’s share already exceeds 50%.

Effective monopoly: Nearly all LFP batteries sold in Europe and the United States are made in China.

Cost advantage: LFP batteries are about 30% cheaper per kWh than NMC batteries. By the end of 2024, average LFP battery pack prices in China had fallen to roughly $53/kWh, far below the industry’s widely cited parity threshold of $80/kWh. China’s battery pack prices fell by about 30% in 2024, versus just 10-15% in Europe and the United States.

4.3 The Technology Frontier: Sodium-Ion and Solid-State Batteries

Sodium-ion batteries: These are less exposed to lithium price volatility and require no scarce materials such as cobalt or nickel. CATL began mass production of its Naxtra sodium-ion battery in 2025, with an energy density of 175 Wh/kg. In March 2025, Hina Battery unveiled a new generation of sodium-ion cells with improved energy density and faster charging. Typical sodium-ion batteries currently offer 120-160 Wh/kg, with core advantages in cost, cold-weather performance, and resource availability.

Solid-state batteries: QuantumScape, Solid Power, and Toyota are targeting commercialization of all-solid-state batteries in 2027-2028, while leading Chinese firms such as CATL and BYD are aiming for large-scale production around 2030.

LMFP (lithium manganese iron phosphate): By adding manganese to LFP chemistry, LMFP increases energy density by about 15-20% while preserving the low-cost, nickel-free, and cobalt-free advantages of LFP. Both CATL and BYD have already begun early commercial deployment.

4.4 The Path of Battery Cost Decline

Lithium-ion battery pack prices fell by about 90% between 2010 and 2020. Prices rose for the first time in 2022 as lithium costs spiked, climbing from $136/kWh to $154/kWh, but had fallen back to around $111/kWh by 2024. Lithium prices collapsed by more than 70% from the late-2022 peak above $80,000 per ton, reaching roughly $8,300 per ton by mid-2025. Even though demand in 2024 was six times the 2015 level, lithium prices had already retreated to around their 2015 level.

BloombergNEF’s diversified hybrid scenario projects battery costs approaching $70/kWh by 2030, enabling full price parity between EVs and internal-combustion vehicles.

4.5 Outlook for Battery Demand

In 2024, battery demand across the energy sector surpassed the 1 TWh milestone, with EV batteries accounting for more than 950 GWh, up 25% year on year. China’s EV battery demand grew by more than 30%, U.S. demand rose 20%, and the EU market was flat. Global battery manufacturing capacity reached about 1,700 GWh in 2024 and is expected to exceed 3,000 GWh by 2030.

V. Downstream Supply Chain: The Competitiveness of Chinese OEMs and the Reconfiguration of Global Expansion Strategy

5.1 The OEM Competitive Landscape

BYD: In 2024, BYD became the world’s largest EV manufacturer on a BEV-plus-PHEV basis, selling 4.27 million NEVs, up 41% year on year, and capturing an 18% global share. Around 1.76 million of those were BEVs, with the rest being PHEVs. BYD overtook Volkswagen in China in 2023 to become the country’s top-selling auto brand. Its exports rose from 243,000 units in 2023 to 417,000 in 2024. Core models include the Song Plus DM-i and Qin Plus DM-i in PHEVs, and the Dolphin and Seagull in BEVs.

Tesla: Tesla delivered 1.79 million BEVs in 2024, down 1% year on year, but remained the world’s largest pure-play BEV maker. The Model Y, with 1.09 million units sold, was the world’s best-selling vehicle across all powertrains. Even so, Tesla’s global BEV share slipped from 20% in 2021 to about 19% in 2023.

Volkswagen Group: The group delivered 744,800 BEVs in 2024, down 3.4% year on year, accounting for 7% of global BEV sales.

Strategic wavering among legacy OEMs: Ford has dropped its target of selling only electric vehicles in Europe by 2030. Volvo has revised its 2030 all-electric target to allow up to 10% hybrids. GM failed to reach its 2024 goal of selling 200,000 EVs in North America and has also abandoned its target of building capacity for 1 million EVs annually. Among U.S. OEMs, 2030 EV sales targets now range from 70% to below 30%, compared with a lower bound of around 50% just one year earlier.

By contrast, Chinese OEMs increased their share of domestic production from about two-thirds in 2021 to more than 80% in 2024. Industry consolidation is accelerating, with smaller startups exiting and larger players such as BYD, Geely, and SAIC capturing scale advantages.

5.2 From Exports to Overseas Localization: A Strategic Shift

After surging 80% to 1.15 million units in 2023, China’s EV exports reached 1.25 million in 2024, with growth slowing to about 7%. The structure of export destinations also shifted sharply: the EU’s share of the value of China’s EV exports fell from more than 70% in 2021 to about 40% in 2024, while Mexico grew by 370% and Southeast Asia by 10%.

There were also signs of inventory pressure in 2023, when overseas sales lagged exports by 275,000 units. But by 2024, Chinese OEMs accounted for 70% of total exports, up from 55% in 2023, indicating an improvement in export quality and brand control.

Facing steep tariff barriers, Chinese OEMs are accelerating their global manufacturing footprint:

• In 2024, China’s EV industry invested more overseas than at home for the first time, at $16 billion versus $15 billion

• Chinese OEM overseas manufacturing capacity is expected to nearly double to 4.3 million units per year by 2026

• Capacity in Southeast Asia is expected to triple to 1.2 million units, accounting for more than a quarter of total overseas capacity

Key overseas deployments:

• Hungary: $18 billion in Chinese EV investment from 2014 to Q2 2025, making it the world’s second-largest battery producer after China; CATL alone is investing €7.3 billion in a plant in Debrecen

• Indonesia: $22 billion in investment, the world’s largest destination; BYD is investing $1 billion in a plant in West Java, scheduled to begin production in January 2026

• Thailand: BYD is building a plant with 150,000 units of capacity as an export hub for ASEAN and Europe

• Turkey: emerging as China’s strategic bridge into Europe

• Africa: received 75% of China’s overseas raw-material investment in Q2 2024

• Middle East: has accounted for 25% of all new investment since 2024

In 2024, battery manufacturing represented 74% of China’s overseas EV investment. In 2025, BYD commissioned the world’s largest roll-on/roll-off vessel fleet, with total capacity exceeding 30,000 EVs, while COSCO’s automotive shipping division is planning annual handling capacity of 700,000 vehicles.

VI. Trade Barriers and the Restructuring of the Global Supply Chain

6.1 Tariff Regimes in Europe and the United States

European Union: In October 2024, the EU imposed anti-subsidy duties on battery electric vehicles made in China, with rates reaching as high as 45.3%, including the base 10% tariff, for a five-year period. In 2023, the EU imported 438,000 BEVs from China worth €9.7 billion. The EU’s share of the value of China’s EV exports has already fallen from over 70% in 2021 to about 40% in 2024.

United States: Tariffs on Chinese EVs exceeded 100% in 2024, and in March 2025 the United States added a further 25% tariff on automobiles across the board.

Other markets:

• Brazil: imposed a 10% import tariff in 2024, rising to 35% by mid-2026

• Mexico: ended the 15-20% EV tariff exemption for non-FTA countries in 2024

• Canada: also imposed tariffs exceeding 100%

6.2 The EU’s Green Regulatory Framework: Three Layers of Non-Tariff Barriers

The EU is building a non-tariff barrier system that may prove even more consequential than tariffs themselves:

1. Battery Regulation (2023/1542): Starting in February 2027, digital battery passports will become mandatory, along with carbon footprint disclosure and limits on CO2 emissions per kWh. From December 2027, recycling rates must reach at least 90% for cobalt, copper, lead, and nickel, and at least 50% for lithium. By December 2031, those thresholds rise to 95% for cobalt, copper, lead, and nickel, and 80% for lithium.

2. CBAM (Carbon Border Adjustment Mechanism): formally takes effect in 2026 and covers steel and aluminum.

3. CRMA (Critical Raw Materials Act): requires that by 2030, no more than 65% of any critical mineral can be imported from a single country.

These rules will have a structural impact on Chinese EV companies. CATL’s Sichuan plant has already reported 100% hydropower use and zero-carbon certification, while Volvo’s EX90 received the world’s first EV battery passport in June 2024.

6.3 Three Scenarios for 2030

The HKUST Li & Fung Supply Chain Institute outlines three possible global EV supply chain scenarios for 2030:

1. Fragmented Blocs: The EV ecosystem splits into a China-centered network and a U.S.-EU-centered network, resulting in duplicated capacity and higher supply chain costs.

2. Diversified Hybrid: A pragmatic model of interdependence emerges, with multiple regional manufacturing centers, battery costs approaching $70/kWh, and continued cross-border investment.

3. ESG-Driven Localization: Sustainability and carbon footprint performance become central competitive factors.

Current trends point most clearly toward the diversified hybrid scenario. Battery manufacturing represented 74% of China’s overseas EV investment in 2024, Asia has attracted 33% of all new investment since 2024, the Middle East 25%, and Europe’s share has fallen from 41% before 2024. Even so, the risk of a fragmented-blocs outcome remains substantial.

VII. Charging Infrastructure: Global Imbalances and the China Model

7.1 Uneven Global Distribution

In 2024, the number of public charging points worldwide exceeded 5 million, with more than 1.3 million added during the year, up 30% year on year. The number of charging points added in 2024 alone was equivalent to the entire global stock in 2020. Roughly two-thirds of all public charging point growth since 2020 has taken place in China.

Regional distribution:

• China: accounts for about 65% of the world’s charging points, added more than 4.2 million in 2024, and reached a total of 12.8 million by year-end. The vehicle-to-charger ratio is better than 10:1, versus roughly 13:1 in the EU.

• Europe: has more than 1 million public charging points, up 35% year on year. The Netherlands leads with more than 180,000, followed by Germany with 160,000 and France with 155,000.

• United States: has around 200,000 public charging points, up 20% year on year. The NEVI program has allocated $5 billion, but only about $30 million had been spent by the end of 2024.

• Southeast Asia (Indonesia, Thailand, Malaysia, Vietnam): has more than 24,000 charging points, nine times the 2022 level.

• India: added 40,000 public charging points in 2024.

• Brazil: had more than 12,000 public charging points as of December 2024.

7.2 China’s Charging Market: Scale Versus Utilization

China has the world’s largest charging network, but it also faces a structural utilization problem:

Market structure: The top five players control 65-70% of the market. Teld is the largest in public charger count; Star Charge ranks second, with strength in high-power charging and shared private chargers; YKC is third as an aggregation platform; State Grid ranks fourth with dominance in highway service areas; and Xiaoju Charging ranks fifth, leveraging Didi’s traffic base.

Utilization pain point: Average utilization of public charging piles nationwide is only 6-8%, though transport hubs and major cities can exceed 15%. By comparison, utilization of U.S. DC fast chargers rose from 12% to more than 17% in 2024.

Policy transition: China’s charging subsidies have shifted from CapEx-style construction subsidies to OpEx-style subsidies tied to actual electricity delivered, because earlier construction subsidies created large numbers of underused “zombie chargers.” In 2024, policy also moved toward requiring all newly built residential projects to reserve charging installation conditions.

V2G (vehicle-to-grid): In January 2024, China’s National Development and Reform Commission and National Energy Administration issued guidance targeting a standardized V2G framework by 2025. Shenzhen and Shanghai are already running large-scale pilot programs. The industry is moving from simply building charging piles to building dispatchable load.

Ultra-fast charging trend: Huawei and Li Auto are promoting liquid-cooled ultra-fast charging above 480 kW. XPeng and Volkswagen plan to deploy 20,000 ultra-fast chargers across more than 400 Chinese cities, while Beijing aims to build 1,000 ultra-fast charging stations by the end of 2025.

7.3 Germany as a Case Study: High Utilization in a Fragmented Market

According to Germany’s Federal Network Agency (Bundesnetzagentur), as of January 2026 the country had 104,127 registered public charging sites operated by 33,226 different companies. The registered database shows 104,118 valid sites and 33,226 distinct operators, with a vehicle-to-charger ratio of roughly 17:1 to 21:1 and average utilization of 15-20%.

Compared with China’s CR5 concentration of 65-70%, Germany’s 33,000-plus operators indicate an extremely fragmented market. Yet Germany’s utilization rate of 15-20% is well above China’s 6-8%. That contrast reflects differences in market development stage and business model: Germany’s fragmented competition pushes operators to focus more on site efficiency and utilization, while China’s rapid expansion phase has prioritized network coverage and scale.

7.4 The Race in Fast and Ultra-Fast Charging

Global installed fast-charging stock above 22 kW reached 2 million units in 2024, while ultra-fast charging above 150 kW grew by more than 50% and accounted for nearly 10% of all fast chargers. Equipment prices for ultra-fast chargers fell by 20% between 2022 and 2024.

China: The number of fast chargers rose from 1.2 million in 2023 to 1.6 million in 2024, accounting for 80% of global additions. Public charging power capacity per electric light-duty vehicle exceeds 3 kW.

European Union: Ultra-fast chargers exceeded 77,000 in 2024, up 60% year on year. Under AFIR, the TEN-T core network must deploy at least one 150 kW fast-charging station every 60 kilometers, with each site providing at least 400 kW of total output by 2025 and 600 kW by 2027.

United States: The country had about 50,000 fast chargers in 2024, with public charging power capacity of less than 1.5 kW per electric light-duty vehicle. The NACS standard (SAE J3400) was adopted by major OEMs such as Ford and GM in 2024-2025.

VIII. Main Conclusions and Outlook

8.1 Summary of China’s Core Competitive Strengths in the New Energy Industry Chain

Based on cross-analysis across multiple dimensions, the competitiveness of China’s EV industry chain rests on five mutually reinforcing pillars:

1. Upstream resource control: China’s dominance in critical mineral refining—70% of lithium, 70% of cobalt, 74% of rare earths, and 99% of graphite—creates barriers that are extremely difficult to replicate in the near term.

2. Midstream manufacturing scale: China holds 85% of global battery capacity, 80% of battery cell production, 85% of cathode materials, and more than 90% of anode materials.

3. Technology path lock-in: The LFP pathway combines a major cost advantage—$53/kWh versus the $80/kWh parity threshold—with continued innovation in sodium-ion and LMFP technologies.

4. Downstream market pull: Domestic penetration above 50% has generated economies of scale and a steep learning curve.

5. The cost flywheel effect: Battery pack costs are falling by around 30% per year in China, versus just 10-15% in Europe and the United States, and the gap is widening rather than narrowing.

8.2 The Direction of Global Supply Chain Restructuring

The global EV supply chain is shifting from a model of “made in China, exported worldwide” toward one of “multi-regional manufacturing and regional self-sufficiency”:

• Chinese OEM overseas capacity is expected to reach 4.3 million units per year by 2026, rising sharply from less than 2% of their current global output

• Southeast Asia is becoming the largest concentration of overseas capacity at 1.2 million units, followed by Europe, centered on Hungary’s battery cluster, and Latin America, particularly Mexico and Brazil

• Battery manufacturing remains the core of overseas investment, accounting for 74%

• Raw-material investment is tilting toward Africa and the Middle East

8.3 Risks and Challenges

1. Trade policy uncertainty: New U.S. tariffs, Europe’s political cycle, and Brazil’s tariff trajectory could all alter the pace of supply chain reconfiguration.

2. Overcapacity risk: China’s battery capacity is already twice domestic demand, and any slowdown in global growth could trigger an intensified price war.

3. Technology substitution risk: If Japan, Europe, or the United States commercializes solid-state batteries ahead of China, the country’s current LFP advantage could weaken.

4. ESG compliance costs: The EU battery passport, CBAM, and CRMA will all raise compliance costs for Chinese firms.

5. Overseas localization capability: Chinese OEMs still have limited experience in overseas manufacturing, which currently accounts for less than 2% of global output, while culture, labor, and local supply chain integration remain real challenges.

8.4 Outlook for 2030

Under the IEA’s STEPS scenario, by 2030:

• EVs will account for more than 40% of global new-car sales

• China will reach about 80%, Europe about 60%, and the United States about 20%

• Global battery demand will exceed 3 TWh

• China’s share of global battery capacity will fall from 60% in 2024 to below 50% by 2030

• Emerging markets excluding China will rise from 5% to 10%

China’s new energy industry chain is currently in a globally leading position, but the durability of that advantage will depend on the interaction of three variables: the speed of technological iteration, the evolution of geopolitics, and the ability to meet rising ESG compliance requirements.