Chinese Electric Vehicle Brands Face Intense Competition and High Elimination Rate

TapTechNews July 14th news, Western automakers have been constantly worried about the fast-growing and highly price-aggressive electric vehicle competition from China. But many Chinese electric vehicle brands are also facing the pressure from domestic competition. Experts believe that by 2030, only one-seventh of Chinese electric vehicle brands can achieve profitability.

According to Alixpartners' data, China currently has 137 electric vehicle brands, but the company's analysts believe that only 19 brands will be able to achieve profitability by 2030.

The prediction of such a high elimination rate stems from the continuous and brutal price war in the Chinese domestic market in the past few years, and there is no sign of easing. Dominant companies like BYD have a considerable profit margin and can lower prices again and again, squeezing the living space of competitors with meager profits, and these competitors have no choice but to join the price reduction trend in order to maintain market share.

Alixpartners said that the price war has already cost some Chinese brands dearly, including WM Motor which filed for bankruptcy in 2023. Alixpartners expects more brands to follow suit. According to Bloomberg, analysts predict that unprofitable brands will be forced to completely withdraw from the industry or change strategies to only pursue a small portion of the car market.

At the same time, giants like BYD and Tesla will further consolidate their positions. Last month, experts from Alixpartners said that they expect that by 2030, Chinese automakers will occupy 33% of the global car market share.

TapTechNews noted that the report also disclosed a shocking detail: The auto factory workers of emerging electric vehicle brands work overtime for a maximum of 140 hours per month, which is seven times that of traditional automaker factory workers (up to 20 hours).