Chinese electric vehicle companies made a significant shift in their investment strategy in 2024, with overseas investments surpassing domestic spending for the first time, reaching $16 billion compared to $15 billion, according to a report by Rhodium Group. This trend marks a pivotal moment in China’s EV industry, signifying a move towards globalization to seek higher returns beyond the saturated domestic market.
The surge in outbound investments by Chinese EV firms reflects the strategic allure of expanding abroad. Nearly 80 percent of prior investments had been concentrated in the domestic market, indicating a notable change in approach. Armand Meyer, a senior research analyst at Rhodium Group, emphasized the competitive landscape in China’s auto market as a driving force behind this shift towards international expansion, as reported by Bloomberg.
In the zero-emission vehicle (ZEV) supply chain, Chinese investments have predominantly focused on battery projects, with a significant share allocated to battery manufacturing. In 2024, battery projects accounted for 69 percent of domestic investment and rose to 74 percent in overseas ventures. Companies like CATL, Envision, and Gotion have expanded abroad early on, setting the stage for further global growth in the sector.
CATL’s establishment of a $2 billion battery plant in Germany in 2018 marked a pivotal move by a Chinese player in the ZEV industry. Subsequently, other major players, including Tesla and BMW suppliers, followed suit, driven by factors like high transport costs and the need for localized supply chains to meet global demand.
Chinese automakers are also ramping up their global presence, with BYD setting up factories in Brazil and Thailand and planning further expansions in Turkey and Indonesia. Chery Automobile has committed to investing $1 billion in an EV plant in Turkey, while Changan Automobile inaugurated its first overseas assembly facility in Thailand, signaling a total investment of approximately $300 million.
The growth of Chinese automakers and parts manufacturers in the new energy vehicle (NEV) sector is accelerating, as highlighted by Cui Dongshu, the secretary-general of the China Passenger Car Association. Cui emphasized the independent ecosystem that the EV battery industry has developed, catering not only to automotive needs but also to energy storage and consumer electronics sectors.
Chinese companies have built a robust upstream ecosystem in key segments like cathode materials, anodes, and electrolytes, giving them a competitive edge in the global market. This drive for growth and innovation has pushed these firms towards overseas investments as a natural extension of their expansion strategies.
Amid global uncertainties, China’s automobile exports surged in the first half of 2025, reaching 3.083 million vehicles, a 10.4 percent increase year-on-year. This growth underscores the rising competitiveness of Chinese cars in the international market, reflecting the industry’s resilience and adaptability in the face of evolving global dynamics.
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