China's EV exports surge while domestic car sales tumble

China has become the world’s largest car exporter, with its electric‑vehicle (EV) industry expanding overseas at a rapid pace. Export growth is driven by manufacturers such as BYD and Chery, which are shifting focus to foreign markets as domestic demand weakens.

At home, sales have fallen after the government cut the subsidy for new car purchases by one‑third and consumers face higher fuel prices and a sluggish job market. The subsidy reduction, combined with a prolonged property downturn, has left many buyers, exemplified by a chef in Henan, postponing vehicle purchases. The slowdown forces Chinese automakers to rely more on exports amid rising trade tensions.

The sector’s rise stems from two decades of state support, massive subsidies and tax benefits, and a manufacturing base that emphasizes rapid production and innovation. Chinese EVs now account for a significant share of new‑car sales in several overseas markets, challenging established producers in Germany, Japan and the United States. The shift has implications for global trade, energy consumption and the strategic balance of the automotive industry.