09 May 2023Allianz ResearchPhoto by Tom Radetzki on Unsplashto the European The Chinese challenge 19Appendix13Mapping the Chinese challenge for the European automotive industry04Electric vehicles: Reshuffling cards in the global automotive game? automotive industry Allianz Research• The shift to battery electric vehicles is a game changer for the European automotive industry. Alternative energy vehicle sales reached a record-breaking 4.4mn units in 2022, representing 47% of all new vehicle registrations in Europe. Battery electric vehicles (BEVs) led the way, with sales booming by +28%, representing 12% of all new vehicle registrations. With the 2035 phase-out of internal combustion engines (ICE) looming, the automotive sector is on the cusp of a complete shake up, facing a transformation of its supplier base, changing customer needs, competition from new entrants and the reality of a less car-centric society. • But the number one risk is China. Having recognized the potential of electric vehicles 15 years ago, China has since invested vast resources in building a competitive electric vehicle ecosystem. As a result, it now leads the global EV landscape, selling over double the number of BEVs in 2022 compared to Europe and the US combined, while also holding a competitive edge in nearly all aspects of the BEV value chain. Because they account for more than 80% of EV sales in their country, Chinese brands have seen their market shares climb from less than 40% in 2020 to close to 50% in 2022, while the country’s automotive trade balance went from a -USD31bn deficit to a +USD7bn surplus over the same period. At the same time, already in 2022, three of Europe’s best selling BEVs were Chinese impor...
