China’s new energy sector is attracting interest from global investors – Xinhua

BEIJING, May 24 (Xinhua) — U.S. automaker Tesla is the latest multinational company to double down on investment in China’s new energy sector.

On Thursday, the company started construction of a large factory in Shanghai where energy storage batteries will be produced. The move represents a strong vote of confidence in the world’s largest new energy producing country, despite the rhetoric of “decoupling” and “mockery” spread by some US politicians.

In Shanghai, the electric car maker has already launched a gigafactory that will deliver 947,000 vehicles in 2023, an increase of 33 percent compared to the previous year.

Experts say China’s rapidly developing green technologies and booming new energy market have increased the country’s attractiveness to foreign investors, especially auto companies interested in turbocharging the electrification trend.

Last month, BMW announced an additional investment of 20 billion yuan (about $2.8 billion) in its Shenyang production base to facilitate production of its electric-only Neue Klasse range.

According to the German automotive giant, the latest financial initiative signals the company’s “strong commitment to the Chinese market” and “a sign of confidence in its future prospects.”

Also in April, Volkswagen Group announced an investment of 2.5 billion euros (about $2.68 billion) to expand its innovation center in Hefei, the capital of eastern China’s Anhui province, to increase the pace of innovation in China.

The investment will be used to increase innovation and accelerate the production of two intelligent electric vehicles of the Volkswagen brand, which it is working on together with the Chinese manufacturer Xpeng.

According to the German car manufacturer, by 2030 in China alone there will be over 30 fully electric models of all brands of the brand on offer.

“We are fully committed to China. A strong position in China is synonymous with a strong position in the global automotive market,” said Volkswagen Group CEO Oliver Blume, adding that in no other region in the world has the transformation of the automotive industry been as rapid as in China.

Both BMW and Volkswagen reported strong new energy vehicle (NEV) sales in China.

In 2023, BMW delivered nearly 100,000 electric vehicles in China, an increase of more than 138 percent year-on-year. In 2023, Volkswagen delivered approximately 191,800 electric vehicles to the Chinese market, up 23.2% year-on-year.

China is the world’s largest producer and market of NEVs. According to data from the China Association of Automobile Manufacturers, in 2023, NEV production and sales in China exceeded 9.58 million and 9.49 million units, up 35.8% and 37.9% year-on-year, respectively.

“The influx of investment by international automakers has shed light on the global competitiveness of China’s NEV sector, which has established complete industrial and supply chains in recent years,” said Sun Lijian, a professor at Fudan University.

China’s new energy sector has benefited from its technological capabilities, complete industrial chain and huge consumer market, said Li Gang, head of the automotive and traffic engineering college at Liaoning University of Technology.

“China, like many other countries, has introduced policies to address global warming and energy shortages, which have helped create a broad market and huge growth space for the new energy industry,” Li said. ■