2024 Overview of China’s EVs Industry: Key Trends and Insights

The Chinese automotive market witnessed intense competition throughout 2024, characterized by industry-wide price wars and market saturation. While some manufacturers emerged victorious with remarkable performance metrics, others failed to weather the competitive storm. In the new energy vehicle (NEV) sector, market consolidation accelerated significantly.

As competition intensifies, the race for technology has also evolved, with large language models (LLMs) emerging as a critical differentiator. Manufacturers strategically positioned themselves to leverage autonomous driving advantages. From a global market perspective, despite challenges such as trade barriers, Chinese NEV manufacturers maintained their determination to expand internationally, leading to new market dynamics and developments.

source: Shengma Finance

1. Market Consolidation Accelerates

 
The year's performance metrics revealed stark contrasts among automotive manufacturers.

BYD led the charge with a total of 4.27 million NEVs sold in 2024, a 41.26% increase year-on-year, breaking SAIC's 18-year reign as the top car manufacturer in China. International sales reached 417,200 NEVs, up 71.86% from 2023. BYD retained its position as the top seller in the Chinese market, the top brand in the market, and the global leader in NEV sales, successfully reaching the number one spot globally.

Li Auto reached a milestone of 500,000 annual sales within five years, setting an industry record for the fastest achievement of this benchmark by a luxury automotive brand in the Chinese market. NIO delivered 221,970 new vehicles in 2024, representing a 38.7% year-over-year increase. However, NIO's third-quarter net loss expanded to 5.06 billion yuan.

source: Shengma Finance

Tech giants' automotive ventures garnered significant attention. Xiaomi rapidly gained market share with its inaugural production model, the SU7. CEO Lei Jun announced on social media that SU7 deliveries exceeded 130,000 units in 2024, surpassing annual targets. Their second model, the YU7, is scheduled for market launch between June and July 2025.

XPeng, despite nearly being overtaken by Xiaomi, demonstrated resilience through strong performances of the MONA MO3 and P7+ models. As a part of the “NIO-Xiaomi-Xpeng” group of new forces, their annual deliveries reached 190,068 units, narrowly missing their target range of 200,000-210,000 units.

Leap Motor emerged as a dark horse, achieving its annual sales targets ahead of schedule. December deliveries reached 42,517 units, marking the second consecutive month exceeding 40,000 deliveries and representing a 128% year-over-year increase. Their cumulative 2024 deliveries approached 300,000 units, exceeding annual targets.

However, not all NEV manufacturers were able to thrive in the competitive landscape.

Following the demise of well-known startups like AICHI（爱驰）, WM Motor（威马）and GAH（高合）, JIYUE Auto（极越）, backed by Baidu and Geely, announced its dissolution in December. NETA Auto（哪吒）, the 2022 sales leader among new manufacturers, and GAC-NIO faced significant challenges, with NETA notably ceasing monthly delivery reports.

The process of "survival of the fittest" within China's NEV market has undoubtedly accelerated in 2024.

source: Shengma Finance

2. The Artificial Intelligence Race Intensifies

XPeng's experience demonstrated how advanced driver assistance systems (ADAS) could revitalize sales. Their monthly deliveries doubled from under 10,000 units in early 2024 to 20,000 units in the latter half, largely attributed to their investment in AI large models. On July 30, XPeng launched the AI-powered（天玑）XOS 5.2.0 globally, introducing China's first production-ready end-to-end autonomous driving large model.

The autonomous driving race has also attracted major players including Huawei, NIO, Li Auto, BYD, Changan Auto, Geely, and Great Wall Motor. Beyond enhancing brand value, advanced autonomous capabilities enable premium pricing and create new profit centers.

source: Shengma Finance

Unlike 2023, automakers have expanded their definition of autonomous driving beyond driver assistance systems, with AI large models emerging as the new competitive frontier.

According to Shengma Finance's analysis, the impact of AI large models on the automotive industry extends beyond specific applications like smart cockpits and intelligent driving systems. Instead, they enable general-purpose scenarios that transform vehicles from mere transportation tools into something more comprehensive. In essence, they argue that vehicles equipped with AI large models will possess human-like cognitive and learning capabilities, enabling them to make decisions that balance safety and performance when encountering complex, unknown scenarios during autonomous operation.

Following Tesla's introduction of Transformer+BEV models in 2020, companies like Baidu's Apollo Go, XPeng's Robotaxi, and Tesla's Cybercab have advanced autonomous driving technology.

In late 2024, it was reported that Luofuli, one of the key developers of the DeepSeek-V2 open-source model, would join Xiaomi to lead their AI large model team, signaling Xiaomi's commitment to AI development. After the release of DeepSeek-V2 in May 2024, Luo Fuli publicly stated, "In terms of Chinese language proficiency, the DeepSeek-V2 model is truly at the forefront of both domestic and international closed-source models. Additionally, at just 1 yuan per million input tokens, it’s 1/100th the cost of GPT-4, making it the king of cost-performance ratio." 

XPeng CEO He Xiaopeng suggests that annual sales of 1 million AI-enabled vehicles will become the minimum threshold for market leadership within a decade. AI models might evolve into comprehensive intelligent systems that revolutionize the entire automotive value chain - from research and development through production, supply chain management, sales operations, to after-market services - driving a fundamental upgrade in smart manufacturing capabilities. As this transformation unfolds, industry observers anticipate an even more intense competition among automakers in the year ahead.

source: Shengma Finance

3. Global Market Dynamics

As domestic competition intensifies, Chinese automakers are also making bold moves to expand their presence in international markets.

Despite U.S. and EU tariffs, Chinese automotive exports maintained strong momentum. Through November 2024, cumulative exports reached 5.345 million units (+21.2% YoY), including 1.141 million NEVs (+4.5% YoY).

Chinese manufacturers diversified beyond European markets in 2024. Top 10 export destinations included Russia (957,304 units), Mexico (386,545), UAE (261,615), Belgium (246,896), Brazil (217,591), Saudi Arabia (216,945), UK (166,926), Australia (149,727), Philippines (138,131), and Turkey (114,517).

Brazil emerged as a significant market, with Chinese imports increasing 717% year-over-year in the first half of 2024, accounting for 57.5% of Brazil's total imported passenger vehicles. BYD established three factories in Camaçari, while Great Wall Motor announced a R$10 billion investment plan.

In addition, Uzbekistan has become a new focus for some automakers. In June 2024, BYD’s factory in Uzbekistan officially rolled out its Song PLUS DM-i Champion Edition, and the first phase of production is expected to reach 50,000 units annually. According to customs data, Uzbekistan's NEV imports surged by 5 times in the first ten months of 2023, totaling 22,500 units.

The leading five exporters were Chery (1.144 million units), Changan Auto (530,000), Great Wall (453,000), BYD (417,000), and Geely (403,000). Joint ventures and traditional manufacturers' sub-brands, including Polestar and smart, demonstrated strong international performance.

source: Shengma Finance

Shengma Finance reports mixed results in overseas expansion efforts among China's emerging EV manufacturers in 2024. While XPeng and NIO have made deliberate moves into international markets, particularly focusing on Europe, they face significant technical and regulatory barriers. According to an XPeng insider, the company's products cannot demonstrate their full capabilities in Europe due to regulatory restrictions on software and autonomous driving features. Similarly, NIO faces substantial challenges with its battery swap infrastructure - as NIO President Qin Lihong points out, "Building a single battery swap station in Germany requires 16 months, compared to just 6 months from site selection to completion in China." Moreover, these emerging manufacturers, lacking the established financial foundations of joint-venture companies, face heightened challenges in their international market expansion efforts.

Nevertheless, despite current international trade barriers, Chinese automakers maintain their twin ambitions of "going global" and "moving upmarket." In the face of these challenges, Chinese automotive manufacturers continue to forge new pathways for international expansion.