“NEVs remained the key market driver, with their sales expanding by 113% YoY in April and 43% YTD. In the first four months of this year, NEVs accounted for 30% of PV sales and 26.8% of total LV sales. We expect that NEV sales will surge strongly in Q4 2023 before the expiry of the temporary purchase tax exemption on NEVs at the end of this year,” LMC said.

AutoInformed notes here that the Biden Administration’s Inflation Reduction Act is actual a climate change and industrial policy bill that has global trade implications among US allies, trading partners and hostile states – say Russia and China – that leads to the creation of a new term that will replace “offshoring” in trading and policy jargon with what? How about “friend shoring,” which is starting to emerge in automotive circles.

This leads to LMC’s observation that Chinese exports were still strong in April. PV exports reached 308,000 units in April, increasing by 232% YoY at 17% of total PV production. Total PV export in the YTD 2023 period reached 1,120,000 increasing 113% YoY. Chery, SAIC, Tesla, Geely and Changan are the leading PV exporters.

“Among them, Chery Group accounted for the largest portion at 23% of the total. Chery was followed by SAIC with 16% and Tesla with 12%. New energy vehicles form the core of China’s automotive export growth. Aside from Tesla’s significant exports from China, the brand value of domestic NEV producers has been gradually increasing in the international market. Assuming that political factors don’t negatively influence proceedings, the export volume of Chinese local brands will continue to rise as long as international brands are not able to offer equally competitive products in the same price range,” LMC said.