EV growth was once limited by cost and associated infrastructure. Chinese models flooding emerging markets this year tell a different story, and display an important pivot in emphasis.
One of our favorite anecdotes in this year's EM journalism came from Reuters' recent look at the burgeoning growth of Chinese electric vehicles in South America. A Peruvian EV owner got creative with his home's DIY charging infrastructure. Lacking proper grounding for the current, he “grabbed a fork, stuck it into the soil … and the car charged”.
Commentators earlier this year mused - indeed still muse - about the Chinese EV market overcooking itself, with excess supply causing a price war that would undercut margins. Cleary, those comments weren't coming from EM-based markets. Perhaps they were even ignoring the ever-growing presence of Chinese branded EVs on European streets.
Indeed, there was always another option for a glut of Chinese EVs: find paths of least friction and bump their exports.
That concerted effort has centered around EMs, where a combination of efficient shipping routes, more affordable EVs, and growing consumer purchasing power has helped adoption increase. In Latin America, it begins as a Belt-and-Road story, with BRI funding the Chancay Port in Peru that has opened up a fast new channel to moving the cars to the continent.
On a wider basis, however, industry statistics show China's dominance in many other EM-rich regions too. With a few exceptions, where domestic manufacturers reign, China OEMs have cornered the EV market in numerous emerging economies, with its leading brands becoming ubiquitous, and on the back of that foothold, even moving production onshore.
The other half of the story is the demand perspective, though. The fork in the ground. Buying an EV in an emerging market was once a journey: sourcing preferred inventory, of securing financing and any incentives, and perhaps most trickily, figuring out how to charge it in countries that haven't prioritized public infrastructure.
For a variety of reasons, all of those of barriers have begun to fall away - or, in the last case, simply become less important. Private charging setups have become much more common, and improved batteries (even in more affordable models) mean decreased inconvenience and range issues in ownership.
Like the cars themselves, they are becoming commoditized, and home-installed solar-based chargers are being piloted in certain EMs. Indeed, this is the next step for EVs, from China or elsewhere: owning the downstream elements of EV ownership. And with more cars flooding in, it is easy to imagine who has the edge.
