The Development of China’s Automotive Market

The New Strategy in China is "Local for Local”

Over the past few years of pandemic and geopolitical crises, automakers and suppliers have had to manage their global and local supply chains. Today's volatile conditions require a new supplier strategy that relies more and more on consolidated local supply chains: "local for local". This means that suppliers, sourcing, production and sales markets are located close to each other.

The local-for-local approach is economically attractive, especially in light of rising logistics and transportation costs. Other benefits include faster delivery times, greater flexibility, lower inventory levels, and a reduced risk of logistical disruptions. This approach is also the main reason for the record-breaking investments by European companies in China: It is important to adapt its activities in China to the circumstances in the best possible way.

The Chinese market: A must in the portfolio of OEM’s and suppliers

After all, 30.09 million vehicles will be sold in China in 2023. This makes the Chinese car market the largest car market in the world. According to Statista, car sales in China will increase by a good twelve percent between 2022 and 2023 alone. China is a pioneering market, especially when it comes to fully electric vehicles: with around 6.3 million electric vehicles sold, the Chinese market accounts for more than half of the global market.

Chinese brands have significantly increased their share of the passenger car market in China in recent years and now account for an estimated 55 percent. This has been driven by growing interest in electric and plug-in hybrid vehicles, which broke records with growth of 37.9%.

Hot topics: New Energy Vehicles (NEVs) and autonomous driving

The New Energy Vehicles (NEVs) segment is of great interest to major international automakers, but it is also highly competitive. Every year, the Center of Automotive Management (CAM) examines the innovative strength of automakers. Based on 1,000 innovations from the 2023/2024 analysis period, there is a radical shift in innovative strength in favor of Chinese automakers: for the first time, there are five (!) Chinese automakers among the top 10 most innovative automakers.

The field of autonomous vehicles is also attracting more and more companies, as China is making great efforts to prepare the infrastructure for autonomous vehicles. Near the eastern Chinese city of Suzhou, a 56 km long intelligent highway for level 4 autonomous driving has been put into operation as a test track.

The European automotive industry must intensify its engagement in China and with Chinese competitors to avoid being left behind.


New Energy Vehicle (NEV) market share in 2023


automobiles exported from China in 2023

Key region Shanghai

China's financial capital, Shanghai leads the way of the development of the country and is a superlative city. With its 18 million habitants, it is one of the biggest cities in the world and the most important industrial hub in China. It was its location at the delta of the Yangzi, the longest and most important river in China, which caused this fantastic rise. Today Shanghai shelters one of the biggest harbours worldwide, accommodates the most important stock-market of the country and runs the only Transrapid connection between the international airport and the city district of Pudong.

Did you know?

Auto Shanghai combines all benefts of a large-scale comprehensive trade fair which serves as an international platform for exhibitors and visitors.

On the basis of the success of the past editions and its innovative concept, Auto Shanghai brings together all automotive giants every two years to discuss the future of the automotive industry. As one of the two leading trade fairs for the automotive industry in China, Auto Shanghai has received large numbers of exhibitors, visitors and media from all over the world ever since 1985.