Wang Chuanfu, founder of Chinese EV giant BYD, got a prime seat at Monday’s meeting with Chinese President Xi Jinping, meant to show Beijing’s renewed commitment to its beleaguered tech sector. The Chinese carmaker has gone from strength to strength in recent years, becoming China’s top car seller, prying open overseas markets, and running neck and neck with Tesla in being the world’s top EV maker.
Chinese-made electric vehicles have gained ground in overseas markets in recent years, particularly in markets like Mexico, Malaysia, or Thailand.
One reason is cost: Chinese cars are often priced far more competitively than their Japanese, South Korean, or European-developed competition. Yet Chinese EV makers also claim they succeed because their products are just more innovative.
In a Monday interview with Chinese state broadcaster CCTV, Wang estimated that Chinese EVs are three to five years ahead of their foreign competition.
Wang spoke after a meeting with President Xi Jinping and several other prominent business executives, including Alibaba founder Jack Ma.
The BYD founder called the company’s talent its most important asset. “Behind each of our technologies is innovation … and behind each of our technologies is the hard work of 110,000 engineers,” Wang said.
Analysts have previously noted the speed at which BYD’s vehicles rapidly approached the technological sophistication of leaders like Tesla—yet at a reduced cost. “We were shocked at how fast BYD has caught up,” Paul Gong, executive director of auto research at UBS, said at a Fortune conference last year.
Wang claimed “openness” would allow the rest of the world to enjoy Chinese-made electric vehicles.
Several non-Chinese automakers, including those that long dominated the Chinese market, have struggled to keep pace with the offerings put out by China’s EV makers.
Chinese EV developments
China bet on EVs in the early 2010s, showering both manufacturers and consumers with subsidies. That state support has irked foreign governments, particularly in the U.S. and Europe, who accuse China of fostering overproduction of EVs and dumping them in overseas markets. Last year, the European Union imposed tariffs on Chinese EVs after alleging that prices were “kept artificially low by huge state subsidies.”
In response, Chinese EV makers argue that their low costs are the result of innovative manufacturing and management practices, rather than state support.
Analysts point out that Beijing’s early support created hundreds of new companies. Fierce competition forced carmakers to find ways to innovate to try to stand out while bringing down costs—especially as Beijing began to withdraw its subsidies.
For example, BYD developed its own “blade” battery that does not rely on nickel, which the company claims is safer. Nio, another Chinese EV startup, has tried to pioneer battery swapping for its cars in mainland China.
Carmakers, including new entrants like Xiaomi, are now rushing to offer autonomous features in a bid to get an edge in a fiercely competitive Chinese auto market.
Last week, BYD announced it would include its assisted driving features across more of its lineup, including the sub-$10,000 Seagull. While BYD’s systems aren’t “industry-leading,” they provide “a buffer against intense price competition,” Morningstar analyst Vincent Sun wrote on Wednesday.
