August Quick Hit #1
A series of short posts making small points
Yes, China has an immense lead in BEVs, in terms of at least cost and functionality (hardware and software), and maybe quality, too. And yes, as China exports these BEVs around the world, they will take market share from local OEMs. No argument.
But as China switches (rapidly) from ICE to BEV and PHEV, it “strands” quite a lot of ICE manufacturing capacity. Thus we have to remind ourselves that the bulk of Chinese vehicle exports are still ICE. The share that is EV has grown, but has recently stabilized, such that for now at least China is primarily an export powerhouse of gasoline-powered vehicles. (I think we can expect overseas local production of EVs by Chinese OEMs to eventually exceed exports from China: see the history of localization by the Japanese and the Koreans.) Thanks as often is the case to BernsteinSG:1
There is no broader point I am making here about EV versus ICE, etc., only an effort to make sure, as always, we get our facts right.
Disclaimer: I was once a consultant to Bernstein (prior to SG), but that has no influence on my relentlessly citing their work: it remains in my view some of the best Wall Street analysis in the automotive realm.