China is transitioning from being a follower to being a leader in the global automotive landscape thanks to the rise of its new energy vehicle sector, company executives and analysts said.
Wang Chuanfu, chairman and president of Chinese car manufacturer BYD, said the trend of electrification is "irreversible" in the auto industry and so is the growing momentum of the NEV sector.
The Warren Buffett-backed company saw its 5 millionth NEV, a Denza N7, roll off the assembly line on Wednesday.
Citing the example of BYD itself, Wang said it took the company around 13 years to produce its first million new energy vehicles since its first hybrid model was unveiled in 2008. However, it took just 18 months for the company's cumulative NEV sales to grow from 1 million to 3 million units, and nine more months to catapult the figure to the 5-million mark.
By 2025, NEVs are estimated to account for 60 percent of total vehicle sales in China, and the popularity of such vehicles may allow Chinese marques to seize a domestic market share of 70 percent by the same year, up from 50 percent in 2022, Wang said.
Chinese brands have been more popular in the NEV sector because of their speed of launching new models and the fancy onboard functions offered for tech-savvy Chinese consumers, said Edward Wang, an analyst at J.D. Power China.
Statistics from Gasgoo Auto Research Institute, a think tank for the industry, show that nine out of the 10 bestselling NEVs in the country in the first half of the year were from Chinese brands, with the only exception being Tesla's Model 3, which occupied the 7th place.
He Xiaopeng, CEO of Chinese EV startup Xpeng, said the industry's model of one-way technological transfer from foreign automobile firms to Chinese ones, seen in the past decades, has been challenged.
In late July, Volkswagen reached an agreement with Xpeng to buy a 4.99 percent stake for around $700 million and to codevelop two models for the Chinese market. The two models, which are scheduled for launch in 2026, will bear the Volkswagen marque but feature Xpeng's expertise in software and autonomous driving.
Wang, the chairman of BYD, said that R&D breakthroughs have been the driving force of China's rise in the NEV sector.
As of July, BYD had over 90,000 R&D personnel, who had filed for over 40,000 patents across the world, with more than 28,000 of them already approved.