China's Record Orders for Car-Carrying Vessels Reflect Booming EV Export Market

China’s booming EV Exports: Chinese automakers and shippers are making history with a surge in orders for car-carrying vessels, driven by booming export market for electric vehicles (EVs). According to data from shipping consultancy Veson Nautical, China is poised to elevate its fleet to world's fourth-largest by 2028, with a record number of orders in progress.

Presently, China ranks eighth globally in terms of its fleet size, with 33 car-carrying ships. However, with 47 ships on order, comprising a quarter of global orders, nation is set to make significant strides in maritime domain. Key buyers include prominent automakers like SAIC Motor, Chery Automobile, and EV giant BYD, alongside major shippers such as COSCO and China Merchants.

Surge in Order

surge in orders has largely benefited Chinese shipyards, which have secured 82 per cent of global orders, marking a remarkable feat in industry. Analysts predict emergence of new tre routes tailored exclusively for Chinese automakers, highlighting nation's robust expansion in global automotive market.

Driven by fierce competition, cost-conscious consumers, and economic dynamics, automakers are increasingly venturing into international markets where ir products command higher prices. China, surpassing Japan as largest auto exporter last year, is spearheing this global automotive revolution. Notably, BYD alone exported over 240,000 cars in 2023, constituting 8 per cent of its global sales volume, with plans to ramp up exports to 400,000 units this year.

Foreign players like Tesla and Volkswagen are also capitalising on China's cost-effective supply chain by expanding ir production capacities for exports.

Despite burgeoning demand, rising shipping costs and international concerns over excess industrial capacity have sparked debate. Both U.S. and EU have raised alarms about China potentially flooding ir markets with low-priced products. In response, Chinese authorities have defended ir industrial policies, emphasizing innovation and downplaying role of state support in driving growth.

While concerns over excess capacity persist, particularly in shipbuilding, experts note potential opportunities in niche markets such as car cargo ships. issue of overcapacity was also a topic of discussion during U.S. Treasury Secretary Janet Yellen's recent visit to China, underscoring its significance in global economic landscape.

As China's Minister of Commerce Wang Wentao engages in talks in Europe, discussions surrounding fairness of subsidies for Chinese-me EVs are likely to intensify, furr shaping future of global automotive industry.

With Reuters Inputs