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China overtakes Japan as world’s top vehicle exporter in 2023

China’s dominant position in the electric car market has propelled it to surpass Japan as the world’s largest vehicle exporter in 2023. While Japan’s major automakers, including Toyota and Nissan, have been cautious about fully embracing electric vehicles (EVs), Chinese counterparts like BYD have aggressively pursued the EV market.

Data released by the Japan Automobile Manufacturers Association revealed a 16% increase in vehicle shipments from Japan, totaling 4.42 million units. However, China, with a total of 4.91 million exported vehicles, outpaced Japan. According to China’s customs bureau, the number was even higher at 5.22 million, representing a significant year-on-year rise of 57%, with one in three vehicles being fully electric.

Chinese EV companies, supported by strong government backing, have outpaced established global rivals, leading to BYD overtaking Tesla for the most sales of all-electric vehicles in the fourth quarter of 2023. Japanese automakers, traditionally strong in hybrid models, have recognized the need to intensify their efforts in the EV space, with Toyota aiming to sell 1.5 million EVs annually by 2026 and 3.5 million by 2030.

Despite China’s success, it has faced scrutiny from regulators in Western markets concerned about unfair competition. The European Commission is investigating Chinese state subsidies, potentially leading to the imposition of import duties by the European Union. To address these concerns, BYD is planning to establish more factories abroad, including a $600 million plant in Brazil and another in Hungary.

This shift in global rankings echoes Japan’s experience in the 1980s when it became a major automotive exporter, prompting the construction of overseas factories to balance production and exports.

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