Only a Small Number of China's 129 EV Manufacturers Might Endure Severe Market Collapse | Carscoops

      A recent study indicates that merely 15 out of the 129 local car manufacturers currently operating in China are likely to survive in the coming years.

      As of 2024, there were still 129 NEV companies active in the Chinese automotive sector. The consulting firm AlixPartners predicts that only 15 EV brands will remain financially sound by 2030. At present, only BYD, Li Auto, and Seres Group are profitable within the Chinese EV market.

      The electric vehicle surge in China has transformed the global automotive industry, yet not all participants will endure. While China's automotive sector has become a powerful entity, a new report points out that only a small number of the nation's EV brands are expected to persist in the future.

      With numerous startups already failing and consolidation increasing, China's EV market is on the brink of significant change.

      **Industry Faces Sharp Consolidation**

      In 2018, it was projected that over 500 companies in China were in the process of developing "new energy" vehicles. Many of these firms were unable to launch and rapidly went out of business. As of 2024, it is reported that there are 129 companies marketing NEVs in China.

      According to AlixPartners, only 15 of these are anticipated to remain financially viable by 2030. While the consulting firm has not disclosed which brands it expects to survive, these 15 could represent about 75 percent of the entire EV and plug-in hybrid market in China. Some of these have already achieved annual profitability.

      Stephen Dyer, head of AlixPartners' automotive practice in Asia, noted that certain local governments may support struggling companies to safeguard jobs and local economies. Consequently, consolidation in the industry might progress more slowly in the next five years.

      **Intense Competition and Rapid Innovation**

      “China is one of the most competitive new energy vehicle markets globally,” Dyer stated. “It is currently experiencing a fierce price war. Its rapid innovation cycle is continually rejuvenated by new participants. This environment promotes substantial advancements in technology and cost efficiency, yet it simultaneously complicates the path for many businesses to achieve sustainable profitability.”

      As reported in March, only three EV brands in China are thought to have reached profitability: BYD, Li Auto, and Seres Group, which includes the Seres, Aito, and Landian brands. Other local firms such as Zeekr, Xpeng, and Leapmotor are approaching profitability.