As private EV makers in the world’s second-largest economy overtake state-owned carmakers and make formidable inroads into overseas markets, including Europe, the research found that Beijing’s industrial policy and subsidies played only a limited role in their success.
The paper, by scholars from Peking University and the Australian National University, challenges the view prevailing in Europe that China’s EV boom was the result of central government intervention. Instead, Beijing’s policies initially constrained private players, the authors argued – a conclusion that comes as the Chinese and European Union trade chiefs begin talks amid fraught economic ties.
“Local governments forged alliances with private manufacturers, leveraging capital markets and policy loopholes,” said Lu Fengming, an assistant professor in the Department of Political and Social Change at the Australian National University, and Ma Xiao, associate professor of political science at Peking University, in the study.
“These partnerships proved pivotal to China’s EV take-off, enabling private firms to outcompete SOEs.”
According to the paper, this success rested on the ability to navigate a policy environment that favoured state-owned enterprises. The researchers examined how local officials cooperated with private firms in pursuit of investment, industrial upgrades and economic diversification. These partnerships drove the rise of Geely, Nio, Xpeng and BYD, helping them beat both SOEs and foreign rivals in innovation, responsiveness and market reach.