5

The rise of electric vehicles in China: Growth, challenges and future prospects

Shanjun Li, Ha Pham, Yuerong Wang and Lin Yang

This chapter examines the evolution of China’s electric vehicle (EV) industry over the past decade, documenting its rapid expansion, policy support and market dynamics. It explores the factors that contribute to China’s dominant role in global EV production and sales, including government incentives, the accessibility of charging infrastructure and automaker expansion strategies. The chapter then addresses the ongoing challenges facing the industry, such as intensifying global competition, trade barriers, battery technology constraints and infrastructure disparities. Finally, the chapter discusses prospects for the industry, highlighting technological advancements, supply chain resilience and emerging policy developments to further promote sustainable mobility.

EV market trends

The global EV market has expanded rapidly during the past decade, reaching approximately 17.1 million units by 2024, as shown in Figure 5.1.¹ China, Europe and the United States are the three dominant EV markets. In 2024, China accounted for nearly 65 per cent of global sales, maintaining its position as by far the world’s largest EV market. Meanwhile, Europe and the United States contributed 18 per cent and 8 per cent of total EV sales, respectively. Globally, the share of EVs reached nearly 20 per cent of all new passenger vehicle sales in 2024, as depicted in Figure 5.1. Significant disparity in EV penetration exists across markets: the market share of EVs was 48 per cent in China, 24 per cent in Europe as a whole and only 11 per cent in the United States.

Figure 5.1: Global electric vehicle sales, 2012–24

Notes: The yellow line represents the global EV market share among all new passenger vehicle sales.

Sources: IEA Global EV Outlook (www.iea.org/data-and-statistics/data-tools/global-ev-data-explorer); MarkLines (www.marklines.com/portal_top_en.html).

While the United States was the global leader in EV sales before 2015, sales growth there has since been the slowest among the three markets. From 2016, China consistently outpaced both Europe and the United States in annual EV sales, except in 2020, when Europe temporarily overtook it, largely due to strict Covid-19 shutdowns in China. After 2020, China entered a phase of explosive growth, positioning it as the principal engine of global EV market expansion. In 2024, total EV production reached 12.89 million units, making China the first country to achieve an annual EV production volume of more than 10 million units—a remarkable increase from just 18,000 units in 2013. China’s emergence as a global EV leader stems from a decade-long strategic commitment to industry development. The foundation was laid in 2009 with the ‘Ten Cities, Thousand Vehicles’ pilot program, which initiated state-supported market cultivation. Since then, a combination of generous subsidies, environmental regulations and targeted industrial policies accelerated EV adoption.

The growth of China’s EV market has implications that extend beyond its borders. In 2024, China’s EV exports surpassed 2 million units for the first time, with Europe and South-East Asia emerging as key destinations. This outward expansion reflects the increasing global competitiveness of Chinese manufacturers, driven by cost advantages, technological innovation and, increasingly, brand reputation. As China continues to lead the global EV transition, it is important to understand the key factors behind its success, such as business strategies and policy frameworks. In the following sections, we explore these key factors, offering insight into how China has emerged as a dominant force in the global EV industry, the challenges and future prospects.

Industry development

This section examines the key drivers behind the rise of China’s EV industry by first exploring how automakers have pursued market leadership, competitive pricing and supply chain integration. It then shifts focus to charging infrastructure, which plays a key role in promoting EV adoption and industry growth.

Market leadership and expansion strategies

The rapid rise of Chinese EV manufacturers is evident in Figure 5.2a, which depicts the number of EV brands by country of origin from 2013 to 2023. Chinese brands (represented in blue) make up the largest share of EV manufacturers. While European, Japanese, South Korean and US automakers have also expanded their presence, their growth has been much slower. As of 2024, China had about 50 active domestic EV manufacturers, with firms such as BYD, Geely, NIO and XPENG playing crucial roles in shaping the industry’s development. These automakers have adopted different strategies to expand both domestically and internationally while driving innovations in battery technology and production efficiency.

Among these manufacturers, BYD has emerged as the market leader, surpassing both domestic and international competitors. In 2024, BYD sold more than 4.25 million EVs, making it the largest EV producer globally. BYD has also accelerated its global expansion by exporting more than 417,000 EVs to international markets, including Europe, South-East Asia and Latin America. A key factor behind BYD’s success is its vertically integrated business model, which allows for inhouse production of key components such as batteries and semiconductor chips. This structure enhances cost control and ensures supply chain reliability, providing competitive advantages over its competitors. Importantly, BYD is one of the few automakers that manufactures battery cells directly from raw materials. This capability is particularly valuable, given that batteries typically account for 30–40 per cent of an EV’s total cost.

Figure 5.2: Comparison of electric vehicle brands and models by country

Notes: (Top) the number of EV brands by country of origin; (Bottom) the growth in the number of EV models.

Sources: IEA Global EV Outlook (www.iea.org/data-and-statistics/data-tools/global-ev-data-explorer); MarkLines Co. (www.marklines.com/portal_top_en.html).

While BYD is the clear market leader, other Chinese automakers are pursuing different strategies to strengthen their positions. Geely plans for EVs to constitute 50 per cent of its total sales by 2025 and utilises multiple sub-brands to target diverse consumers. Meanwhile, China’s leading new-generation EV startups such as NIO, XPENG and Li Auto emphasise technological integration, autonomous driving and digital user experience, setting themselves apart from traditional automotive brands. NIO has gained attention for its battery-swap technology, which allows rapid battery replacement and minimises charging downtime. By the end of 2024, NIO operated nearly 2,800 battery-swap stations across China, with about one-third of those strategically located along highways to facilitate long-distance travel. In contrast, XPENG and Li Auto emphasise autonomous driving technologies, positioning themselves as frontrunners in smart mobility. These differing strategies reflect the broader strategic diversity among Chinese EV manufacturers, who are leveraging innovation and market segmentation to compete for global leadership.

Price competition and model availability

Building on their expansion strategies, Chinese EV manufacturers have further strengthened their market position through competitive pricing and offering a wide range of vehicle models. Supported by substantial government subsidies, economies of scale and dominance in battery manufacturing, Chinese firms enjoy lower production costs than many international competitors. In response to intensifying domestic market competition, automakers in China have engaged in aggressive price competition to attract a greater share of price-sensitive consumers. Throughout 2023 and 2024, the Chinese EV market experienced an intense price war, with virtually all major domestic EV producers, such as BYD, Geely, NIO and Tesla, engaged in price reductions. Since beginning local production of its Model 3 in China in late 2019, Tesla has implemented multiple price cuts in the Chinese market. As of 2024, the price of a Tesla Model 3 in China was approximately 35 per cent lower than its 2019 launch price and about 20 per cent lower than the corresponding price in the United States. On the one hand, these aggressive pricing strategies have squeezed profit margins and directly contributed to the market exit of several brands. On the other hand, they have benefited consumers through improved affordability, thereby expanding domestic EV market share and helping Chinese automakers gain a foothold in overseas markets.

Complementing these pricing strategies is China’s leadership in EV model diversity. As shown in Figure 5.2b, China offers more EV models than any other major market, including Europe, Japan, South Korea and the United States. This extensive range caters to a broad spectrum of consumer preferences, from compact urban vehicles to high-performance luxury models. The continued introduction of new designs and configurations has helped Chinese automakers maintain a strong domestic presence while improving their competitiveness in international markets. By combining affordability with product variety, Chinese EV firms are well positioned to compete in the international market, which may or may not be welcoming such competition.

Supply chain integration and technological advancements

Supply chain integration and technological advancements further reinforce China’s leadership in the EV sector. China is home to CATL and BYD, the world’s two largest EV battery producers, which held 38 per cent and 17 per cent, respectively, of the global market share in 2024, supplying both domestic and international automakers. Overall, China accounted for more than 75 per cent of global EV battery production, underscoring its dominant role in the supply chain—not only in manufacturing, but also in the refining of key materials such as lithium, cobalt and graphite.

Cost reduction through economies of scale has also been critical. China has the world’s largest battery manufacturing capacity, with total production and sales of lithium-ion batteries (primarily for EVs) reaching 1.097 terawatt hours (TWh) and 1.040 TWh, respectively. This production scale allows automakers to secure batteries at lower prices, reducing vehicle costs and increasing competitiveness. Additionally, vertical integration across the value chain, exemplified by firms like BYD, enables inhouse production of batteries, chips and other key components. This strategic control over the supply chain enhances operational resilience and offers a significant advantage in a market increasingly shaped by global supply uncertainties.

Due to its complex nature and sensitivity to material purity, battery manufacturing exhibits significant learning-by-doing effects, where unit production costs decline with accumulated production experience. Barwick et al. (2025) estimate that the unit cost of production for a battery manufacturer decreases by about 7.5 per cent with every doubling of production experience in that firm. Learning by doing in upstream battery production creates a snowball effect in response to EV demand shocks, such as consumer subsidies. Increases in EV sales and consequently battery production triggered by a demand shock lead to lower battery and EV costs, which in turn further stimulate EV adoption. The rapid expansion of EV sales in China and the resulting increase in battery production have given manufacturers operating in the Chinese market, primarily domestic producers, a substantial cost advantage.

The widespread adoption of lithium iron phosphate (LFP) batteries, led by BYD, has proven to be another key driver of cost reductions. BYD not only championed the use of LFP batteries in electric vehicles but also pioneered innovations in battery design and manufacturing, such as its proprietary Blade Battery that enhanced energy density, safety and scalability. These advancements significantly lowered production costs and facilitated broader market adoption. LFP batteries offer enhanced safety and a longer lifespan at a lower cost compared with conventional nickel manganese cobalt (NMC) lithium-ion batteries.

Charging infrastructure development

The rapid expansion of China’s EV market has been strongly supported by the concurrent development of charging infrastructure, which addresses consumer ‘range anxiety’ and supports the broader transition to electrified mobility. By the end of 2023, China had deployed approximately 2.7 million public charging stations—up from just 30,000 in 2013. This expansion included 1.52 million alternating current (AC) chargers and 1.2 million direct current (DC) fast chargers, establishing by far the world’s largest charging network. Government support has been instrumental in this growth. Between 2015 and 2018, public investment in charging infrastructure totalled RMB13.2 billion, accelerating EV adoption in China (Li et al. 2022). More recently, policy efforts have shifted towards enhancing infrastructure quality and accessibility to better accommodate rising demand and advance national electrification goals.

The spatial distribution of charging infrastructure offers further insights into regional dynamics. Figure 5.3a illustrates the density of charging stations and the scale of EV adoption across provinces, measured as the number of charging stations and EVs per 10,000 people. The figure also reveals that EV adoption is clustered in regions with stronger infrastructure development. Figure 5.3b displays the number of EVs per public charger by province. This metric highlights regional disparities in infrastructure coverage, with notable variation in the EV-to-charger ratio across provinces. Such differences indicate that charging infrastructure is not evenly distributed relative to EV ownership. These patterns underscore the need for continued investment to address regional imbalances and ensure equitable access to charging facilities as EV adoption accelerates.

To further integrate EV infrastructure into urban planning, China has introduced policies mandating new residential and commercial developments to include EV charging capabilities. This ensures that infrastructure expansion keeps pace with urbanisation and vehicle electrification. Additionally, the country is investing in ultra-fast charging stations to support long-distance travel, addressing a key limitation of current EV technology. By simultaneously prioritising urban and highway charging networks, China is developing a comprehensive infrastructure ecosystem that not only supports domestic demand but also establishes a global benchmark for large-scale EV deployment.

Figure 5.3: Distribution of electric vehicle stock and charging infrastructure in China

Notes: (Top) the number of charging stations and EV stock per across provinces, standardised to population; (Bottom) the provincial distribution of EVs per public charger.

Source: Electric Vehicle Charging Infrastructure Promotion Alliance (EVCIPA).

Policy landscape

China’s rapid adoption of EVs is largely attributable to its comprehensive policy framework. This section discusses the key components of China’s EV policy landscape, including mandates and regulations, financial and non-financial incentives and industrial policies aimed at promoting the EV industry.

Mandates and regulations

In response to global climate change pressures, many countries have set targets for zero-emission vehicle adoption as part of broader efforts to reduce carbon emissions. In 2020, China set a goal for EVs to account for 40 per cent of new car sales by 2030—a target that was easily surpassed in 2024. Given the market’s rapid growth, this goal has since been substantially revised upward, to 60 per cent. By setting clear objectives and reducing policy uncertainty, the government has created strong incentives for automakers to invest in EV development, fostering competition and accelerating cost reductions and technological innovation.

A range of policies has been developed to support the achievement of EV adoption targets. One key measure is the tightening of fuel economy standards, aimed at improving vehicle efficiency and encouraging the shift to EVs. Central to China’s approach is the Dual Credit Policy, which integrates fuel economy credits with new-energy vehicle credits. This policy functions as a market-based mechanism, allowing automakers to trade credits, thereby providing flexibility while ensuring compliance with fuel efficiency targets. The policy includes progressively stricter fuel consumption targets: 5 litres per 100 kilometres by 2020, 4 litres by 2025 and 3.2 litres by 2030. The fuel economy regulations could encourage innovation in clean vehicle technologies to reduce compliance costs (Barwick et al. 2024b; Rozendaal and Vollebergh 2025).

Financial and non-financial incentives

Beyond regulatory mandates, financial and non-financial incentives have also played a crucial role in promoting EV adoption, particularly during the market’s early development. Direct financial subsidies from both the central and local governments were a key component of China’s EV policy in its initial expansion phase. Between 2010 and 2016, these subsidies—equivalent to 30–60 per cent of EV purchase prices—were expanded from 10 pilot cities to nationwide, substantially reducing the upfront cost of EVs (Li et al. 2022; Barwick et al. 2024a). As the market matured, these subsidies were gradually phased out, between 2019 and 2022, with the policy focus shifting towards infrastructure investment and long-term market sustainability. Tax incentives have complemented direct subsidies. Full purchase tax exemptions for EV buyers have been extended through to 2027, while reduced registration fees offer additional savings in upfront costs.

While financial incentives have been essential in driving initial adoption, non-financial policies have also played a significant role by enhancing convenience and influencing consumer behaviour. The green licence plate policy, introduced in 2016, allows for easy identification of EVs and grants them preferential treatment in parking and traffic regulations. In cities with strict vehicle registration limits, such as Beijing and Shanghai, EV buyers are either exempt from licence plate lotteries or given priority access. Similarly, in cities such as Shenzhen and Guangzhou, where traffic restrictions apply to gasoline-powered vehicles, EVs are exempt from driving bans. The measures adopted in urban areas could be complementary to regulatory constraints on traditional fuel vehicles in promoting EV adoption.

Industrial policies

In parallel with consumer-focused policies, China has adopted strategies to localise and strengthen its EV supply chain. A key measure was the local content requirement. Between 2016 and 2019, China’s whitelist policy mandated that only EVs using batteries from domestically certified suppliers could qualify for government subsidies. By incentivising Chinese EV firms to source batteries from domestic producers, it helped these producers move down the cost curve faster than otherwise, as the policy accelerated learning by doing among them. The policy therefore contributed to the rise of Chinese battery manufacturers such as CATL and BYD, allowing them to be more cost competitive in the global market even after the policy was removed in 2019 (Barwick et al. 2025).

In addition to national policies, a wide range of industrial policies have been implemented by provincial and city governments in China to develop their own local EV industries, often in direct competition with other jurisdictions. These policies include low-cost financing, preferential land access, investment and production subsidies and government procurement support (Fang et al. 2025). These local government efforts have contributed, on the one hand, to the development of a complete EV supply chain—from mineral refining to final vehicle assembly—and, on the other, to the emergence of a highly competitive industry with production capacity exceeding domestic demand. The large number of domestic EV firms and the recent price war among automakers discussed above are manifestations of these policies.

Empirical evidence on policy impacts

Empirical studies broadly confirm the effectiveness of China’s EV policies but also highlight their limitations. Large-scale consumer subsidies, which amounted to between 40 per cent and 60 per cent of an EV’s sale price at their peak, significantly expanded the market and indirectly supported the development of charging infrastructure. These measures reinforced a positive cycle of adoption and investment (Li et al. 2017, 2022, 2024). Building on this foundation, Hu et al. (2025) adopt a dynamic structural model to assess the long-term impact of subsidy design. They find that a gradual phase-out scheme can induce earlier purchases and strengthen market momentum through peer effects and learning by doing, achieving higher sales at lower fiscal cost. In contrast to financial incentives, non-financial policy instruments generally involve lower fiscal costs but demonstrate varying degrees of effectiveness depending on the policy context and consumer behaviour. Li et al. (2022) show that the introduction of green licence plates in China led to a 37 per cent increase in EV sales for a minimal implementation cost. In cities such as Beijing, Shanghai and Guangzhou, EVs benefit from licence plate and driving exemptions, but their impact is limited as consumers often adapt their behaviour without switching to EVs.

Infrastructure investment complements financial and non-financial incentives by directly addressing range anxiety, thereby strengthening consumer confidence and supporting sustained market growth. Empirical evidence emphasises the importance of indirect network effects, noting that EV demand is influenced by the availability of charging infrastructure, while infrastructure investment depends on growing EV adoption (Li et al. 2017; Zhou and Li 2018; Springel 2021). In the Chinese context, the contrast is even more pronounced, as many urban households lack access to private charging facilities—highlighting the critical role of public infrastructure. Li et al. (2022) estimate that every additional 1,000 public charging stations result in a 20 per cent increase in EV sales. A key insight from the literature is that infrastructure investment delivers greater cost effectiveness than purchase subsidies.

Recent studies have also drawn attention to the unintended consequences of subsidies. Wang and Xing (2023) find that although subsidies stimulate market growth and firm entry, they may inadvertently attract low-quality ‘lemon’ firms, leading to reputation losses and reducing the overall efficiency of the program. Guo and Xiao (2023) show that the environmental impact of subsidies could be negative due to the increase in vehicle sales and usage. In addition, subsidies often disproportionately benefit high-income households, raising concerns about equity and environmental justice (Jacqz and Johnston 2024; Wang 2024; Xiao and Liang 2024). These findings highlight the need for more targeted and balanced subsidy policies that promote adoption while ensuring quality control and equitable outcomes.

Challenges and future outlook

Despite remarkable growth over the past decade, China’s EV industry now faces significant challenges, including intensifying international competition, shifting policy environments and rising trade barriers. At the same time, the industry has substantial opportunities as it continues to consolidate to harness economies of scale and expand both production and sales in global markets.

Global competition and trade barriers

Intensifying global competition and the rise of trade barriers pose significant challenges to China’s EV industry. As Chinese EV manufacturers expand into international markets, they face strong competition from established global automakers that have been ramping up investments in EV technology and strengthening their market presence. These legacy manufacturers often benefit from longer histories and stronger brand recognition and hence customer base.

At the same time, rising trade barriers like high import tariffs imposed by key markets, such as the United States and the European Union, create significant obstacles for Chinese EV exports. As of 27 September 2024, the United States increased the tariff on electric vehicles imported from China from 25 per cent to 100 per cent. Similarly, starting on 4 October 2024, the European Union imposed additional tariffs on Chinese EV manufacturers, ranging from 17 per cent to 45 per cent, depending on the company. These tariffs aim to counter unfair subsidies to Chinese EV manufacturers and protect domestic industries from low-cost imports.

These tariffs are also part of broader efforts to strengthen local supply chains and manufacturing capabilities and reduce dependence on China. For example, the US Inflation Reduction Act, signed into law in 2022, includes eligibility requirements for EV tax credits that restrict manufacturers from sourcing key minerals and battery components from China and mandate that final vehicle assembly occurs in North America. This trend of ‘supply chain decoupling’ compels Chinese EV and battery manufacturers to seek alternative markets.

Regulatory developments further exacerbate these challenges. The European Union’s Carbon Border Adjustment Mechanism (CBAM) imposes carbon tariffs on high-emission imports, creating risks for Chinese EV exports. CBAM primarily targets energy-intensive industries such as steel, aluminium and chemicals—key materials in EV manufacturing (Clausing and Wolfram 2023). Since China’s power generation depends heavily on fossil fuels, its EV production has a relatively high carbon footprint, making it more vulnerable to such tariffs. Although EVs themselves are not yet directly subject to CBAM, rising costs for these materials could weaken the competitiveness of Chinese automakers in the European market.

Technological challenges

Despite significant advancements in EV technology, key challenges—such as limited energy density, slow charging speeds and concerns about battery lifespan—continue to hinder widespread adoption. Low energy density remains a key obstacle, as increasing the number of lithium-ion cells to extend driving range adds both cost and weight to the vehicle.

Beyond performance limitations, the rapid expansion of the EV market has intensified challenges in battery recycling and disposal. China’s recycling industry remains complex and largely unregulated, resulting in a low standardised recycling rate. According to a 2023 report by the Development Research Centre of China’s State Council, less than 25 per cent of EV batteries in China were properly recycled. Addressing these challenges requires coordinated efforts in policy development, technological innovation and the establishment of a comprehensive recycling system.

The high costs of battery production and raw material sourcing present further difficulties. China has limited domestic reserves of critical minerals such as lithium, cobalt and nickel, making it heavily dependent on imports. As global demand for EV batteries rises, competition for these materials is intensifying, increasing the risks of supply chain disruptions and rising production costs. These constraints could ultimately affect EV affordability, creating challenges for both manufacturers and consumers.

Charging infrastructure disparities

While China has made impressive strides in building its EV charging network, significant regional disparities remain. Urban centres are relatively well served, but rural and less-developed areas still lack adequate infrastructure. This gap limits EV adoption beyond the major cities. In response, both the central and local governments have launched initiatives to expand infrastructure coverage. The National Development and Reform Commission and the National Energy Administration have called for charging stations in every county and charging piles in eligible townships. Beyond expanding infrastructure, the government has been promoting smart charging technologies, integrating them into EVs and charging networks for better energy management.

Automakers are playing a crucial role in infrastructure expansion. NIO has launched the Power County Plan, aiming to establish battery-swap stations in every county across mainland China by 30 June 2025. In 2024, Huawei partnered with automakers and charging operators to deploy more than 100,000 ultra-fast charging piles, expanding national coverage. XPENG has also expanded its charging network, operating more than 1,880 self-operated charging stations across 420 cities. These combined efforts from both the public and the private sectors are gradually reducing regional disparities in charging infrastructure, promoting EV adoption nationwide.

In addition to access, charging speed remains a key concern among consumers. While sales of high-voltage (800 volt) EV models have increased quickly in the past few years, the deployment of compatible ultra-fast charging stations has not kept pace. These stations cost significantly more to build and often require grid upgrades, posing significant financial and technical barriers. At this early stage of ultra-fast charging infrastructure development, government support plays a crucial role. For example, the Shenzhen Government launched the Ultra-Fast Charging City in June 2023 and, by the end of 2024, more than 1,000 ultra-fast charging stations had been built in the city. As demand for faster charging continues to grow and the costs of using ultra-fast chargers decrease with wider adoption, ultra-fast charging stations are expected to become a key trend in the future development of the EV industry.

Future prospects

China’s EV industry is entering a new phase following its rapid transformation from a market follower to a global leader. As early drivers such as government subsidies and pilot programs have waned in effectiveness, the industry is shifting towards structural reform and innovation driven by market forces. A key area of progress will be the international harmonisation of technical standards. As Chinese EV makers expand into South-East Asia, Latin America and Europe, aligning with diverse market requirements is crucial. Common standards for charging, battery safety and data protection can lower trade barriers, improve compatibility and strengthen global supply chains, while also easing geopolitical tensions and supporting a more integrated EV ecosystem.

In addition to advancements within the vehicles, the future of EVs will be shaped by their integration into broader energy and digital systems. Beyond transportation, EVs are increasingly seen as mobile energy assets that can support grid stability and renewable energy integration through technologies such as vehicle-to-grid and bidirectional charging. Unlocking these benefits will require coordinated investment in grid modernisation, digital infrastructure and supportive policy frameworks. Policymakers and industry leaders must collaborate to ensure EVs serve not only as modes of transport but also as dynamic components of the energy ecosystem.

As EV adoption continues to accelerate in China, ensuring equitable access to the benefits of electrified mobility is becoming increasingly important. Without deliberate policy action, rural areas and low-income communities risk being left behind due to limited charging infrastructure and higher upfront costs. Future policy efforts may need to shift from broad consumer subsidies to more targeted support that addresses these disparities such as public charging investment in underserved areas, incentives for affordable EV models and programs for secondhand EV markets. Promoting a just and inclusive transition could help ensure that the social, economic and environmental benefits of transportation electrification are shared more broadly across society.

References

Barwick, Panle Jia, Hyuk-Soo Kwon, and Shanjun Li. 2024a. Attribute-Based Subsidies and Market Power: An Application to Electric Vehicles. NBER Working Paper No. 32264. Cambridge: National Bureau of Economic Research. doi.org/10.3386/w32264.

Barwick, Panle Jia, Hyuk-Soo Kwon, Shanjun Li, Yucheng Wang, and Nahim B Zahur. 2024b. Industrial Policies and Innovation: Evidence from the Global Automobile Industry. NBER Working Paper No. 33138. Cambridge: National Bureau of Economic Research. doi.org/10.3386/w33138.

Barwick, Panle Jia, Hyuk-Soo Kwon, Shanjun Li, and Nahim B. Zahur. 2025. Drive Down the Cost: Learning by Doing and Government Policies in the Global EV Battery Industry. NBER Working Paper No. 33378. Cambridge: National Bureau of Economic Research. doi.org/10.3386/w33378.

Clausing, Kimberly A., and Catherine Wolfram. 2023. ‘Carbon Border Adjustments, Climate Clubs, and Subsidy Races When Climate Policies Vary.’ Journal of Economic Perspectives 37, no. 3: 137–62. doi.org/10.1257/jep.37.3.137.

Fang, Hanming, Ming Li, and Guangli Lu. 2025. Decoding China’s Industrial Policies. NBER Working Paper No. 33814. Cambridge: National Bureau of Economic Research. doi.org/10.3386/w33814.

Guo, Xiaodan, and Junji Xiao. 2023. ‘Welfare Analysis of the Subsidies in the Chinese Electric Vehicle Industry.’ Journal of Industrial Economics 71, no. 3: 675–727. doi.org/10.1111/joie.12337.

Hu, Yunyi, Haitao Yin, and Li Zhao. 2025. ‘Subsidy Phase-Out and Consumer Demand Dynamics: Evidence from the Battery Electric Vehicle Market in China.’ The Review of Economics and Statistics 107, no. 2: 458–75. doi.org/10.1162/rest_a_01295.

Jacqz, Irene, and Sarah Johnston. 2024. ‘Electric Vehicle Subsidies and Urban Air Pollution Disparities.’ Journal of the Association of Environmental and Resource Economists 11, no. S1. doi.org/10.1086/732516.

Li, Shanjun, Lang Tong, Jianwei Xing, and Yiyi Zhou. 2017. ‘The Market for Electric Vehicles: Indirect Network Effects and Policy Design.’ Journal of the Association of Environmental and Resources Economists 4: 89–133. doi.org/10.1086/689702.

Li, Shanjun, Binglin Wang, and Hui Zhou. 2024. ‘Decarbonizing Passenger Transportation in Developing Countries: Lessons and Perspectives.’ Regional Science and Urban Economics 107: 103977. doi.org/10.1016/j.regsciurbeco.2024.103977.

Li, Shanjun, Xianglei Zhu, Yiding Ma, Fan Zhang, and Hui Zhou. 2022. ‘The Role of Government in the Market for Electric Vehicles: Evidence from China.’ Journal of Policy Analysis and Management 41, no. 2: 450–85. doi.org/10.1002/pam.22362.

Rozendaal, Rik, and Herman Vollebergh. 2025. ‘Policy-Induced Innovation in Clean Technologies: Evidence from the Car Market.’ Journal of the Association of Environmental and Resource Economists 12, no. 3. doi.org/10.1086/731834.

Springel, Katalin. 2021. ‘Network Externality and Subsidy Structure in Two-Sided Markets: Evidence from Electric Vehicle Incentives.’ American Economic Journal: Economic Policy 13, no. 4: 393–432. doi.org/10.1257/pol.20190131.

Wang, Jingyuan, and Jianwei Xing. 2023. ‘Subsidizing Industry Growth in a Market with Lemons: Evidence from the Chinese Electric Vehicle Market.’ 22 November. Available at SSRN: doi.org/10.2139/ssrn.4636568.

Wang, Yucheng. 2024. ‘Who Receives Environmental Benefits from Driving Electric Vehicles?’ November. Available at The Chinese Economist Society: www.china-ces.org/Files/3055abstract/202401190211040421.pdf.

Xiao, Junji, and Jing Liang. 2024. ‘The Incidence and Distributional Effects of Electric Vehicle Subsidies in China.’ 17 September. Available at SSRN: doi.org/10.2139/ssrn.4959489.

Zhou, Yiyi, and Shanjun Li. 2018. ‘Technology Adoption and Critical Mass: The Case of the U.S. Electric Vehicle Market.’ The Journal of Industrial Economics 66, no. 2: 423–80. doi.org/10.1111/joie.12176.

---

1. 1 EVs include both full battery electric vehicles and plug-in hybrid electric vehicles.