21 Jun 18

China invests 7 times more in EVs than Europe

In the past year, China has secured €21.7 billion of investment in electric vehicles while Europe only secured €3.2 billion, according to a study by Transport & Environment, a European non-profit promoting sustainable transport policy.

This disparity isn't explained by the size difference as China produces a third more cars than Europe. Rather, it's about government policy. The Chinese government requires carmakers to obtain credits for the production of EVs that are equivalent to 10% of the overall passenger car market in 2019 and 12% in 2020.

The European Commission, on the other hand, proposed new car CO2 reduction targets of 15% in 2025 and 30% in 2030 but didn't include any sales targets for zero-emission vehicles.

Diesel legacy

Julia Poliscanova, clean vehicles manager of Transport & Environment, said: “China bet decisively on electric cars and is winning the race. It understood that production follows demand, and demand is created with smart, ambitious industrial policy. But Europe still can’t shake off its dirty diesel legacy. The EU ministers have two choices: either we set an EV sales target to keep auto jobs at home, or allow European carmakers to go on selling dirty diesels here while investing the earnings into EV production abroad and importing back made-in-China electric cars.”

OEM efforts

European manufacturers, who are joining forces with local OEMs, are investing more in China than in Europe:

  • Volkswagen: invests €10 billion in a joint venture with the Chinese Anhui Jianghuai as part of its Roadmap E initiative to sell 1.5 billion EVs globally by 2025
  • Nissan will invest €8 billion as part of a joint venture with Renault and Dongfeng
  • Daimler AG joins forces with BAIC and invests €1.6 billion to expand the production of Mercedes EVs


A recent study by Cambridge Econometrics (endorsed by BMW, Renault-Nissan, Valeo, ABB) concluded that 206,000 net jobs could be created in Europe through a shift from fossil-fuel powered vehicles to ones driven by renewable energy by 2030. This is based upon the assumption that 25% of vehicles sold will be hybrid, 8% plug-in hybrid, 15% battery electric and 2% fuel cell cars, the remaining 50% being fossil-fuel vehicles.

Even if the numbers in that study appear to be optimistic, the European Commission could use them to introduce more ambitious EV targets.

Image: Volvo XC90 EV, image source graph: Transport & Environment

Authored by: Benjamin Uyttebroeck