finance
Automotive CEOs Cite China's Lead in EV Production
CEOs from Toyota, Honda, and Ford have expressed concerns over China's dominance in electric vehicle manufacturing, citing rapid production and low costs. This comes amid declining sales for foreign automakers in China and shifts in global trade policies. Investors are advised to consider diversified strategies in response to these industry changes.
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CEOs from major automakers including Toyota, Honda, and Ford have issued warnings about China's overwhelming advantages in electric vehicle production and manufacturing efficiency. These executives highlighted China's ability to automate processes fully and bring products to market quickly, posing challenges to competitors.
accounts for about 30% of global manufacturing and produced 70% of new electric vehicles in 2024. BYD, a Shenzhen-based company, has outpaced Tesla in sales and is expanding worldwide. A Honda executive visited a Shanghai parts factory and noted its complete automation, with no human workers observed on the floor.
“We have no chance against this," — Toshihiro Mibe, Honda President and CEO, after visiting a Shanghai parts factory (Nikkei Asia). Ford and Toyota leaders echoed similar sentiments, pointing to China's speed in designing and building cars. China can bring vehicles from concept to market in half the time of competitors, aided by cheap labor, efficient supply chains, and tax rebates.”
sales in China dropped from 1.6 million units in 2020 to 640,000 in 2025, with projections below 600,000 this year. Honda's Chinese facilities are operating at 50% capacity due to reduced demand. Toyota reported year-over-year sales declines in China for March.
In response, Honda reactivated its R&D arm to focus on digitization and innovation. At the end of March, Honda announced losses from reassessing its automobile electrification strategy, leading to the cancellation of several EV projects for the U.S. market, including the Honda 0 SUV, Honda 0 Sedan, and Acura RSX.
