For years, China’s electric-vehicle industry was very selective with where it put its money. The home-grown efforts proved to pay off in the short term as EV and plug-in hybrid demand absolutely exploded. But then the domestic market reached a dangerous point of oversaturation: too many car brands and not enough buyers, even in the world’s second-most populous country
Now, the Chinese auto industry is becoming an export-focused one—and that has big implications for the rest of the world.
Welcome back to Critical Materials, your daily roundup for all things electric and tech in the automotive space. Also on deck: a trio of ex-Tesla employees build a new EV charging startup and Waymo’s former CEO throws mad shade on Tesla’s Robotaxi rollout. Let’s jump in.
30%: China EV Industry Spends More Abroad For The First Time Ever
Photo by: BYD
Last year, Chinese automakers were accused of producing vehicles at a rate well above what their own market could sustain. Great Wall Motors’ head of international operations, Parker Shi, told the Financial Times that he believed overcapacity was a «fake concept.»
«I don’t like that kind of judgment from the third party—they don’t know what is happening in my house,» said Shi.
Just over a year later, and China’s EV market is in trouble. An ongoing price war and pressure from local governments to meet production quotas have resulted in brands performing some shady tactics like selling zero-mile used EVs and flooding global markets with their cars. Investment firms have picked up on this and are now, for the first time ever, investing more abroad than at home.
That news comes from Rhodium Group, an investment research group that released a new report showing a «historic shift» in China’s EV investments for 2024. After years of directing 80% of its investments domestically, China has instead invested $16 billion overseas as opposed to just $15 billion into its own market.
Here’s the reason behind the shift, according to Bloomberg:
Chinese companies are being driven to expand globally as overcapacity and a long-running price war at home squeeze margins all along the supply chain. They are also seeking to skirt punishing tariffs in Europe and the U.S. by building production facilities there, and bowing to pressure from foreign customers for more localized production.
“The fact that overseas investments now outpace domestic ones reflects a saturated Chinese market and the strategic appeal of expanding abroad for higher returns,” said Armand Meyer, senior research analyst at Rhodium and an author of the report.
The report notes that around three-quarters of the overseas investments came from battery manufacturers. This has resulted in companies like CATL following their clients to their home markets as tariffs drive the need for domesticated production and lower transportation costs.
These same companies are quickly learning that overseas investments don’t become profitable overnight.
While factories in China can pop up in a matter of months, the start of production in Europe, Mexico and the U.S. can take years. Mountains of red tape and political grandstanding only complicate things. The report notes that only 25% of overseas projects invested in have been completed, while those at home have a 45% completion rate.
Beijing is also freaking out a bit. The government is worried about technology transferring to other countries, a loss of jobs and so-called «industrial hollowing out.» This is weighing heavily on those controlling the money and could, according to Rhodium, lead to tighter government control on foreign investments.
The symbolism of these numbers is huge. For the first time ever, China’s EV future is being built outside of its own walls. Whether or not its existing investment pays off is another story, but this shift—a geopolitical one—shows how global and risky the transition from gas to electrification has become.
60%: Tesla Fired Its Supercharging Team, So They Founded A New Urban Charging Startup
Photo by: Hubber Infrastructure
When Tesla CEO Elon Musk fired much of Tesla’s charging team last year, it ruffled a lot of feathers. A robust charging network was one of the reasons that Tesla was able to become so successful so quickly, and laying off the people responsible for ensuring expansion and uptime are handled smoothly seemed a bit unhinged.
Fast forward a bit and a group of those engineers teamed up to create a new EV charging startup called Hubber. The trio of engineers had one goal in mind: fast, reliable urban charging. And their target customers? Not just folks who are charging their cars for their daily commutes, but taxis, ride-hailing and delivery fleets who need frequent and reliable DC Fast Charging the most, as well as urban-dwelling apartment owners who might not have access to reliable charging where they park.
Hubber recently secured $81 million in investments as it prepares to open its first charging facility in South London this week. The company says that it plans to use that investment to open a number of fast-charging sites that fit its target audience.
Now, I know what you’re thinking, but this isn’t the story of another fast charging provider piggybacking on a parking lot at Sheetz or Wawa. Instead, Hubber is transforming unloved real estate into charging “hubs” that they could only dream about building while at Tesla.
Here’s the picture: Hubber will focus on buying up real estate that would otherwise be passed over by developers—think gas stations, warehouses and other defunct grounds—then figuring out how to best transform them into a charging hub with amenities like restrooms and food. Hubber then plans to lease these spaces out to charging providers who can operate the site on their own network in the newly developed hub.
This approach is actually kind of cool. It fixes a systemic weak point of urban EV ownership while also addressing commercial applications. Furthermore, Hubber appears to have figured out how to do this by just being developers instead of charging network providers—they’re leaving the hard stuff to the companies who already have an established network at their disposal. It’s smart, really, and all it took was Tesla laying them off to jumpstart the vision.
90%: Former Waymo CEO: ‘Let Me Know When Tesla Launches A Robotaxi’
Photo by: InsideEVs
Waymo’s former CEO, John Krafcik, threw some major shade on Tesla’s much-hyped Robotaxi over the weekend. In an interview with Business Insider, the company’s ex-boss didn’t hold back his feelings about the service, criticizing the Robotaxi network for not being an autonomous ride-hailing service, but instead a glorified iteration of Uber.
«If they were striving to re-create today’s Bay Area Uber experience, looks like they’ve absolutely nailed it,” Krafcik told Business Insider, noting he had no interest in trying out the service. He continued:
«Please let me know when Tesla launches a robotaxi—I’m still waiting. It’s (rather obviously) not a robotaxi if there’s an employee inside the car.»
The words come as both Waymo and Tesla have entered into a spirited competition to expand their respective service areas. Both companies have recently gone tit-for-tat, growing the area that they serve in existing markets and even moving into new states completely.
The difference, obviously, is Waymo’s lack of safety drivers, whereas Tesla has parked someone in the front seat (or in some cases, behind the wheel).
It seems that Tesla’s strategy is to scale quickly. While Waymo has invested a significant amount of money into its sensor-heavy cars, Tesla believes it can use its vision-only approach to solve self-driving. The only problem is that the scaling can only happen so quickly, especially when the software is, according to Tesla’s Head of Autopilot and AI Software, Ashok Elluswamy, «a couple of years» behind Waymo.
Waymo’s VP of Onboard Engineering, Srikanth Thirumalai, recently explained that Lidar and radar are still viewed as a necessary “additional safety net” to make sure that its cars have adequate data to make decisions “under all conditions” like inclement weather.
Here’s an excerpt from Fortune covering a recent talk given by Thirumalai:
Thirumalai wouldn’t say directly whether he considered camera-only self-driving systems like Tesla’s to be safe for the public roads. He said that you have to consider “the whole process” of how a system is built, tested, then validated, and he also said that you cannot statistically compare Waymo’s system to another, because of the lack of comparable safety metrics.
General Motors’ subsidiary Cruise, which also used LiDAR and radar systems, suspended operations earlier this year after it failed to relaunch after a serious accident in San Francisco.
For context, Tesla said it had driven 7,000 driverless miles at the end of July, compared to Waymo’s 100 million.
In the end, Krafcik’s callout is two-fold. First, there’s the call for Tesla to give some honesty in its branding—something that many have chastised the automaker for in the past. Second is a bit more of a tongue-in-cheek slap to defend Waymo’s position as a segment leader.
Either way, until Tesla removes its human safety layer, it’s clear that Krafcik isn’t ready to admit that the service is on Waymo’s level.
100%: What’s The Perfect Car To EV Swap?
I recently came across a Tesla Model 3 rear drive unit on Facebook Marketplace for $500. I couldn’t believe it was that cheap, and it took everything in me not to go buy it and store it in my garage for ages while I pretend that I’m going to actually put it into a project car.
That got me thinking about what the perfect platform would be to swap an EV drivetrain into. My mind instantly went to my beloved classic, the BMW E36 3 Series—but that’s too Mate Rimac. What about some sort of fun hot hatch like a blown-up Ford Focus RS? Nah, too expensive (plus, those make some fun noises). Maybe I’m looking in the wrong direction and need to find something more practical—would an old Volvo wagon be my answer?
There are just so many options, and none of them seem inherently wrong, just different. So now it’s your turn: what car would you love to throw a cheap EV swap into?
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