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China may increasingly seek to use its dominance in the global electric vehicle industry as geopolitical leverage, giving Beijing greater influence over countries dependent on its technology and supply chains, according to analysts.
“With China, the strategy is different. It’s to overwhelm the industry, capture it, and use it ultimately as leverage,” said Michael Dunne, CEO of Dunne Insights, an auto advisory firm.
“When it comes to crunch time, they say, ‘Oh, by the way, we’re the source of all manufactured cars today. How about that?’” Dunne said during a discussion hosted by the Asia Society Policy Institute (ASPI).
“And you’re dependent on us for cars, and we want this and this and this from you on other political issues.”
China’s slowing domestic auto market has pushed its carmakers to expand overseas, with monthly vehicle exports surpassing one million for the first time in June and projected to reach around 12 million by year-end.
The global expansion of cheaper, high-quality Chinese electric and hybrid vehicles has sparked concerns in many countries over Beijing’s alleged “overcapacity”, which governments attribute to state subsidies – a charge China denies.
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