Electrical Equipment / Components & Telecoms

The latest customs data released by the General Administration of Customs shows that a total of 1.49 million vehicles were exported from January to April, a year-on-year increase of 76.5%. Customs data shows that among them, 514000 electric vehicles were exported, with a promising increase. At the same time, this has also driven the growth of overseas demand for charging piles, and Chinese charging equipment is expected to become an important component of China's export trade.

Overseas charging equipment gap brings export opportunities

According to customs data, in 2022, global sales of new energy vehicles reached 10.824 million units, a year-on-year increase of 61.6%. With the rapid growth of production and sales of new energy vehicles, the demand for charging infrastructure is also growing rapidly, which provides opportunities for the export of charging equipment in China. According to customs data, the overseas demand for charging stations on Alibaba International Station increased by 245% in 2022, and foreign trade exports have maintained rapid growth for three consecutive years.

Customs data shows that the demand for charging stations on Alibaba International Station mainly comes from the European and American markets, with the UK, Germany, Ireland, the United States, and New Zealand being the top five countries in terms of charging station search popularity. In the first week of March during this year's peak foreign trade season, the overseas demand for charging stations on Alibaba International Station increased by 218% year-on-year, continuing the high growth of the past year. For this reason, Alibaba International Station has set up a dedicated charging station area for the first time, with 295 domestic charging station enterprises collectively settling in.

At this year's Canton Fair, new energy vehicles and charging stations have also become important content to attract foreign investors. With an increase in exhibitors of charging stations, many new products have also made their debut, such as GAC's new A480 charging station, Xiaopeng, Ideal, and Huawei's 800V charging station technology, showcasing China's latest charging technology and products to both domestic and foreign merchants.

China Merchants Securities pointed out that under policy subsidies in 2023, the construction of charging stations in the European and American markets has entered an acceleration period. After years of rapid development, the domestic charging pile industry has formed a complete supply chain, with strong competitive advantages in modules and whole piles. Some enterprises have passed European and American standard certification. With the high growth of overseas orders in 2023, the charging pile sector is expected to replicate the market trend of the energy storage sector in 2022.

Research institutions predict that the market size of new energy vehicle charging piles in Europe will increase from 5 billion euros in 2021 to 15 billion euros in the next 10 years. The President of the European Association of Automobile Manufacturers, De Mayo, has stated that the installation progress of electric vehicle charging stations in EU member countries is "far from enough". To support the transformation of the automotive industry towards electrification, 14000 new charging stations need to be added every week, compared to only 2000 currently. According to the plan, by 2030, electric vehicles in the United States will account for at least 50% of new car sales and require 500000 charging stations. To this end, the US government plans to invest $7.5 billion in the field of electric vehicle charging facilities. It is worth noting that the current penetration rate of electric vehicles in the United States is less than 10%, and the vast market growth space provides a development opportunity for domestic charging equipment exports.

Tong Zongqi, Deputy Secretary General of the Charging and Exchange Branch of the China Association of Automobile Manufacturers and Deputy Secretary General of the China Electric Vehicle Charging Infrastructure Promotion Alliance, stated in an interview with reporters that in the past two years, many charging equipment companies in China have been exporting to overseas markets such as Europe, America, and Southeast Asia. This is mainly due to the rapid growth of the overseas new energy vehicle market, which has driven the demand for charging infrastructure growth. As countries accelerate the promotion of new energy vehicle markets, the demand for charging infrastructure is also increasing. The rapid development of new energy vehicle markets in countries and regions such as Europe, America, Southeast Asia, and India has also driven the growth of charging facility demand. These countries and regions have become the main markets for China's charging equipment exports.

China's charging equipment has advantages in developing overseas markets with good quality and low cost

Chinese charging equipment enterprises have strong manufacturing and supply chain management capabilities, low cost and good quality of charging equipment, and have significant advantages when exporting overseas. Compared to domestic markets, overseas markets also bring higher profits to related enterprises, which has led many enterprises to strengthen their overseas market layout and build overseas sales networks.

Chinese charging equipment has certain advantages in terms of technology and products, which can adapt to the different needs of different overseas markets and provide various products. Tong Zongqi said that the certification of overseas standards such as European and American standards is not too difficult in terms of technology. Therefore, many Chinese equipment companies are also developing and producing European and American standard products to better expand overseas markets. At the same time, the export of new energy vehicles in China also needs to meet the charging needs of consumers overseas, which also requires the cooperation of charging equipment manufacturers to export together, which has to some extent driven the export of charging equipment in China.

According to the person in charge of Shuangjie Electric's overseas business, in 2019, Shuangjie's charging pile business was first exported to the Saudi Arabian market. Since then, the export scope has been continuously expanded. Currently, charging piles have been exported to overseas markets such as India, Indonesia, Singapore, and Germany. In 2022, the overseas market sales reached 100 million yuan, and it is expected that there will be a significant increase this year. According to Wang Kunpeng, Vice President and General Manager of the Brand Center of TEDA, TEDA is also developing overseas markets and utilizing its overseas partners to export to markets such as Russia, Southeast Asia, and the Middle East. Faced with fierce domestic market competition, more charging equipment manufacturers are starting to explore new blue oceans in overseas markets.

To continuously enhance competitiveness

Although there is a strong demand for charging equipment in overseas markets and Chinese equipment also has a strong competitive advantage, the export of Chinese charging equipment is not without worries. In addition to the need for standard coordination and service network support, there are also other challenges to be faced. The recently announced Infrastructure Act by the US government requires subsidized charging stations to be produced locally, and the document takes effect immediately. At the same time, relevant enterprises must adopt the main charging connector standard in the United States, which is the "Joint Charging System". The policy constraints of export destinations have brought certain challenges to China's export of charging equipment. However, in the face of new policy challenges in the United States, relevant companies have also made predictions.

A person from Shenzhen Daotong Technology Co., Ltd. stated that its charging pile orders in the North American market currently mainly come from local commercial customers, and government subsidy projects account for a relatively small proportion. When setting sales targets for 2023, the impact of the US New Deal has been taken into account, so its impact on the company is relatively small. However, in the long run, policy restrictions will gradually become stricter, especially with regards to requirements for domestic manufacturing in the United States. It is understood that Daotong Technology has planned to build a factory in the United States, and the new factory is expected to be completed and put into operation in 2023. The project is currently progressing smoothly. There are also charging station equipment companies that have relocated their headquarters to Europe and other regions in order to better develop overseas markets, in order to layout the global charging station market and address international trade barriers.

In Tong Zongqi's view, the export of charging equipment will also face some challenges in the international trade market, just like Chinese products such as new energy vehicles and power batteries. This requires enterprises to make predictions and make plans based on their own characteristics and different requirements of the target market. "China's charging equipment exports need to continue to reduce costs and increase efficiency, continuously improve the competitiveness of their own products, in order to continue expanding overseas markets," said Tong Zongqi.

It should be noted that as a charging device closely related to the use of new energy vehicles, compatibility with the vehicle model is very important. Although there are not significant obstacles to the universality of charging stations, in different markets and for different vehicle models, in order to fully meet the charging needs of various vehicle models, manufacturers need to do a good job in adaptation to improve consumer convenience. It is understood that software has a certain impact on the development of charging devices overseas. Manufacturers in different overseas markets need to meet the needs of users in terms of payment security, information security, vehicle charging security, and improved experience according to local requirements.