EVs, tariffs in the spotlight as Chinese automakers take leading role at Shanghai auto show

SHANGHAI (AP) — Leading automakers are showcasing their latest designed-for-China and the world models at the Shanghai auto show this week, fighting not to be edged aside in the world’s largest car market while watching for U.S. President Donald Trump’s next steps in his trade war.

This year's show in the sprawling industrial outskirts of Shanghai comes at a pivotal moment. Three decades after Beijing set out to build a world-class auto industry, local manufacturers account for about two-thirds of sales inside China, and a growing share of global exports.

But with U.S. President Donald Trump raising tariffs and the European Union slapping duties on Chinese electric vehicles, selling to some overseas markets is growing increasingly challenging.

“Geopolitics are very complex and the situation remains uncertain,” Wei Jianjun, chairman of Great Wall Motors, told reporters Wednesday. “But Great Wall is always exploring investments in overseas markets.”

The exhibition is holding two media days and two trade days before it opens to the public on Sunday. It runs until May 2.

Encouraged by government subsidies for scrapping older cars for the latest models, Chinese drivers have embraced the switch to electrics, with sales of battery powered and hybrid vehicles jumping 40% last year.

A total of 31.4 million vehicles including buses and trucks were sold last year in the world’s biggest market by sales, up 4.5% compared to a year earlier, the China Association of Automobile Manufacturers reported.

Growth in sales of EVs was offset by falling sales of traditional gasoline and diesel-powered vehicles, which still accounted for just over half of new car sales.

Chinese electric vehicle maker BYD nudged past Tesla as the world’s biggest maker of EVs by sales last year, reporting revenue of over $100 billion. It recently announced an ultra fast EV charging system that it says can provide a full charge for its latest EVs within five to eight minutes, about the time needed to fill up at the pump. It plans to build more than 4,000 of the new charging stations across China.

To gain access to China's potentially huge market, foreign automakers like Volkswagen, General Motors, BMW and Ford set up joint ventures with state-owned local companies beginning in the 1980s and '90s, helping them build the capacity and technology to compete on a world scale.

They also created sprawling supply chains in Shanghai and other major manufacturing hubs, helping to nurture other big names in Chinese automaking, such as BYD, Geely and Great Wall Motors.

With growth at home limited by brutal competition, they're expanding rapidly especially in Southeast Asia and other developing economies with relatively affordable sedans, SUVs and pickup trucks.

Shanghai’s auto show is a gathering for the “survival of the fittest,” said Zhou Lijun, director and chief researcher of the industry analysis group Yiche Research Institute.

That doesn't mean all the EV makers go it alone. BYD teamed up with Daimler, now the Mercedes-Benz Group, to launch its Denza premium brand. It's also challenging Toyota and other top tier brands with its luxury Yangwang brand, priced at up to 2 million yuan ($280,000)

Opening markets wider to foreign competition has given car buyers a choice of more affordable, innovative vehicles. That's a mixed blessing for older automakers like GM, Ford, Toyota and VW that are also fighting a battle of attrition in China.

“China is still a market worth fighting for,” said Oliver Zipse, chairman of the BMW Group, which like other automakers highlighted a “In China, for China,” approach, at “China speed.”

Overhanging the upbeat talk in Shanghai by both Chinese and foreign automakers of manufacturing in China for the world are Trump's tariffs of up to 145% on Chinese goods, despite a 90-day pause that has spared many other countries, and 25% U.S. tax on imported cars and auto parts.

Japanese automaker Nissan Motor Co.'s head of China operations, Stephen Ma, said the company plans to make 10 new battery electric or hybrid models by 2027 in China, for China and for “export to the world, except one country — you can guess which one."

Higher U.S. and European tariffs on foreign-made EVs are prompting Chinese newcomers to shift production closer to those markets as more Western consumers opt for the latest Chinese models.

Just a few decades ago, Nissan, Toyota and other Japanese automakers were fighting trade friction with the United States over their own exports. Now, they employ hundreds of thousands of U.S. workers at their U.S. factories.

“The trade war between China and the United States has blocked direct exports from China to the United States, but it hasn't blocked local production there or the establishment of global production bases in Europe or elsewhere," Zhou said.

A report by the Rhodium Group shows that nearly half the world's markets are restricting imports from China, in part because of national security concerns linked to the advanced electronics in EVs and other high-tech vehicles. A minority of countries like Australia and South Africa remain relatively open, and Russia is a major market but is nearly saturated, it says.

Chinese automakers lag behind global leaders like Toyota in conventional gasoline and diesel fueled vehicles, but they can sell EVs at roughly the same price, while also solving the problems of range and fast charging.

China has become part of what geopolitical analyst Yanmei Xie described as a “technological paradigm shift” in a commentary in the Japanese financial publication Nikkei Asia. Automakers in China are going electric not just because of the green transition, but as a route to “technological and industrial dominance,” she wrote.

EV makers in China have benefited from not having huge legacy operations that have to make the transition, said Stefan Sielaff, vice president of global design for EV maker Zeekr Group, part of Geely's stable of brands. Founded in 2021, it's selling cars in more than 80 markets including in Europe.

“They can immediately react to market demand, to customer demand, and can deliver very, very fast,” he said. “We have done most of these cars in two years. From 0 to 100 in two years.”

AP researcher Yu Bing contributed.

A man films near a special Black Myth:Wukong edition of a Tang L model from BYD during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

Visitors look at the new Firefly model from Chinese automaker Nio during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

Staff from Chinese automaker Nio waits for visitors at their booth during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

An executive from Chinese car manufacturer Geely talks the satellite communication capabilities of its Galaxy Cruiser during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

Oliver Zipse, Chairman of the board of management of BMW AG, speaks during a press conference for BMW at the Shanghai auto show, Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

Exhibitors prepare for an unveiling at the Auto Show in Shanghai, Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

A BYD Han L car model inspired by Black Myth: Wukong is displayed at the Auto Show in Shanghai, Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

Visitors look at the Han L EV model from BYD during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

A man dressed as the character from Black Myth:Wukong promotes a special edition Han L model from BYD during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

An executive from Nissan unveiled the Frontier Pro, a plug-in hybrid, during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

An attendee arrives to the Auto Show in Shanghai, Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

A man talks near the Han L EV model from BYD during the Shanghai auto show on Wednesday, April 23, 2025. (AP Photo/Ng Han Guan)

The ID Aura concept car is shown during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Attendees look at the latest cars from Volkswagen Group during the media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Attendees look at the latest cars from Volkswagen Group during the media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

A concept car is shown during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Ralf Brandstatter, Chairman and CEO of Volkswagen Group China, speaks during the media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Volkswagen executives and guest pose for photos during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Performers take part in the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Performers take part in the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Performers take part in the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

The Audi E5 Sportback is launched during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Olive Blume, Chairman of the Board of Management of Volkswagen Group speaks during a media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Olive Blume, Chairman of the Board of Management of Volkswagen Group, speaks during a media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

A concept car is shown during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

The A6L-etron is launched during the Volkswagen Group media night ahead of the Auto Show in Shanghai, Tuesday, April 22, 2025. (AP Photo/Ng Han Guan)

Following the announcement in the Budget that the "One-for-One Replacement" Scheme for electric vehicles will officially conclude next Tuesday (March 31), BYD (01211) launched a dedicated hotline, aiming to help citizens interested in purchasing an electric vehicle "catch the last train" before the deadline. Mr. Raymond Cheung, the Chief Operating Officer of BYD HK, stated that since the hotline's launch, the market response has been "extremely enthusiastic," adding that "our volume of inquiries and orders continues to hover at historic highs."

In an interview with Bastille Post, Mr. Cheung stated that since February 27, BYD HK has launched a "Special Hotline for Green Mobility Vehicle Purchases", offering a "one-on-one, end-to-end, and expedited" purchasing service, designed to ensure that every citizen intending to switch to an electric vehicle can successfully "catch the last train" before the scheme ends.

Mr. Raymond Cheung, the Chief Operating Officer of BYD HK, Photo source: BYD HK

The "One-for-One Replacement" Scheme for electric vehicles was officially launched in 2018 to encourage car owners to scrap their old fuel-powered private cars and purchase brand-new electric private cars. By scrapping and de-registering a qualifying old private car—and subsequently registering a brand-new electric private car under the "One-for-One Replacement" Scheme—owners are eligible for a First Registration Tax Concession of up to approximately HKD$172,500. Standard electric private cars (purchased without the "One-for-One Replacement" Scheme) are also eligible for a First Registration Tax Concession of up to HKD$58,000.

In this year's Budget, the Financial Secretary, Mr. Paul Chan, announced that the scheme would conclude on March 31, citing that the supply of electric private cars is now sufficient and prices have begun to decrease.

Following the announcement of the Budget, BYD established a dedicated team. Mr. Cheung said that the team provides a seamless, one-stop service covering the entire process: from answering customer inquiries and rapidly matching customers with ready stock vehicles—including popular models such as BYD ATTO 3, Dolphin, Seal, and Denza D9—to assisting with document preparation, expediting contract processing, and finally submitting the necessary paperwork to the Transport Department to complete vehicle registration.

Ample Stock Secured to Help Owners Beat the Scheme Deadline

Mr. Cheung stated that BYD has specifically reserved ample ready stock for Hong Kong customers—covering a wide range of popular models such as ATTO 3, Dolphin, Seal, and even the Denza D9—to ensure there are no supply shortages. Currently, most of the popular models remain in stock and are available for immediate allocation; nevertheless, availability for certain colors or configurations may be limited.

He noted that the team is going all out, aiming to help all prospective electric vehicle owners successfully "catch the last train" before the scheme deadline.

The team is going all out, aiming to help all prospective electric vehicle owners successfully "catch the last train" before the scheme deadline. Photo source: BYD HK

Although the "One-for-One Replacement" Scheme is drawing to a close, BYD HK remains highly confident in the local market for electric private vehicles. Mr. Cheung emphasized that "the inherent technical prowess of the products themselves, combined with their exceptional value for money" constitutes the cornerstone for winning consumer trust.

Recent geopolitical instability in the Middle East has led to fluctuations in international oil prices. Given Hong Kong's heavy reliance on imported energy, rising fuel costs will directly drive up operating expenses for traditional fuel-powered vehicles, which is anticipated to leverage the advantage of electric vehicles' energy costs and increase their market demand.

Premium Brand "Yangwang" Poised to Enter Hong Kong Market

BYD is currently actively preparing to introduce its high-end brand, "Yangwang" to Hong Kong, which is now in the final stages of market assessment and preparatory work. Mr. Cheung described "Yangwang" as the pinnacle of BYD's technological achievements, targeting high-end consumers who seek cutting-edge technology, ultimate performance, and a luxurious experience. In Hong Kong, its future primary competitors will be traditional European luxury automotive brands.

BYD is currently actively preparing to introduce its high-end brand, "Yangwang" to Hong Kong. Photo source: BYD HK

Mr. Cheung pointed out that within BYD's global "Going Global" strategy, Hong Kong serves as an irreplaceable "strategic springboard" and an international "super showroom". Taking the ATTO 3 as an example, its overnight success in turning the top-selling model in Hong Kong has allowed BYD to systematically replicate this winning formula in other right-hand-drive markets, significantly shortening the learning curve. The decision to introduce "Yangwang" to Hong Kong is a strategic move that sees the city's advantage in international influence, laying a solid foundation for the brand's future expansion into broader global markets.

Embracing a "Deep Localization" Strategy

Directed at the unique characteristics of the Hong Kong market, BYD has adopted a "deep localization" strategy, which not only involves far more than a simple conversion from left-hand to right-hand drive, but also encompasses a multitude of specific details. On the software front, the in-vehicle system features a traditional Chinese interface, along with authentic Cantonese voice recognition and navigation system. In terms of hardware, the vehicle's suspension system has been specially tuned to suit Hong Kong's hilly and winding road conditions. Mr. Cheung noted that the introduced models were specifically selected to ensure that their dimensions and driving range are well-suited to Hong Kong's urban environment.

Directed at the unique characteristics of the Hong Kong market, BYD has adopted a "deep localization" strategy. Photo by Bastille Post

With the number of electric vehicle owners increasing rapidly, Mr. Cheung revealed that BYD plans to establish additional repair centers to provide convenient after-sales support. Regarding pricing strategy, the group will continue to uphold its positioning of offering "exceptional value for money".

Looking ahead, the development of charging infrastructure and ecological construction remains crucial to the dissemination of electric vehicles. Mr. Cheung stated that BYD views itself as a key contributor to fostering a green mobility ecosystem in Hong Kong. The group actively collaborates with major charging service providers to ensure its vehicles are compatible with all mainstream charging standards. Furthermore, by facilitating the sharing of charging experiences within its owner community, BYD aims to help alleviate "charging anxiety" among potential buyers.

BYD actively collaborates with major charging service providers to ensure its vehicles are compatible with all mainstream charging standards. Photo by Bastille Post

BYD anticipates that in the early stages of the "One-for-One Replacement" Scheme's conclusion, the market may undergo a brief structural adjustment in sales volume. Nevertheless, Mr. Cheung also expressed unwavering confidence in the long-term future of Hong Kong's electric vehicle market. As the market returns to a competitive landscape driven primarily by product quality, safety, and value, BYD's inherent strengths are expected to become even more pronounced.