China Energy Brief: Issue 1

China's electric vehicles go global—and reshape Beijing's geopolitical leverage abroad.

Welcome to the China Energy Brief

We’re glad to have you here for the inaugural issue of the China Energy Brief, a monthly newsletter from the China Climate Hub. Drawing on deep expertise and networks across Beijing and Washington, each issue offers forward-looking, evidence-based insights into the forces shaping China’s green tech and energy action—and what it means for the U.S. and beyond.

This month, we take you onto the floor of the world’s largest-ever Beijing Auto Show, where the future of the electric vehicle industry was on full display. Beyond the gleaming new models, we unpack two trends with far-reaching implications: the accelerating global push of China’s cleantech exports, and how those tailwinds are reshaping Beijing’s leverage in its dealings with the rest of the world.

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Enjoy the read.

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China Energy Brief: Issue 1

Written by Kate Logan, Director of the China Climate Hub

The Beijing Auto Show was held from April 24 to May 3, setting an official record as the world’s largest auto show by both scale and vehicle count. What was once a standard car exhibition has morphed into a showcase for the forefront of electric vehicle innovation. I visited this year’s show, which coincided with the lead-up to Trump’s recent summit with Xi in Beijing and took place as the global energy crisis from the Iran conflict entered its third month. Beyond the shiny new car models, two important trends reflect how China and its leading firms are approaching their global strategies.

First, China’s cleantech exports will grow even stronger, which will pivot cleantech companies’ hypercompetitive mindsets into the global domain.

The official tagline of the Beijing Auto Show was translated as “future of intelligence.” But a secondary, unofficial theme permeating countless booths was “made in China, for the world”—underscoring the shift from serving the domestic market to serving overseas consumers. This trend is driven by both domestic and international factors.

Within the Chinese market, demand for EVs and other cleantech is waning, especially as incentives are removed and prices and purchases adjust accordingly. Weakening demand started “pushing” Chinese cleantech exports toward global markets well before the current energy crisis. One analyst shared that they had to revise their earlier projections that EV exports would slow by mid-2025 after observing sustained strong flows, especially in markets with few trade barriers, such as Australia and the Philippines. Export growth has been further amplified in recent months by the “pull effect” from international consumers looking to take advantage of low-cost clean energy amid spiking fuel prices. In April, domestic auto sales fell for the seventh straight month and were down 21.6% year-on-year, while EV and plug-in hybrid exports surged to more than double the same month a year prior.

Amid the Auto Show’s 17 massive exhibition halls spanning two separate conference centers, nearly every major automaker showcased a new, competitively priced luxury electric or hybrid-electric SUV—a trend that surprised me given the international obsession with China’s uber-affordable electric sedans, such as the BYD Seal. The factors elevating SUVs to the forefront reflect shifting market dynamics. Some of these vehicles will be sold domestically in an attempt to recover declining revenues. But with many of these models appearing nearly identical, many brands emphasized their desire to court global consumers, especially in high-end markets, including the Middle East. In Europe, hybrid vehicles are not subject to the same tariffs as EVs, paving the way for these battery-electric hybrids to make greater inroads.

While the show was about cars, batteries were the real stars. Attendees clustered around the pavilions of CATL and BYD’s battery arm, both of which featured cold chambers to showcase their batteries’ consistent performance even in Arctic environments ranging from –30 to –50 degrees Celsius (approximately –22 to –59 degrees Fahrenheit). While BYD emphasized the speed of its flash chargers—“ready in 5, full in 9”—CATL’s centerpiece was battery swapping, with a working model demonstrating the speed and convenience of swapping. CATL has touted its use of large language models (LLMs) to revolutionize battery chemistry research, thus freeing up revenues to spend on other areas of its global strategy.

The technologically sleek, all-electric vehicles of Chinese firms stood in contrast to those of several legacy foreign automakers, such as BMW, Audi, and Mercedes-Benz, which positioned some of their most historic vehicles as the centerpieces of their pavilions—as if to remind consumers that they had invented the internal combustion engine that powered the original automobile revolution.

Second, the tailwinds behind China’s exports have empowered Beijing to wield its leverage in responding to various demands from other countries.

In the weeks before the Trump-Xi Summit, letters emerged from House Democrats and Republicans, respectively—followed by bipartisan House and Senate bills—urging President Trump to prevent Chinese EVs from entering the U.S. market. Legislators feared he might strike a deal with Xi, akin to Canadian Prime Minister Mark Carney’s offer, in which Canada would import a limited number of Chinese EVs in exchange for Chinese investments into Canada.

But few in Beijing were closely following each escalation of this American pushback. Instead, Chinese players are eyeing more compelling opportunities elsewhere. This dynamic is perhaps also underscored by the Chinese companies invited by Xi to the state banquet with Trump during the summit: the overall absence of China’s cleantech darlings, save for perhaps tech brand Xiaomi, reflects Beijing’s hesitation to push deals if Washington remains ambivalent about accepting them.

The lingering effects of China’s October 2025 export controls on rare earth elements and lithium-battery materials still loom large, with companies lacking confidence that bilateral relations are stable enough to guarantee that Beijing will renew its temporary suspension. Moreover, Chinese companies that had been pursuing deals involving international tech transfer in other markets are facing down bureaucratic uncertainty from their own government. As one example, Chinese battery maker Hithium’s proposed partnership with Indian renewable conglomerate Reliance has yet to move forward despite sustained efforts. The important role of China’s Ministry of Commerce (MOFCOM) as a closed-door arbiter introduces significant procedural uncertainty into potential deals; new State Council regulations on overseas investment will further compound this. Beyond bureaucratic factors, competition among leading cleantech firms with similar products is so intense that preserving leverage vis-à-vis rivals may further dampen companies’ willingness to share their technology.

Commercial interests are most attracted to those markets that have issued some sort of political signal that Chinese firms are welcome to invest. As one example, while cynicism abounds toward the EU’s proposed Industrial Accelerator Act—especially since Japanese and Korean firms would be exempt from the various strings attached to future Chinese investments—enthusiasm for the Spanish market remains strong in the wake of Spanish Prime Minister Pedro Sánchez’s trip to Beijing. Following the visit, SAIC Motor announced its decision to locate a new EV factory in Spain rather than Hungary, underscoring how political signals can tilt Chinese investment decisions even at the margins. Reports also indicate that wind manufacturer Ming Yang, fresh off a UK rejection on security grounds, is now eyeing the Spanish market.

These two trends will no doubt accelerate global electrification—but they will also pose tough questions for international markets, especially those struggling to preserve their local industries. As I wandered around the show, I could not help but wonder how long global consumers could resist the high quality and marked affordability of the products I was seeing. Will other markets continue doubling down on trade barriers, or will they reconsider them? And will Beijing be willing to engage with increasingly restrictive investment environments, or will it start abandoning them in lieu of those that welcome Chinese firms?