China is exporting so many EVs that it needs more ships – a lot more
Chinese EV makers are looking to export electric vehicles by the tens of thousands around the globe, but they need a lot more car-carrying vessels to make that happen. Demand is so high that the country is on track to amass what will be the world’s fourth-largest fleet in a few short years, with new trade routes being created especially for Chinese EVs.
China now has the world’s eighth-largest shipping fleet with 33 car-carrying ships, according to data from shipping consultants Veson Nautical and reported by Reuters. By comparison, Japan tops the list with 284 ships, followed by Norway, which has 102. South Korea comes in third with 72 and the Isle of Man, which has 61 registered ships, in fourth.
Yet, the current state of affairs is rapidly changing, with Chinese companies putting 47 ships on order, which accounts for a quarter of all orders globally. Customers buying the ships include SAIC Motor, Chery, BYD, as well as shipping companies COSCO and China Merchants “on behalf of Chinese automakers,” reports Reuters.
“After this armada has been delivered to China, the Chinese controlled car carrier fleet will jump from current 2.4% to 8.7%,” Veson analyst Andrea de Luca told Reuters. “We expect to see new trade routes established almost exclusively for Chinese OEMs.”
China has already overtaken Japan as the world’s largest auto exporter, with BYD alone exporting more than 240,000 vehicles last year, making up about 80% of its global sales. This year, it plans to export up to 400,000 EVs. The EV giant already has one purpose-built 7,000-EV-capacity ship and plans to add seven more such vessels in two years.
Tesla and Volkswagen have also expanded their exports from China, which of course leverages the country’s cheaper supply chain to their advantage.
Cars are typically transported by sea using roll-on/roll-off (RORO) ships that allow vehicles to be driven directly on rather than using a crane. But these ships have been in short supply in recent years, with older vessels being retired and new ship orders down due to both the 2008 financial crisis and the industry upgrade to less-polluting fuels, reports MIT Technology Review.
In Japan, Nissan and Toyota each have fleets of RORO ships that can carry tens of thousands of cars, but for China, its domestic car-carrier vessels have represented a tiny portion of the global shipping capacity – only 2.8% – leaving Chinese companies few options for exporting their cars.
As a result, access to RORO ships has cost a fortune, with the daily rate to charter ships reaching $115,000 a day. That’s more than seven times higher than the price in 2019. So companies have turned to just buying the ship themselves.
Electrek’s Take
This is all happening as China is under scrutiny for what the European Commission says is unfairly subsidizing EVs exporting to Europe, with Washington keeping a close eye. For one, in China, the state subsidies paired with the economic slowdown have created a massive pileup of oversupply, with companies looking to export and clear out inventories. Hence, cheap EVs coming your way (well, not in the US, at least not yet anyway). Still, steep import tariffs await on European borders.
And let’s peek under the hood a bit too: Chinese President Xi “had accelerated an industrial drive centered on EVs, semiconductors and artificial intelligence and renewable energy” to try to compete with the US, China correspondent Lingling Wei told Reuters. But behind the scenes “is a struggling overall economy that many economists say could see even greater waste down the road because of the state-led industrial drive,” she said.
Not to mention, the shipping industry is currently facing its own carbon emissions reckoning and needs to radically decarbonize in the coming years to meet Paris climate goals. It’s currently sixth largest greenhouse gas emitter worldwide, which puts it between Japan and Germany, according to the World Bank. So moving EVs all over the world certainly comes at a price, environmentally, of course.
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Lucid Motors (LCID) will continue offering the $7,500 federal EV tax credit for Gravity buyers until the end of the year. Lucid’s interim CEO, Marc Winterhoff, said the electric SUV has “so many orders” and it doesn’t want buyers to lose out on the savings.
Are orders for Lucid’s Gravity SUV picking up?
Apparently, demand for Lucid’s new Gravity SUV is picking up. A recent Automotive News report claimed that Lucid registered just nine Gravity models in its first six months on the market, but the company was quick to shut down the rumors.
Lucid’s communication boss, Nick Twork, told Electrek in an email that the report was “completely inaccurate,” adding “a quick review of social media postings from our customers shows that those numbers are simply not credible.”
According to Twork, Gravity deliveries are “well into the 3-digit range.” In the second half of the year, Lucid expects the SUV to account for the majority of deliveries and production.
Winterhoff confirmed on Lucid’s second-quarter earnings call that production of the Gravity SUV was “beginning to ramp up” after resolving most of the supply chain issues that had limited output in the first half of the year.
Since it started offering test drives while adding Gravity models to its studios, Lucid’s interim CEO said the daily order rate for the electric SUV has nearly doubled.
During a new interview with Brew Markets on Tuesday, Winterhoff suggested that the Gravity is quickly attracting buyers. Lucid’s chief confirmed it will honor the $7,500 federal EV tax credit for Gravity buyers until the end of the year “because we have so many orders and we don’t want to tell order holders, you know what, you’re out of luck, we didn’t deliver in time.”
Winterhoff also said that Lucid expects a limited impact on sales from the loss of the credit due to its market position and pricing.
Lucid views the German luxury brands, including Mercedes, BMW, and Audi, as its primary competitors. Although it does view Tesla as a competitor, “we see ourselves a little bit of a notch higher than Tesla,” Winterhoff said, when comparing the interior, materials, and luxury.
Despite several luxury brands recently pulling back on their electrification plans, like Porsche, Lucid will remain a pure EV company and still believes electrification is the future.
Lucid’s vehicles currently start in the $70,000 to $80,000 range, but the company is working on launching its midsize platform in late 2026, which will bring the price down to around $50,000. The midsize platform will wear at least three “top hats,” including a crossover SUV, a more rugged variant, and a third, rumoured to be a midsize sedan aimed at the Tesla Model 3.
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The Trump administration is seeking to acquire a 10% stake in Nevada’s upcoming lithium mine, operated by Lithium Americas (LAC).
Lithium Americas (LAC) has a flagship lithium mining project, Thacker Pass, located in Nevada.
With the Biden administration, the company had secured a $2.26 billion government loan to advance the project to production. However, since taking office, Trump has been attempting to claw back many loans related to the energy transition.
Last night, reports began to circulate about the Trump administration attempting to renegotiate the terms of the loans to include a 10% stake in the project.
It sent LAC’s stock surging by as much as 80% in after-hours trading.
The reports forced the company to issue a comment. Lithium Americas confirmed being “in discussions” with both the Department of Energy, which issued the loan, and General Motors, which holds a 38% stake in the company and a right to buy the lithium from the mine, about drawing from the loan:
The Company is in discussions with the DOE and General Motors Holdings LLC (“GM”), its joint venture partner in the Thacker Pass lithium project (“Thacker Pass” or the “Project”), regarding first draw on the DOE Loan. The topics of these discussions include certain conditions precedent to draw on the DOE Loan and associated loan specifics, as well as incremental requests from the DOE for potential further conditions to first draw and/or potential amendments to the DOE Loan and associated transaction documents, including corresponding consideration. The Company continues to work with the DOE and GM regarding proposals for a mutually agreeable resolution.
This would be the latest example of the Trump administration taking direct stakes in companies and using “national security” as the reason.
Electrek’s Take
The Biden administration was attempting to establish a North American battery supply chain, but Trump has significantly hindered that effort over the last few months.
However, this is a good move.
The loan would have likely worked as well, but direct ownership is essentially how China operates, and it has worked out quite well for them. There’s a word for this, but Trump’s base hates it.
My main issue with how Trump is doing these market-moving announcements and leaks looks a hell of a lot like insider trading.
Even with this move on LAC, there was suspicious short-term option trading on the stock leading up to this.
The US is in its era of grifters.
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