There’s a new trade war brewing – over global dominance in the electric car market
There’s a trade war brewing between China and the West, at stake is who will dominate the global market for electric vehicles.
Outside the port city of Ningbo, Chinese car company Zeekr is rolling out luxury EVs and growing fast. The factory has only been up and running for three years, but this year it’s more than doubling production.
Chinese car company Zeekr is rolling out luxury EVs at its factory near the port city of Ningbo. Pic: Lex Ramsay
Zeekr is a new player in the EV market, but it has unbridled ambition to sell its high-end, high-tech cars abroad. It’s a subsidiary of a state-backed company, Geely.
However, US and EU critics say the financial backing and vast resources of China’s government gives companies like Zeekr an unfair advantage.
In a recent trip to Beijing US treasury secretary Janet Yellen accused China of “overproduction” and “dumping” its EVs on overseas markets. The European Commission has started an investigation into whether to impose punitive tariffs on China’s industry.
But at Zeekr the threat of tariffs is being talked down. The company insists the global market is big enough for everyone.
Zeekr is a new player in the EV market. Pic: Lex Ramsay
Speaking to Sky News at a massive auto show on the outskirts of Beijing, Zeekr vice president Chen Yu explained that when foreign car companies first started setting up EV plants in China, local car companies watched on and learned fast.
“Definitely,” Mr Chen said. “We learned about the performance, the design, the culture, everything.”
Now companies like Zeekr, and BYD which is a giant in the Chinese EV manufacturing market, are taking on traditional car companies.
“I would not say (Chinese EVs) are dominating the market. I would say just they bring more diversity to the local customer, that is the nature of competition as you know,” Mr Chen said.
However, the possibility of Europe slapping tariffs on Chinese EVs is a concern for the Zeekr executive: “Definitely, if the tariff goes up, no doubt we are worried about the potential challenge.”
Mr Zhang, EV owner Pic: Lex Ramsay
On the floor of the auto show, car dealers and importers were clearly impressed with China’s EVs and warned legacy car manufacturers that they are in trouble.
New Zealand car dealer Matthew Foot has been attending the annual show for five years, and said: “It’s going to be very hard to beat China. They get incredible resources from the government; from lithium mines, to the ships and everything in between.
“Obviously you can see why Europe is fearing them and taxing them as well.”
This week US Secretary of State Antony Blinken is in China. Trade tensions are on the agenda, alongside the world’s geo-political crises.
The US already imposes a 27.5% tariff on Chinese cars. But in Europe it’s only 10% and that makes companies like VW, Volvo and BMW increasingly nervous.
In Beijing last week German Chancellor Olaf Scholz said: “It’s clear that we have to talk about questions of overcapacity, and that we have to talk about subsidy competition.”
BYD car at Beijing Auto Show Pic: Lex Ramsay
Germany is in a difficult position. As Europe’s largest car manufacturer, it fears that if the EU slaps tariffs on Chinese cars, China could retaliate by restricting access to its vast market.
But the fact is, more than half of all new electric cars sold worldwide are from China and it can make them cheaper and faster than its competitors.
At the end of last year China’s EV giant, BYD, sold more electric cars than Tesla. Tesla was back on top last quarter, but the competition is fierce.
The scale of production is staggering. BYD owns its mines, battery factories and eight ships.
Even a comparatively smaller company like Zeekr is the model of efficiency, with 2,700 workers churning out around 500 cars a day.
The focus on EVs is part of Chinese President Xi Jinping’s plan to overhaul the country’s debt-driven economy. He calls it “new production forces”. Investing in infrastructure is out, new technology is in.
In the industrial hub of Anhui Province, local officials are also brushing off the looming threat of tariffs. Provincial official Pan Feng said: “Some countries, thinking about their short-term self-interests, introduced some regulations, but I think they are only temporary.
“China is a big country, with a big market, it has huge power and confidence to counteract these conflicts.”
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Chinese buyers are also confident about their country’s electric cars, purchasing more than seven million of them domestically last year.
The country also has more charging stations than anywhere else on the planet.
While charging his BYD electric car in Zhejiang Province, Mr Zhang told us: “Chinese-made cars are good enough for us ordinary Chinese. If you’re thinking of buying an EV, there’s no need to go for a Mercedes or a German EV.”
World
Up to a million Palestinians could be ‘permanently relocated’ to war-torn Libya under US plans
Up to a million Palestinians could be permanently relocated from devastated Gaza to war-torn Libya under plans being worked on by Donald Trump’s administration, NBC News reports.
The idea has been discussed with Libya’s leadership, sources told Sky’s US partner network, and would potentially see billions of dollars in frozen Libyan funds released.
The North African country remains divided in two – nearly 14 years after the overthrow of dictator Muammar Gaddafi sparked a civil war – with two rival governments fighting for control.
It comes as Israel continues a campaign of airstrikes on Gaza, with 93 people killed and hundreds injured on Friday, according to local medics.
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Sky’s team saw bodies arrive at Gaza’s Indonesian Hospital
No final agreement on any Libya plans have been reached, sources told NBC News, and US government agencies did not respond to requests for comment from the news outlet.
Previous suggestions to resettle Palestinians from Gaza – voluntarily or otherwise – have provoked international outcry, particularly from Arab states who likely will play a role in rebuilding the enclave after any permanent ceasefire deal.
And Libya is far from a safe nation, according to the US State Department’s own travel advice, which says Americans should not travel to the country “due to crime, terrorism, unexploded landmines, civil unrest, kidnapping, and armed conflict”.
President Trump, speaking on the final day of his Middle East trip, said he was looking to resolve a range of global crises, including Gaza.
“We’re looking at Gaza,” he said. “And we’ve got to get that taken care of. A lot of people are starving. A lot of people are – there’s a lot of bad things going on.”
An Israeli tank nears the border with Gaza. Pic: Reuters
There had been hopes that his tour of the region could increase the chances of a ceasefire deal or prompt Israel to lift its blockade of Gaza that is preventing humanitarian aid from getting in.
But instead Israel has continued to launch airstrikes on the territory, killing more than 250 people in the last two days, according to Hamas-run health authorities.
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The Israeli military, which had dropped leaflets on the northern town of Beit Lahia ordering residents to leave, said their airforce had struck more than 150 military targets across Gaza in recent days.
This week, Israel said it had bombed the European Hospital because it was home to an underground Hamas base, but Sky News analysis has cast doubt on its evidence.
Israeli officials said the latest strikes were a prelude to a larger military campaign in Gaza aimed at pressuring Hamas to release hostages.
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Trump wraps up Middle East tour
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Ahmed Abu Riziq, founder of the Gaza Great Minds Foundation, which seeks to give children access to education in Gaza, said “the hell doors opened” in the last few days.
Speaking to Sky News from Gaza City, he said: “Myself with my family, we had to flee today from some certain areas in northern Gaza City… people are running in the streets. They don’t know where to go or where to sleep at night. So it’s really catastrophic.”
“No food is entering Gaza,” he added, saying that people are dying from hunger.
Prime Minister Benjamin Netanyahu said this month that Israel plans to seize all of Gaza and hold it indefinitely.
Tom Fletcher, head of the UN office for the coordination of humanitarian affairs, warned the Security Council this week it must “act now” to “prevent genocide” – a claim Israel vehemently denies.
Russia and Ukraine failed to agree to a ceasefire in their first direct talks since 2022 – as European leaders called Moscow’s approach “unacceptable” after the discussions lasted less than two hours and Vladimir Putin stayed away.
The meeting in Istanbul, Turkey, was set up at short notice on President Putin‘s behest, but he declined a challenge from Volodymyr Zelenskyy to meet him in person and instead sent relatively junior representatives.
A source in the Ukrainian team told Sky News that Russia had threatened “eternal war” during the talks.
They said the Russians were not ready to talk about technical details of a ceasefire and were waiting for superiors to approve them.
Latest updates on Istanbul talks
Turkish foreign minister Hakan Fidan chairs a meeting between Ukrainian and Russian negotiators in Istanbul. Pic: Reuters
Both countries said they had agreed to trade 1,000 prisoners of war each in what would be the biggest such exchange yet of the conflict.
But Kyiv wants the West to impose tighter sanctions unless Moscow accepts a proposal from Donald Trump for a 30-day ceasefire.
President Zelenskyy said after the meeting that he had spoken to Mr Trump by phone – alongside Sir Keir Starmer and the leaders of France, Germany and Poland – who all met in Albania on Friday.
In a post on X, he said Ukraine was “ready to take the fastest possible steps to bring real peace” and that “tough sanctions must follow” if Russia continues to resist a month-long truce.
The Ukrainian delegation. Pic: Reuters
The Russian delegation. Pic: Reuters
Frustration over Russia‘s perceived stalling in holding serious negotiations was also clear from the European leaders gathered in Tirana.
“The Russian position is clearly unacceptable, and not for the first time,” said Sir Keir.
“So as a result of that meeting with President Zelenskyy and that call with President Trump we are now closely aligning our responses and will continue to do so.”
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The talks were held in Dolmabache Palace in Istanbul. Pic: AP
The UK prime minister said the no-show by Russia’s leader was “more evidence that Putin is not serious about peace” and has “been dragging his heels”.
NATO secretary-general Mark Rutte, who was also in Albania, said President Putin had made a “big mistake” by sending low-level delegates to Istanbul.
A list of representatives ahead of the meeting listed presidential aide Vladimir Medinsky, deputy foreign minister Galuzin Mikhail Yuryevich and deputy defence chief Alexander Fomin.
Ukraine’s delegation was led by defence minister Rustem Umerov.
President Zelenskyy had called the Russian team “a theatre prop” ahead of the summit in the Dolmabahce Palace.
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Ukrainian ‘despair’ over missing civilians
However, Turkey’s foreign minister heralded it as “an important day for world peace” and said Russia and Ukraine had agreed to swap 1,000 POWs each as a “confidence-building measure”.
Hakan Fidan shared a picture of the delegations and said they had “agreed to share with the other side in writing the conditions that would make it possible to reach a ceasefire”.
Russia’s Vladimir Medinsky said his team had “taken note” of the Ukrainian request for direct talks between Mr Putin and Mr Zelenskyy.
“We have agreed that each side will present its vision of a possible future ceasefire and spell it out in detail,” said Mr Medinsky.
Hopes ahead of the meeting were low after Mr Trump and his secretary of state, Marco Rubio, played down the prospect of meaningful progress.
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Trump on meeting Putin: ‘As soon as we can set it up’
The US president told reporters on Air Force One on Thursday “nothing’s going to happen until Putin and I get together”, while Mr Rubio said a “breakthrough” was unlikely until the US and Russian presidents meet.
No date for such a meeting has been proposed, but Mr Trump has said it will happen “as soon as we can set it up”.
Kremlin spokesman Dmitry Peskov told reporters that top-level talks were “certainly needed” but arranging it would take time.
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Russian foreign minister Sergei Lavrov was a notable absentee, despite attending Ukraine-focused talks with the US in Saudi Arabia in February.
Russia has so far failed to agree to a 30-day unconditional ceasefire – proposed by European leaders who have threatened Moscow with “massive” sanctions if it doesn’t sign up. The US also supports the plan.
The Kremlin has ambitions to keep swathes of Ukrainian land as part of any long-term truce, an idea that Kyiv firmly rejects.
Russia also wants an end to Ukraine’s NATO ambitions and a promise it will stay neutral.
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