Understanding the Emergence of Chinese New Energy Carmakers – the Perspective of Production Model

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Résumé:

Purpose
This paper aims to examine the emergence of Chinese carmakers in the global NEV (new energy vehicles) market through the lens of production models (Freyssenet and Boyer, 2002), that intersect between schools of institutional economy, economy of regulation, sociology of work and organization, and technology innovation.

Design
Our study conducts a comprehensive literature review of production models and utilizes secondary data on NEVs and conventional vehicles in China. We scrutinize the evolving sales dynamics of NEVs and Internal Combustion Engine (ICE) vehicles among Chinese automakers and their international counterparts within China, as well as their performance in global exports. Employing the framework of production models, we elucidate the developmental trajectory of NEVs in China

Findings
We observe that the competitive viability of Chinese NEVs carmakers results from the joint endeavors of the government, industry stakeholders (including established car manufacturers, suppliers, and emerging players within the ecosystem), and the substantial market size. The emerging Chinese production model is facilitated through governmental initiatives such as industrial policies and strategic resource access (materials for battery for example). Interestingly, recent trends highlight the increasing influence of Chinese consumers and their interactions with automakers, indicating a shift where consumer dynamics are assuming a role of equal importance alongside other factors.

Practical and theoretical implications
We propose an updated production model (Boyer and Freyssenet, 2001) that integrates institutional arrangements, company production models, and path dependencies for technological change. This revised model acknowledges the significance of critical natural resources and places increased emphasis on consumer behavior, particularly in the digital economy era where Generation Z comprises digital natives. Moreover, we recognize the pivotal role of geopolitical factors in the institutional landscape (Jetin 2020).

This essay illustrates China's trajectory toward electrification, presenting a Chinese production model within the NEV sector that embraces the CASE (Connected, Autonomous, Shared, Electric) paradigm.

Furthermore, this paper analyzes the implications for global carmakers, partially addressing the question of whether "dinosaurs will keep ruling the auto industry" (MacDuffie and Fujimoto 2010).