Data showed that Chinese manufacturers and shippers are ordering a record number of car-carrying vessels to promote EV exports, putting China on track to have the fourth-largest fleet by 2028. Veson Nautical reported that China has the eighth-largest fleet with 33 car-carrying ships. With 283 ships, Japan has the most, followed by Norway with 102, South Korea with 72, and Isle of Man with 61.
Chinese businesses have 47 ships ordered, 25% of global orders. SAIC Motor, Chery Automobile, BYD, and Chinese automakers' shippers COSCO and China Merchants are buyers.
After this armada is delivered to China, the Chinese-controlled car carrier fleet will rise from 2.4% to 8.7%," Veson analyst Andrea de Luca said. "We expect to see new trade routes established almost exclusively for Chinese OEMs (automakers)." Data showed that Chinese shipyards received 82% of global orders as demand increased.
Automakers have expanded into areas where their vehicles cost more than at home due to price-squeezing competition, cost-conscious consumers, and a slow economy. China overtook Japan as the biggest auto exporter last year.
Over 240,000 BYD cars were exported in 2023, 8% of its global sales, and 400,000 are expected this year. Tesla and Volkswagen have boosted export production in China to take advantage of its cheap supply network.
Automakers bought ships due to rising transportation costs and local government help. Shipping firm Clarkson reported that the daily rate to charter a 6,500-vehicle carrier reached $115,000 by 2023, seven times the 2019 average.
However, the export growth has led the U.S. and EU to accuse China of flooding their markets with cheap goods to deal with excess industrial capacity. Focusing on capacity understates innovation and overstates governmental support in growth, according to the government.
Shipbuilding is also at risk of surplus capacity, said Economist Intelligence Unit senior economist Xu Tianchen, who usually blames China. Yet "there remain some niches where the market probably hasn't saturated, such as car cargo ships," he said.
On a four-day trip to China, Treasury Secretary Janet Yellen emphasized overcapacity worries. China's Minister of Commerce Wang Wentao is visiting Europe and may address a European Commission examination into whether Chinese-made EVs receive unfair subsidies.
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