China EV Problem & Battery Breakthroughs by CATL

Summary

Podcast Summary: China EV Problem & Battery Breakthroughs by CATL

Everything Electric Podcast – The Fully Charged Show
Host: Robert Llewellyn | Guest: Elliot Richards
Date: May 4, 2026

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Overview

This episode of the Everything Electric Podcast was recorded live from Auto Beijing, the world’s largest auto show, with host Robert Llewellyn and China-based correspondent Elliot Richards. The discussion focused on three main themes:

• The pivotal role of CATL in global battery innovation
• The current and future state of China’s EV market
• Trends and surprises at the Beijing Auto Show

Expect clear-eyed insights, wit, and grounded takes on electrification, battery tech, industry shakeouts, and the real challenges facing both Chinese and international carmakers.

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Key Discussion Points & Insights

1. The Dominance and Innovation of CATL

[05:15 – 13:48]

• Who and What is CATL?
  CATL (Contemporary Amperex Technology Limited) is the world's largest EV battery maker, responsible for 39% of all global battery electric vehicle (BEV) batteries ([05:15]). Their batteries are in one out of every two cars sold in China ([09:25]) and power vehicles from Tesla, BMW, and many others worldwide.

• Why Has CATL Succeeded?

  • Pioneered batteries initially for phones, then leveraged the Chinese government’s Made in China 2025 strategy and subsidies ([06:42]).
  • Deeply engineering-led culture — “everyone in that company is an engineer” ([06:42]).
  • R&D powerhouse: 120,000 researchers, thousands with PhDs ([06:42]).
  • Relentless innovation, fast scaling, and vertical integration.

• Breakthrough Announcements from CATL:
  a) Shenshing Battery (Shenshing 3):

  • Super fast charging: 10% to 80% in 3 minutes; 10% to 98% in under 7 minutes; even at -30°C, charging to 80% in 9 minutes ([09:25]).
  • After 1,000 cycles, retains 90% battery health.
  • “I've never been in a press conference...where they started showing equations. It just shows you how engineer focused they are.” – Elliot, [11:09]

  b) Battery Weight Reduction:

  • 3rd Gen Qilin battery: 280 Wh/kg; enables a 600 kg battery for 125 kWh (saving 200 kg vs. old tech) ([12:09]).
  • This reduction addresses vehicle weight, handling, longevity, and regulatory pressures on heavy EVs (Norway, France).

  c) Condensed Battery Tech:

  • Aircraft battery innovation filtered down: now 350 Wh/kg, enabling up to 1,000 km CLTC range in cars ([13:12]).
  • “If anyone’s going to make short-haul aviation possible, it will be CATL” – Robert, [13:48]

  d) Sodium-ion Batteries:

  • CATL’s sodium-ion battery with Changan going to mass production Q4 2026 ([15:15]).
  • Affordable, works in extreme cold, ~400–500 km range.
  • “It will just bring down the price of electric cars. ...I think it’s kind of a, not a Trojan horse, but I don't think people realize the impact that battery is going to have.” – Elliot, [15:15]

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2. China’s EV Market: Crisis or World Conquest?

[16:10 – 26:05]

• Media Perception vs. Reality:
  The Western narrative swings wildly between “China’s EV industry is in crisis” and “China is about to dominate the world.” The truth, say Elliot and Robert, is much more nuanced.

• Competition, Copycats, and Panic:
  “There's a fear in this market because overseas expansions haven't gone well for everyone... and back home here there's the price wars. So things are getting so competitive now.” – Elliot, [18:41]

  • Automakers are risk-averse, producing copycat SUVs and Xiaomi-style sedans instead of innovative models.
  • Herd mentality among Chinese and international brands: “They just chase the herd mentality.” – Robert, [21:07]
  • Smart, Citroen, and Xiaomi are among the few taking design risks ([20:55]).

• Sales Slowdown and Market Overcapacity:

  • Domestic EV sales down, with BYD year-on-year halved (from 600k to 300k a month) despite still being huge numbers ([25:08]).
  • Blunt prognosis: “No one’s safe. ...We will see some casualties for sure.” – Elliot, [22:57]
  • Legacy foreign automakers struggle to adapt: e.g., Honda closing Chinese plants, Toyota and VW adapting via local partnerships ([24:11]).

• Economic Pressures:

  • Chinese economy showing signs of tightening: people staying in jobs longer, spending and car sales dropping ([25:08]).

• Consolidation Inevitable:

  • “It’s musical chairs and there are only so many seats to go around and the music’s about [to stop]... early next year I think we are going to see some casualties.” – Robert, [36:24]

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3. Themes & Highlights from Auto Beijing 2026

[26:05 – 33:39]

• Upsizing and ‘Bloat’:

  • Contrary to previous years’ focus on compact/affordable EVs, the show is full of enormous three-row SUVs and cars touting up to 1,800 km of range ([18:41], [27:02]).
  • “All you see is three-row SUVs and sedans which look like Xiaomis.” – Elliot, [18:41]
  • “If the car industry advertises bigger cars because it can mean more metal, can mean more margin...” – Robert, [28:12]

• Affordable Cars Scarce:

  • Only two small cars among 1,450 vehicles at the show: automakers now avoid low-margin small EVs and overprice ‘premium’ products ([27:27], [29:51]).
  • “If that's the only product that people can buy now, then what can you do? That's the only choice.” – Elliot, [29:51]

• Standouts & Duds:

  • The Smart #2 is the rare bold, compact EV; otherwise, “there hasn't been much which stands out… Some inspiration is running dry.” – Elliot, [29:51]
  • Freelander concept is notable but continues the SUV trend.
  • Brand struggles: Japanese automakers – “They’re too stubborn to change... it’s going to hurt them long term.” – Elliot, [36:07]

• Western Brands Adapting:

  • VW collaborates with Xpeng; BMW and Audi try “Chinese market only” strategies and Huawei integration, with mixed success ([24:11], [32:19]).
  • Polestar, despite global success, flounders in China as “too European, not enough tech” ([32:19]).
  • “It's very hard to keep a clear head... How do we plot our way through what is an incredibly difficult period of time?” – Robert, [34:20]

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4. Notable Quotes & Memorable Moments

• “If you haven't heard the innovation has come from CATL, then it’s probably not a real innovation.”

  • Elliot Richards, [06:42]

• “These are now batteries which, it takes the same amount of time to fill up a petrol car.”

  • Elliot Richards, [10:00]

• “No one’s safe. ...We will see some casualties for sure.”

  • Elliot Richards, [22:57]

• “The car industry is quite competitive right now and it'll be really interesting to see how it plays out."

  • Robert Llewellyn, [37:02]

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5. Winners and Losers at Auto Beijing 2026

[35:24 – 37:02]

• Winners:

  • CATL: “Definitely CATL.” (ubiquity and technical dominance) ([35:24])
  • Huawei: “They’re just dominating the market” with their tech appearing in both Chinese and legacy OEM vehicles ([35:24])
  • Cherry: “I went to a Cherry press event yesterday... 4,000 press there, just for their press event. I’ve never seen anything quite like it.” – Robert, [35:37]

• Losers:

  • Japanese Automakers: “They’re too stubborn to change...it’s going to hurt them long term.” – Elliot, [36:07]
  • Polestar (in China): “...just seen as too European. Not enough tech, not enough voice integration.” – Elliot, [32:19]

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Key Timestamps

• [05:15] – What is CATL and how did it get so big?
• [09:25] – CATL’s latest press conference and tech announcements
• [10:00] – Super-fast charging breakthrough: “same as petrol fill-up time”
• [11:35] – CATL tackling vehicle/battery weight; industry ramifications
• [13:12] – Next-gen condensed battery/energy density
• [15:15] – Sodium-ion battery and potential impact
• [18:41] – State of the Chinese market: fear, copycatting, price wars
• [22:57] – Market shakeout and who’s at risk
• [25:08] – Chinese economy: tightening, BYD sales drop
• [27:02] – Shift to supersized, feature-rich EVs (away from affordable compacts)
• [29:51] – Lack of affordable options, Smart #2 as standout
• [32:19] – Why Polestar and Audi struggle in China
• [35:24] – Who’s winning/losing at the show: CATL, Huawei, Japanese brands

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Conclusion

This episode provides an unvarnished look at the Chinese EV industry’s strengths (CATL’s world-leading breakthroughs), acute industry anxieties (price wars, economic slowdown, consolidation), and the paradoxes at Auto Beijing (booming show, but innovation bottlenecks and upmarket “bloat”). It’s a critical listen for anyone tracking the global shift to electrification—and pondering who will still be standing at next year’s Beijing show.

Transcript

[Robert Llewellyn]

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[Elliot Richards]

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[Robert Llewellyn]

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[Elliot Richards]

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[Robert Llewellyn]

Make it when you visit 1-800-FLowers.com podcast, that's 1-800-FLowers.COM podcast. Foreign. To the Pulse podcast on everything electric cars. It's a life and death decade for the automotive industry. And on this podcast, for once, it's me hosting and I do apologize profusely for that. Normally you have the lovely dulcet tones of Imogen Bogle and even once Robert Llewellyn, but today it's me. And there's a reason for that, because I'm actually in Beijing at Auto Beijing with the fantastic Elliot Richards, who almost all of you will be familiar with. Elliot's been our Chinese based correspondent for many years now, talking to us about everything that's going on in China. And you cannot talk about the automotive industry these days without talking about China. So we're here at Auto Beijing to have a look around and today's podcast is going to be all about the themes that are emerging from this show. Hello Elliot, how are you?

[Elliot Richards]

I'm very good, thank you. How are you?

[Robert Llewellyn]

I'm good, I'm good. It's very surreal to be here with you and also where we are right now. Do you want to tell people where we are sat at this precise moment?

[Elliot Richards]

Yeah. So for those of you, I guess, who are listening to this, we're actually sat on the catl stand within an EVTOL aircraft by auto flight. So we're in the back seats, very comfortable. And our cameraman's sitting in the pilot

[Robert Llewellyn]

seat and there's two seats behind us as well. So we're saying this is a perfect vehicle for Elliot and his, his wife and three children might be a bit Pricey, I suspect. But the reality is we're here at Auto Beijing, so if there's some background noise and you are listening into this, I do apologize. We've obviously done our best to find a relatively soundproof place to conduct this podcast. We're here inside this very sort of futuristic vehicle talking about the show and how are you more generally, how is life treating you? And it's just a whirlwind time to be here covering this subject, right?

[Elliot Richards]

Yeah, absolutely. I mean, things change so much and so fast in this industry that it's actually very hard to keep up. And a show like this is so overwhelming. Like the size of this show. This is the biggest, biggest show that's ever happened in China. The biggest auto show in the world is 380,000 square meters of space. It's 1.3 kilometers from end to end, as we both experienced yesterday. And there's a lot of themes that I think are coming out from today. I think we'll discuss that later. But yeah, it's changed a lot since the last time you guys were here and then since 2023 when trying to open back up after Covid. Huge changes in the industry. But I think the first thing, the most important thing for us to talk about is Catl. Right. Because that's for me the anchor behind all of the innovation and all of the cars here is, is what's happening on this stand. That's why we, you know, we started the auto show walk around video with Catl and we're filming here right now.

[Robert Llewellyn]

So we're going to talk about Catl. I think that you're right. I think that's incredibly important part of everything that's going on in the market. We're also going to talk a little bit about China where the market really is. Lots of different conjecture online. Is it collapsing? Is it thriving? Is it going to take over the the world? We're going to talk about that and then we're going to talk a bit about the show highlights as well. I agree this show is so big, it's been a bit of a blur. So we're actually talking at the beginning of day two, once we've had a bit of time to process everything that we've seen. So we'll get into those themes shortly. But for now, a quick advertising break.

[Elliot Richards]

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[Robert Llewellyn]

Okay, so let's cut straight to the chase. Catl, yes, is a company that if you're in the industry, you'll almost certainly have heard of, but for the average person out there, you might be unaware of who they are and what they do. I really like the acronym CATL because the longer form name is.

[Elliot Richards]

Is it Contemporary Amperex Technology Limited?

[Robert Llewellyn]

Bit of a mouthful. So CATL is the, is the brand and actually in complete transparency. We're here this week as a result of catls kindly helping us to come out and be at this show. And actually it's the best company, I think, for us to, to come with because they are integrating their tech into pretty much everything. So one of the things that's always fascinated me about the rise of silicon was the intel inside processors that actually made the whole thing work. And here we've got another ingredient brand in CATL which is doing fundamentally the same thing, not just for electric cars, but for electric tech of all shapes and sizes. And the interesting thing is CATL might not be a household name yet, but I've got a feeling like intel, it will be in the not too distant future. And a quick fact before I start asking Elliot questions is that of the batteries made for battery EVs around the world, CATL are making 39% of them. That's right, EYD a second with just over 16%. So between those two Chinese behemoths, they're actually producing well over half the batteries. But CATL, 4 out of 10 battery electric vehicles are basically carrying their batteries, which is extraordinary and the tech is amazing, which we'll get into. But tell us a bit about the success story. How has this been possible for this company to come about and to suddenly be dominating the landscape to this extent?

[Elliot Richards]

I mean, there's a multitude of reasons and I think they were one of the earliest ones to develop batteries in China. So they started developing batteries for things like Nokia phones. I think that was Seattle. And they're engineers, right? So everyone in that company is an engineer. So Robin Jiang, the CEO, he is an engineer by trade by tarte. So it's a very engineer led company. And so they've been able to really build up their battery expertise, you know, with gadget, with phones, with other things. And then when China's Made in China 2025 strategy came in to place in 2015, that gave them the motivation, you know, they had subsidies, they had many benefits from the Chinese government in order to then develop for. For automotive in a big way. So they suddenly had a huge customer base of all of the Chinese OEMs who were like, well, we need batteries. Where do we go? It's more BYD or catl. And so that really spurred on their innovation. And then they invested heavily into research. I think they got something, 120,000 researchers working for their company. And I think something like, I can't remember the numbers, I'm going to get it wrong. But a few thousand of those have PhDs. You know, they're doing so much research into the latest and greatest battery tech that if you haven't heard the innovation has come from Catl, then it's probably not a real innovation. So we spoke about Donut Labs, for example. You know, the jury's still out how legitimate that is, but if they're saying they can do it, I'm like, well, why hasn't Catl been able to do it with their thousands of people researching? So for me, that's why this company is so important.

[Robert Llewellyn]

They're at the cutting edge, but they're already, as I said, in so many different cars. And actually there's a fantastic thing on the stand which I'll share on my LinkedIn account, which is actually, it's kind of a Rolodex of all the cars that they're in and you flashes through a whole range of different cars. And actually I would consider myself a EV expert. And there were a whole bunch of cars from Chinese manufacturers that I was unaware of, which really surprised me, I think. I'm not even sure we'll do the test later. I'm not even sure Elliot would know all of them. So many. But for those listening in the west, it's important to say that Seattle is supplying Tesla, I think BMW. Many other Western automakers are getting their batteries from Catl as well. And I think from my perspective, they've just started to make a few more announcements as they do. And it can be a little bit easy to become, I guess, complacent about all the announcements coming out of China. But the latest stuff again is another re raising of the bar. BYD and Geely. And Catl. All these companies seem to be sort of competing with each other. But Catl's recent announcement. Take things a step further. Can you kind of unpack a few of the different announcements that have come out recently, if you can remember them?

[Elliot Richards]

Yeah, I've got my notes because. So I went to the press conference, couple of Days ago and it was, you know, every time I go to these conferences you learn something new about what's going on with the company. So now one in every two cars sold in China has a CATL battery inside. So I think it's 47%. So that's very impressive straight away. But their new battery technologies, there's one called the Shen Shing battery, they've just announced the shenshing 3. So now this comes with super fast charging. So 10 to 80% in 3 minutes, 10 to 90 AE 8% is 6 minutes and 27 seconds.

[Robert Llewellyn]

That's just mind blowing. Just that alone, yeah.

[Elliot Richards]

And then even in minus 30 it only takes nine minutes. So you know, we've heard the announcements from BYD with their flash charging. VCATL have their own kind of similar developments, but these are now batteries which it takes the same amount of time to fill up a petrol car. And I think that's what is going to happen in the next kind of two years is the rollout of this, you know, super fast flash charging, you know, high discharge rate charging. And for those cars to be able to enjoy those benefits, they all have to upgrade to 800 volt architecture, 900 volt architecture, thousand volt architecture, and all underpinned by, by the batteries. So Shenshing was one announcement. So the super fast charging and the battery health for those batteries after a thousand charges still remains at 90%. In the press conference they started showing equations. I've never been in a press conference. It's all like flash images, like lifestyle images, but in there they said this is the equation like and it was. I had no idea what they were talking about at that point, but I

[Robert Llewellyn]

think they're fairly confident that someone who works on YouTube can't take a screenshot.

[Elliot Richards]

Definitely not. Definitely not. It just shows you how engineer focused they are. I mean no other company would be brave enough to show equations on the screen during a press conference. For me, the most interesting one is around weight. So for the first time ever I've heard a company say, you know, weight is an issue. You know, these cars now have or customers demand cars with 1000km of EV range or whatever it might be.

[Robert Llewellyn]

I think we might talk about weighing size later in this.

[Elliot Richards]

Yeah, that's right. But they said, well if we reduce the size of the weight of the battery and give the same amount of range, then it's going to benefit the handling, the brakes, the lifetime of the bearings, the bushings and everything else by up to like 30 or 40%. So also it's A response to what's happening in Norway and France. They're very conscious of the weight limitations coming in for cars. So they've got their Qilin third generation battery, which is an NCM battery.

[Robert Llewellyn]

Starts with a Q. Chilling.

[Elliot Richards]

Yeah, yeah, yeah. With the queue. And that has 280 watt hours per kilogram. So it's pretty high. But it means the battery for 125 kilowatt battery is 600 kilograms instead of 850 kilograms for a LFP battery. So they've shaved off 200 kilograms from that battery. Now it might not sound like much, but if they're moving in that direction, will we get the 400 kilogram battery? You know, we're heading towards that much better place where batteries don't become so much of a burden and you can get these amazing ranges. But if you have flash charging then do you need a car with a huge battery and so much rain? So it's, you know, there's so much happening. What's going to be, which part of the industry is going to grow quicker? Will it be the weight of the batteries or will it be the fast charging or will it be a combination of both? So that was very, very exciting for me to hear someone talking about weight. And then the other one is the, they've got this condensed battery now, so using their aircraft technology in their battery. So I think last year they announced the 500 watt hour per kilogram aircraft battery. So they've condensed that now to a 350 watt hour per kilogram battery. Which now means they can get a thousand kilometers from an EV like or CLTC range, but 800 kilometers maybe from a battery. So because we've seen from this show, the cars seem to be getting larger and larger and larger and bigger and bigger. I think having lighter batteries which have much more, which are much more energy dense will really help the industry try and reduce its weight in general.

[Robert Llewellyn]

And obviously this podcast is going on everything electric cars, but fundamentally CATL is integrating battery tech into all types of transport and other technologies as well. But we're, we're sat here in a vertical takeover landing vehicle. But it's, you know, it's the marine industry. I think if anyone's going to make short haul aviation possible, it will be catl. So this has got huge kind of, very, very kind of transport industry wide ramifications. But the interesting thing is I think that a lot of the narrative around EVs is driven by fear and ignorance.

[Elliot Richards]

Yes.

[Robert Llewellyn]

And so all decision makers are probably underestimating some things. And overestimating other things. I think that's fascinating that you get these kind of super long range batteries, they can charge really fast but at the moment a lot of focus is downstream is people putting a lot of charging in the ground that maybe is slower, maybe putting in the wrong type of charging, maybe we'll end up with too much charging. Because suddenly actually if you can charge very, very quickly and the battery range is much longer, that's going to change that equation to such an extent. So that's my fear. Sometimes with misinformation and the fear that's out there, actually it's not enabling us to, to plan properly. I think we could end up with a lot of sunk assets that actually we didn't need in the, in the long run. So anything else? Because I, I'm quite interested, I'm fascinated always by sodium.

[Elliot Richards]

Oh yeah, yeah, yeah.

[Robert Llewellyn]

The Nextra battery is there.

[Elliot Richards]

That's right.

[Robert Llewellyn]

The sodium version. That's showing great promise as well.

[Elliot Richards]

Yeah. So the, we went to the far north of China to see the natural battery in, it was minus 30 outside. It was horrendous. But they were releasing their new sodium ion battery with Changan and they're putting in one of their more affordable sedans, like a fairly plain sedan and they announced that that will be going to mass production in Q4 of this year. So slightly later than we originally thought. But that is really game changing tech. Yes, the range isn't quite so high, something 400-500km at the moment, but it can work in icy cold conditions. It's so much cheaper, so much more affordable that it will just bring down the price of electric cars. So that for me I can't wait to actually see that come onto the market and see what impact that has. I think it's kind of a, not a Trojan horse, but I don't think people realize the impact that battery is going to have.

[Robert Llewellyn]

Well, I think again that's another part of the equation that people are perhaps underestimating is the degree to which the Chinese manufacturers have built themselves around sort of vertical integration around the supply chain, cost down advantages that's going to give them if they get to sodium ion at scale, at speed, that's gonna make cars even more cheaply and give legacy OEMs even more of a headache. So it's really, really interesting. But I think sodium ion is great because. Because we don't want to be just solely reliant on lithium. For example. LFP has obviously been a huge boom. The developments that are going on now are fantastic. And this is just part of an ongoing change. I mean, where we will be another two or three or four or five years. I really cannot even begin to fathom it, the speed at which companies like Catl are developing the marketplace. So even though I think we're a bit ahead of the kind of the mainstream media and what's out there in the market, I think there'll be discussions going on within Seattle, other companies that would probably blow our tiny mind. Where are we going to take this? And I don't know, maybe I can play a role perhaps in advancing these equations and moving things forward even faster. So Seattle for us is a really fascinating story. We'll keep telling that for sure. We could talk about it, I suspect for hours. Let's move on to the second topic now. You don't consume a lot of Western media because you live here in China. You live in Shanghai specifically. You're not probably consuming too much Chinese media either, which makes you kind of an interesting kind of canvas on which to sort of paint this discussion. But back at home, it is now clear you go on LinkedIn as one platform, for example, you go on YouTube. It's very clear that people have woken up to the fact that something very seismic is going on in China. It's going to have a huge impact on the world. It's mostly all technologies, but obviously vehicles are going to be a big part of that. And cars are hugely exciting, aspirational topic. So there's loads of posts now on LinkedIn, loads of videos on YouTube, loads of podcasts about this subject. It's suddenly become the talk of the town, but it kind of oscillates between China's in crisis, they've got too much supply, all the businesses are consolidated, they're going to go out of business and China is going to take over the world. Obviously, the world's much more nuanced than that. What are you seeing? Is there a sense of panic here? A sense of pride? What is actually going on in the Chinese market?

[Elliot Richards]

If you can summarize it, how long do we have? This episode is brought to you by. Hong Kong. The Hong Kong Ion Tire is built exclusively for electric vehicles, engineered to deliver what EV drivers need most confident grip, quietness, energy efficiency and long mileage. As the official tyre partner of Formula E, Hank Hook, proves its EV technology is at the highest level of performance and brings that same innovation to every ion tyre on the road. Yes, I think for me, I was trying to think about this last night. There has been a huge shift in what we're seeing here today, right, we're seeing a lot more SUVs, a lot more people talking about huge ranges like the Smart 6 sedan. It's got 1,800km of range. Why do you need that much range in a, in a, in a sedan? I think there is a fear in this market because overseas expansions haven't gone well for everyone. You know, we've seen some automakers not doing very well in Europe and other markets. And back home here there's the price wars. So things are getting so competitive now. So what's happened is these automakers have responded by saying, well, we know like the Xiaomi sells really well, so let's just do a Xiaomi copy. We know big three row SUV's with hybrid powertrains in them are also selling really well, so we'll just do that. So if you go in some of these halls now, so all you see is three row SUV's and sedans which look like Xiaomis. And there's kind of this fear that no one really wants to take a risk with anything anymore. There's no real stat, there's a couple of interesting cars here, but there's nothing real which really stands out. And I think that's because the, the automakers here are scared. They've got price wars at home. Things are not selling very well in overseas markets. So they just revert to this kind of, kind of blob SUV kind of type. And that's showing that they're not confident. The only automakers who are taking risks at the moment is Smart with a hashtag too. Who knows if that will sell. Citroen are doing some interesting concepts, whether they sell very well. And that's really about it.

[Robert Llewellyn]

Xiaomi have made quite a lot of progress.

[Elliot Richards]

Xiaomi have made a little bit.

[Robert Llewellyn]

Their vehicles look a little bit different. They do out of the tech world. It kind of feels like that.

[Elliot Richards]

Yeah.

[Robert Llewellyn]

Stylistically they look, look a little bit different, but you could say they look a bit like Porsche.

[Elliot Richards]

Yeah, absolutely.

[Robert Llewellyn]

I mean, there's no such thing, unfortunately, as an original idea, as much as we might fool ourselves into thinking that. But what's really interesting for me is to see these big beasts, whether it's Chinese companies or legacy automakers, adopt this herd mentality. They just chase the herd mentality. The political pendulum swings towards EV at one point, maybe back towards hybrids in more recent times will swing inevitably back towards battery EVs, because that is the better technology. If you're coming on this podcast, you might not be surprised to hear me say that. But there are a whole range of ways in which it's better. We think it will win out, it's just a matter of when. So I'm just sort of fascinated by the competition in China because coming to this show, I think we'll talk about some of the specific highlights, but thematically I think you're right. It doesn't feel it's bigger than the Shanghai show. So that belies the rumors that the Chinese car industry is on the floor, but it doesn't seem quite as distinct to me. There does seem to be some copycatting going on, some herd mentality going on. But how many sales are there? Not just in the Chinese domestic market, which is huge, but globally, to go around amongst all of the automakers, new and old, that they just aren't enough. That is an inescapable reality. Year of the fire horse, isn't it? That's right here in China, which is a year which kind of augurs big things happening potentially. It feels like that consolidation piece feels like everyone sort of got themselves here to Beijing. It feels like the second half of

[Elliot Richards]

the year could be potentially spicy.

[Robert Llewellyn]

Spicy, That's a very, very good word for it. Are there any. Are there any companies you. You fear for more than. Than others?

[Elliot Richards]

I would say. No one's safe. No one is safe. I mean, you look at so Geely, for example, closed down their Jidu car brand after, what's it, two or three years. They. Cars on the streets, you know, they were, they were pushing it hard and now it's gone. And they didn't save the Cup. Their own company, they didn't save it. It's hard to pinpoint any automakers who are really struggling. Obviously the legacy automakers are. Some are doing better than others. You know, some of the Japanese ones are responding in the Chinese market. So Toyota's got five evs on their stand. China market only. Right. Is it enough? Maybe not. Honda, for example, they just closed the factory, I think last week in China because they don't sell ICE vehicles anymore in China. So yet legacy brands, the more agile legacy brands like vw, they've built and designed a car with Xpeng in China for China. It looks fabulous. It looks really high tech. Good software. Is that the answer? I don't know. We'll. Time will tell. Right, but it seemed to have a very good reception. I mean, with the Chinese automakers, the jury's still out. I think you're going to see definitely consolidation with. With some of those. You still got the Biggest state run companies like saic, they'll start swallowing up some of the brands, but we will see some casualties for sure.

[Robert Llewellyn]

And you can't ignore the macro at the moment. There is still conflict in the Middle east, there's still the Chinese economy to consider as well. These things aren't divorced from each other. You know, excusing the pun, but the Chinese economy has been a strong engine within which to kind of launch this armada of different EV brands. But if the economy actually is weakening as well, that's also problematic. So putting Iran and the cost of fuel to one side, because that definitely strengthens the case for battery EVs. How is the Chinese economy in general terms? I imagine it's quite opaque here.

[Elliot Richards]

Yeah.

[Robert Llewellyn]

And you know, statistics can be skewed and we see statistical economics played out in UK media, American media, etc. And even then numbers can be, yes, you know, shown up in a certain light. But I imagine here you're just not getting that level of transparency in what's going on with the wider economy. What's the, what's the vibe, I guess here.

[Elliot Richards]

Yeah, so I can't give you any numbers, but the sense here is that things are tightening. So for example, people are staying in their jobs for longer, they're not changing their jobs as a result, they're spending less, they have less disposable income, so they're not buying as many cars. So for example, BYD sales year over year are down 50%. 50%. They're selling 600,000amonth last year, now they're only selling 300,000amonth. But still a huge number, but is a significant drop for byd. And BYD has affordable models here for, you know, a few thousand pounds. So if they're hurting then, then there's definitely problems. Right.

[Robert Llewellyn]

I mean there just has to be a shakeout, isn't there? Globally, not just here in China, because there are just so many brands trying to attack the market and I guess how long can brands suffer for?

[Elliot Richards]

Exactly.

[Robert Llewellyn]

And does consolidation actually, is it actually potentially a good news story?

[Elliot Richards]

Yes.

[Robert Llewellyn]

In the medium term, I wonder how long the industry can defy gravity in the way that it has been doing so. So again, a topic that we can't really do full justice to, but we thought we would get Elliot to talk about what's going on here in China with the car companies and the wider economy. But just then to focus on our third topic, which actually is this, this show. You alluded to it earlier and I can feel it too, this kind of real Move towards some slightly blobbier. Well, a lot of really big vehicles. Right. I seem to remember from Shanghai last year, lots of smaller, more affordable EVs.

[Elliot Richards]

Yes.

[Robert Llewellyn]

Cars about which our audience typically gets quite excited because it's about the democratization of transport, maybe cheaper vehicles, maybe you don't need to lug around a big battery, particularly for you got a second car or maybe you don't do much mileage. But here it does seem like we're seeing a lot of very, very large cars launching. What's that telling us?

[Elliot Richards]

So I think it's two things. One is the car companies are scared so they're just reverting to what they think buyers want and they think buyers want everything. So I want a car with eight seats, can do a thousand kilometers of range. So it has to be hybrid, it has to be big and all of the tech and all of the luxury packs inside. So that's why we're seeing all these, these, they're called nine series cars. The, like the Xiaopang X G9, I can't remember the name.

[Robert Llewellyn]

Yeah, X9.

[Elliot Richards]

I think it looks quite a lot like a venture. Yeah. That's why we're seeing those huge SUVs, because they think, well we want a car that can deliver everything to everyone because maybe they can only afford to change their car once every five years now. So they want a car which can do everything, go everywhere and basically be the all and everything for them. So I think that's kind of what's happening at the moment is that there's fear. And like you said two last year or two years ago, so many automakers had a small EV. Like this is our small EV. It's £3,000, £4,000, 20 kilowatt hour battery, none of that. I think there's two small cars here this year. Two out of, out of 1450 cars here, there's two small cars.

[Robert Llewellyn]

I mean it becomes a bit of a self fulfilling prophecy if the, if the car industry advertises bigger cars because it can mean more metal, can mean more margin. They get themselves into a way of thinking that everyone wants these big vehicles. But I think that when we're industry people, I do quite like cars. I kind of oscillate on that a little bit. I know Robert does as well. I know you do. But the reality is that a lot of people just see them as a way of conveyancing themselves from A to B. Not everyone wants all of that tech. So in a way we're kind of maybe overcomplicating the product.

[Elliot Richards]

Absolutely.

[Robert Llewellyn]

And I guess productizing it and making it more expensive and taking it away from the average everyday person. But if the smaller vehicles aren't selling that way, well, that's a problem. Like, we talked quite extensively about Renault 5 selling well in the UK and Europe, and that's a great little car, a reasonable price point. But I guess there comes a point which the industry has convinced people they need bigger cars. The industry has convinced itself.

[Elliot Richards]

Correct.

[Robert Llewellyn]

And it's continuing down. When it wants to feel. When it feels fear and it wants to feel safe, it kind of goes back to that default, which is a shame because I love a saloon car, a sedan. I don't necessarily want a big suv, but it just seems here we're seeing a lot of different launches or any launches that are particularly stood out that you do, you do. Like we mentioned the Smart hashtag, too, which is. Yeah, yeah, well, they're going smart, going back to its roots effectively, which is. Which is good to see. I hope it does sell well. But my view is that people are probably looking for those slightly bigger cars. Is there anything here that's really stood out or is it idea where you're thinking, actually maybe some of the inspiration is running dry?

[Elliot Richards]

Yeah. So for me, the Smart hashtag, sorry, hashtag two is the only one which really stood out for me for being bold design, bold direction, return to form for Smart and kind of giving some consumers what they really want. We don't know price or anything, but other than that, there hasn't been much which stands out for me. You know, I haven't been particularly excited about, like, the Freelander looks cool, but if you've seen the concept here, it's huge. It's like taller than me. It's a concept, of course, Freelander, great to see that brand coming back. But it's another suv. They're going to go up market, they're going to go luxury, they're going to go premium. It's like, okay, we've seen that so many other times. I mean, there's a sports car from Denzer, which is quite interesting to see them going into that area. But that's kind of it, really. I think the. The other thing I forgot to mention was that the problem with those small cars, they don't make profit. And because the car companies are hurting so much at the moment, they have to say, well, this car's premium, so we're going to add another few thousand pounds on it. It's luxury. We're going to add another. And that's how they're trying to make their money back. So the only cars you can buy are premium and luxury. But where is the basic sedan here? There's none, not even on byd. And if that's the only product that people can buy now, then what can you do? That's the only choice.

[Robert Llewellyn]

I agree. It's really interesting. So when it comes to motor shows, I've been to a. I've probably got motor show fatigue actually. I've been to so many in the last year or so and I found it fascinating to see all the product launched in Shanghai flow through Munich and Brussels and the shows that we run as well, our everything electric shows are back very, very shortly in fact imminently will be in the north at Harrogate and then we're coming to Cheltenham in the west for the first time, then Twickenham and Sydney. You know, you've heard me talk about this many, many times before, I'm sure, but we understand these shows and it is fascinating. But this one feels bigger but maybe not as materially substantial as the Shanghai show a year ago. And maybe that's the first sort of sign that things are changing just quickly. Before we move out of this topic, I'm fascinated with how the Germans are presenting to the market. Last year in Shanghai, Audi launched. They've got a four ring strategy, so that's the traditional brand you're very familiar with. They launched a four letter strategy which is just Audi on a different brand effectively for China they launched a Sportback. It's a fabulous vehicle, fabulous vehicle, but to me it looks European and it comes with a premium price tag. How is that selling and how are the Germans doing in general in the Chinese market?

[Elliot Richards]

So the Audi 4 rings or whatever it's called. Yeah, it's not selling very well, unfortunately. It's a really good car but it's got the same problem as Polestar. So Polestar has basically pulled out the market here even though they're still built here because they're just seen as too European. Not enough tech, not enough voice integration, just the design is too European. Right. Not, not luxury enough. And the Audi one has fallen into the same sort of trap or same certainly same perception. And they've got their new suv. Jury's still out on whether BMW will be able to recover some of their market with their new Neue class. They're, they're moving faster than the Japanese because they, they, you know, integrating Huawei tech into their cars. The BMW, I think Audi are doing it as well and obviously VW has xpeng tech in their cars. That's the smart way to do it. But we'll see if the market responds well. It's the first year that these cars are coming onto the market and I still think they hold a lot of. They have a lot of brand love with consumers. We saw a wedding this morning and it's all Mercedes. Wasn't it 10 black Mercedes. So this still holds, still sins of prestige brand. But whether they can really integrate the tech effectively to become successful in the market is very much still to be seen.

[Robert Llewellyn]

It is interesting because I think there is such a cultural divide in terms of what cars are appealing to the Chinese consumption consumer and then what cars are repeating in Europe because Polestar is doing very well in uk, Australia, Europe, North America. So it is appealing to a big subset of people not to be sniffed at. And that's a growing brand. But ultimately European brands and the Japanese brands are spending so much time in China, that's actually probably changing the way they do things. I saw a new Hyundai launch yesterday. I didn't like the look. I say that regretfully because I like, I like the Hyundai kind of design language, but actually it was Chinese design. It looked a bit like the new Prius as well.

[Elliot Richards]

That's right, yeah.

[Robert Llewellyn]

A bit of a. Bit of a strange look. So it's very hard to keep a clear head, I'm sure, when you're an automotive executive. It's how do we. How do we plot our way through what is an incredibly difficult period of time? And anyway, we'll see how that plays out on the Pulse podcast. And everything looks electric cars over the coming months and years. It's fascinating. It's really good to talk to you. What we normally do on the Pulse podcast, we finish with, you know, who's winning this week and who's losing this week. So I'll give Elliot a moment to think about that. But who he's seen, maybe he's done well at the show and who's not done so well. This is a fantastic snapshot in time. If you like the Pulse podcast, please like what we do. Please subscribe Pulse Podcast on Everything Electric Cars YouTube channel. We also have a channel called Everything Electric Tech where we cover everything else really, from home energy to micromobility. I noticed a Green gravity battery episode that we did recently got 200,000 views, so that's worth listening into. Check out our events, follow us on our socials as well. But to finish off with who's, who's, who's won this week and who's lost

[Elliot Richards]

who's won this week? Definitely Catl and I'd probably say quite a bit Huawei. So they've integrated their tech into so many cars now. So not just Chinese cars but legacy automakers that they're just, they're just dominating the market.

[Robert Llewellyn]

I would also say I went to a Cherry press event yesterday. Yeah there was about 4, 000 people there. Cherry, slightly less well known brand in the UK and in some of the other markets that we're listened in but the reality is obvious they're bringing out a Moda JKU Cherry. They've got another couple of brands. I'm going to butcher them so I'm not going to mentioned those ones but there was 4,000 press there just for their press event. It was absolutely heaving. I've never seen anything quite like it. So a few winners and any, any standout company you think is slipping beneath the waves?

[Elliot Richards]

It's definitely the Japanese automakers. They just, they're too stubborn to change. Even though they've got a Chinese market strategy, they're not willing to take that elsewhere and I think that's going to. It's going to hurt them long term. I mean did you even see a horse Honda here today? I think they've got a couple of

[Robert Llewellyn]

cars but I don't know.

[Elliot Richards]

No impact. No impact.

[Robert Llewellyn]

As we always say, we don't want anyone to struggle to survive but the reality is that there are only. It's musical chairs and there are only so many seats to go around and the music's about second half this year, early next year I think we are going to see some casualties. I've always said though painting it as a Chinese catastrophe if there's consolidation actually isn't correct. I feel this has been the plan all along. An armada of brands, some of them will get through the blockade but Chinese have set out in full knowledge that many of them will not. But survival of the fittest.

[Elliot Richards]

Exactly.

[Robert Llewellyn]

And the car industry is quite competitive right now and it'll be really interesting to see how it plays out. So thank you very much for joining us today on the Pulse podcast. Thank you to Elliot as always. Hope you've enjoyed this. Elliot has also filmed a walk around video of the show so if you're interested in getting a closer look what's going on the show. Search for everything electric cars on YouTube Beijing show. Great to see you as always. If you have been. Thank you for listening.