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Politicians and auto industry leaders in the United States and Europe have long argued that state-sponsored subsidies for Chinese electric vehicle makers have distorted global competition.
A new report from research firm Rhodium Group challenges that assessment, saying structural advantages — not subsidies — are a key factor giving Chinese EV manufacturers an edge over Western automakers.
These structural efficiencies include vertical integration, larger production scale and lower overhead costs, which outweigh the effects of heavy state subsidies on the profit margins of Chinese electric vehicle manufacturers, according to Rhodium.
Since 2009, Chinese authorities have disbursed more than $29 billion in tax breaks and subsidies to manufacturers of electric consumer vehicles, according to estimates from MIT Technology Review.
