The shift to EVs is accelerating thanks to a number of factors:
In fact, BloombergNEF predicts passenger EV sales should reach 14 million by 2025  before accelerating even faster in the rest of the decade.
China is prioritising the transformation of transportation and the pace of EV adoption by placing it at the centre of several government initiatives. EVs were named as one of the key industries of its ‘Made in China 2025’ programme and the electrification of transport is a core component in its drive to achieve carbon neutrality by 2060.
While the government is aiming for new energy vehicles  (NEVs) to make up 20% of new car sales by 2025, we expect penetration to be faster thanks to favourable government policies and their growing popularity among consumers, more competitive pricing, the introduction of new features and the rollout of more charging stations.
In fact, this faster-than-expected transition is starting to show up in the latest data: NEVs reached 20% of new car sales this August. 
NEV sales in China have been growing exponentially since 2009, when the government introduced subsidies and its Ten Cities, Thousand Vehicles pilot programme.
However, as the industry matures and the cost of EVs continues to fall, the government is starting to phase out subsidies by reducing the amount by 10% a year. It has shifted its focus to EV producers. A dual-credit policy requires carmakers to meet an annual credit target by selling a certain number of EVs. This target becomes more stringent each year and carmakers that do not produce enough EVs and do not increase their average fuel economy levels will be forced to buy credits from those that have achieved a surplus.
Additional support for EV adoption includes mandating EVs as the preferred choice for government procurement, exempting them from vehicle purchase tax until 2022 and offering preferential access to licence plates in a number of cities.
Advances in battery technology and economies of scale has seen the cost of batteries fall significantly recently – the price of lithium-ion batteries has fallen by 89% since 2010 . The lower cost has enabled carmakers to launch EVs at a more competitive price and the range capabilities of these models has increased.
The increased number of charging stations is another pivotal step to ease range anxiety and supports EV adoption. According to BNEF, there were 884 400 public charging connectors as of July 2021. That is equivalent to five EVs per connector. This compares favourably to other countries.
Even so, charging speeds and reliability remain an issue as many public chargers use slow AC and some connectors are not operational. Carmakers are doing their bit to address this issue, for example, through a battery swapping EV model or expanding their own fast-charging networks.
An additional attraction of EVs is that they are at the forefront of new technologies. The Chinese government supports the development of autonomous driving and aims to have 50% of new cars equipped with Level 2 and Level 3 automation by 2025 and 70% by 2030. 
There will be no ignoring the electric car revolution in the coming years. While China has been driving EV adoption, demand is expected to spread across the world, and with it, competition.
The supply and choice of electric or hybrid models is set to expand from around 330 currently to over 500 by 2025.  A number of incumbent carmakers are looking to enter the EV market alongside more new entrants, particularly among the technology giants. This should inject around USD 330 billion of investment into the sector by 2025. 
In such a changing investment environment, identifying those companies with a strong brand presence, differentiated offerings in terms of both hardware and software to serve the target audience and a secure upstream supply chain will be key.
The Environmental Strategies Group is using its technological knowledge and understanding of this rapidly changing market to uncover EV businesses set to win this long-term race and identify those that will be left by the roadside.
 NEV include battery electric vehicles, plug-in hybrid electric vehicles and hydrogen fuel cell vehicles
 China Passenger Association
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