China's EV exports more than double in March as Iran war energy shock drives global shift

China’s electric vehicle (EV) export machine surged into overdrive in March, with overseas shipments more than doubling to a record 349,000 units, as the energy shock triggered by the Iran war pushed consumers and governments worldwide to pivot away from petrol-dependent transport.

Data from the China Passenger Car Association showed exports of EVs and hybrids jumped 140 per cent year-on-year, underscoring how rapidly global demand is shifting amid volatile oil markets.

Energy shock fast-tracks EV transition

The spike in exports comes against the backdrop of a sharp rise in crude prices during the Iran conflict, which briefly pushed Brent above $117 a barrel before a tentative ceasefire. The surge in fuel costs has revived urgency around electrification, with buyers seeking insulation from pump price volatility.

Showrooms across Asia and Europe have seen a pickup in footfall, while data from the UK indicates electric car sales hit a record in March. Analysts say the current energy crisis is compressing what would have been a gradual multi-year EV adoption cycle into a much shorter window.

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Industry officials drew parallels with the 1970s oil shocks that accelerated demand for fuel-efficient Japanese vehicles — a historical precedent now playing out in favour of Chinese EV makers.

BYD leads export charge, eyes premium markets

BYD accounted for roughly a third of total shipments in March, consolidating its position as the world’s largest EV maker by volume. It was followed by Geely and Chery.

Beyond volume, BYD is also stepping up its global ambitions. The company is pushing into Europe’s luxury segment through its Denza line, hiring aggressively in sales and marketing as it seeks to challenge established premium brands.

Shares of BYD, Geely and Chery rose amid continued uncertainty around the Iran ceasefire and its implications for energy markets.

Western automakers lose ground in China

While Chinese manufacturers expand globally, Western automakers are struggling to maintain their foothold in the world’s largest auto market.

Mercedes-Benz reported a 27 per cent drop in China sales in the first quarter, reflecting intensifying competition from domestic EV players. The German carmaker is now attempting to recalibrate through China-specific models and deeper local partnerships.

Even Tesla faces mixed fortunes: shipments from its Shanghai factory rose about 9 per cent year-on-year, but domestic sales in China fell 24 per cent, highlighting weakening local demand.

Domestic slowdown contrasts export surge

The export boom masks a more challenging picture at home. China’s total EV and hybrid sales fell 14 per cent in March to 848,000 units — marking a third straight monthly decline and the first first-quarter drop since 2020.

The slowdown reflects reduced trade-in subsidies and weaker consumer spending, particularly affecting entry-level vehicle segments.