The rise of electric vehicles is one of the most interesting and consequential changes in the world’s industrial structure to come along in some time. Among other things, it has enabled the Chinese government to fulfill its long-held dream of becoming a globally competitive producer of passenger cars; in a very short period of time, China has become a major exporter of electric vehicles. The International Energy Agency has some useful summary statistics in its Global EV Outlook:

China is a leading exporter of electric cars, representing over 35% of electric car exports, as well as of batteries. Europe is China’s largest trade partner for both electric cars and their batteries. Indeed, over the past year the share of electric cars sold in the European market coming from China increased from about 11% in 2021 to about 16% in 2022.

Over the past five years, the share of global electric car exports coming from China has increased more than eightfold, with China becoming the largest exporter in 2021 and the gap further widening in 2022. The share of electric car exports from the United States peaked in 2019 and has since fallen below the levels exported from China, Korea and Europe.

This is an undeniable success for China’s strategy of building up a complete domestic supply chain for the batteries and other components going into electric vehicles. But it’s a success that has also depended on partnerships with multinational companies. According to EV Volumes, China exported about 580,000 electric vehicles in 2022, of which 407,000, or around 70%, were “Western brands.” (Just to give an idea of the speed of growth, exports in the first half of 2023 have already topped 500,000 units,)

By far the most important of those Western brands is Tesla, which according to the IEA accounted for about 40% of China’s EV exports in 2022. Another 20% of China’s EV exports were from European companies; this should include the Renault-Nissan group and BMW. (The remaining 10% are probably “Western brands” that are Chinese-owned: SAIC owns the British MG brand and makes MG-branded EVs in China, while Geely controls Volvo and Polestar, whose EVs are made in China for export).

The success of China’s EV exports is therefore inseparable from the decisions of multinational companies to make China their base for global EV exports (and of other countries’ willingness to allow a level of Chinese investment in their auto industries that China would not have allowed for foreign investment in its own auto industry).

Those decisions go back some years. BMW’s joint venture in China started making EVs as far back as 2013, started producing the iX3 in 2020 and opened another $2.2 billion EV plant in 2022. The Renault-Nissan group announced an EV joint venture with Dongfeng in 2017; it started out making models for the domestic market, but is also now making the Dacia Spring for export to Europe.

Tesla’s major investment in its Shanghai factory came a bit later, only after China’s decision to remove the requirement that foreign automakers operate through joint ventures. This liberalization took effect in 2018 for EVs and in 2022 for other vehicles. In addition to its direct effects on exports, Tesla’s entry into China is also generally credited with injecting new dynamism into the domestic market:

Despite all that government support, sales of EVs remained weak until 2019, when China let Tesla open a wholly owned factory in Shanghai. “It took this catalyst…to boost interest and increase the level of competitiveness of the local Chinese makers,” said Tu Le, managing director of Sino Auto Insights, a research service specializing in the Chinese auto industry.

Electric vehicles were less than 5% of domestic vehicle sales until 2020, really took off in 2021, and have surged since then to around 30% of domestic sales. According to another analyst:

Tesla’s brand appeal helped nudge more consumers to switch from gas-powered cars. A supply chain built around Tesla now feeds a wave of improving homegrown EV makers. “If you’re China: thank you Tesla for waking up the part of the market which was sleeping, which was retail consumers,” said Bill Russo, founder and CEO of Automobility, a Shanghai-based strategy and investment advisory firm.

The current success of China’s EV industry therefore has to be seen as a success of globalization–the flow of international capital seeking out the most efficient location–not just for domestically focused industrial policy. It’s the interaction between those two factors that has given China’s EV exports their rather unusual composition.

But in 2023, after the trade war, the Ukraine war and the collapse of US-China relations, the international structure of China’s EV exports also looks like the peak of a particular form of globalization that will not be reached again anytime soon. In 2013 or 2017 it was definitely not controversial for a Western multinational to choose China as the global export base for a major new product; in 2023 it certainly would be. In the current political climate it is very hard to imagine Western multinationals making such decisions again without hesitation.

The global rise of China’s EV industry looks like it is just getting started. But the model that kick-started that rise may not be available for repeat use.