By Greg Gao

China’s production and sales of electric vehicles reached 1.036 million and 1.007 million units respectively in the first quarter of 2022, an increase of 1.4 times year-on-year, according to a report released by the China Academy of Information and Communications Technology (CAICT) on April 23. 

In March, the production and sales of EVs in China were 376,000 and 396,000, an increase of 1.1 times over the same period of the previous year, and the growth rate was lower than that in February. 

China exported 16,000 new energy vehicles in March, less than 1/3 of the previous month, but still with a year-on-year increase of 71.5%. The growth rate fell sharply from the last month as the overseas market was affected by unfavorable factors, including geopolitical tensions and the Covid-19 outbreak. In the first quarter, the cumulative export of new energy vehicles from China was 121,000 units, a year-on-year increase of 2.9 times, with continued strong momentum. 

The booming EV market also helps push up the revenue and profit of supply chain companies, including Zhuhai Enpower Electric(英博尔), an EV components manufacturer based in Zhuhai, southern China’s Guangdong Province.

The company announced on April 22 that its operating income hit RMB 976 million($150 million), a year-on-year increase of 131.8%. The company’s net profit attributable to shareholders reached RMB46.8407 million ($7.2 million), a year-on-year increase of 256.01%.

Enpower Electric said it had substantial growth last year of its products such as motor controllers, charging systems, converters, electronic accelerator pedals, and other related products for electric vehicles used in new energy passenger vehicles and special electric vehicles

But there is also a gloomy side to China’s EV market. Since the beginning of 2022, Covid-19 outbreaks have occurred in many cities in China. Currently, some EV manufacturing plants and supporting factories in the supply chain have been suspended, and the time for resumption of production is still uncertain. Coupled with the rise in the price of power battery raw materials, several car companies plan to increase prices. China’s EV market is expected to face greater pressure on both supply and demand sides.