It is just three years since China profiteered and held other countries over a barrel for medical equipment as the COVID-19 pandemic raged. With the climate crisis deepening and Beijing moving to conquer the electric vehicle market, has the world forgotten?
For a power structure that could go Chernobyl at any moment, the Chinese Communist Party has a habit of wringing the most out of the crises it survives. It might deliberately flood your home to shield a presidential pet project, but it will concurrently video its rescue teams pulling you from the wreckage, while distracting viewers with images of other disasters elsewhere on our planet instead. That’s all a lot of people will see. Along with the project in full glory.
An acute version of this played out for COVID-19. After lying about the severity and infectiousness of the outbreak, thereby cutting the rest of the world’s reaction time, and holding back information about the virus’s genome, Beijing then took advantage of the ensuing global wave of death to blare out propaganda about its response, spread disinformation and sew vaccine distrust, as the companies it governs sold millions of dollars of useless equipment.
Since most countries had hooked up their supply chains to rely on China for their basic medical needs, they had little choice but to tolerate these antics and look happy while doing so. Worse, in some cases, states were called upon to provide other political favors in exchange for receiving medical supplies. Crises are opportunities for a certain mindset, after all.
Into this fray advances climate change, which threatens to dwarf the impact of COVID-19 in a signature hail of fire, heat death, torrents, droughts, super-storms and, yes, diseases. Once again, China is, by turns, worsening the danger and positioning itself to control access to the materials needed to fight it, while pumping propaganda on an industrial scale. And, once again, it is anchoring its relationships with other nations around a catastrophe, whereby it frames itself as a partner, not an irresponsible and hostile state that will exploit desperation to consolidate its empire. In this manner, it is carefully forging new political weapons to project control into the future.
One target is electric vehicles. A growing number of people agree that a transition to these imperfect but more climate-friendly transport options is necessary. Not a few governments have the same perspective, and a widening raft of regulations is compelling their citizens to replace gasoline motors. Consequently, anybody who can establish an upstream stranglehold over their manufacture stands to exert concessions from everybody downstream. They will also make a vast amount of money along the way.
Herein, recent figures from Europe’s electric vehicle market, the world’s second-largest by region, are alarming. China’s share may look small, but it is burgeoning. For the pure battery segment, its portion in percentage terms rose nearly eight-fold over just two years from 2019 to 2021. Then, it stood at 3.9 percent. For the year to date, just over 18 months later, it is 8.2 percent for the electric vehicle market in general with sales occurring almost double the speed of in 2022. Even in Germany, which knows a thing or two about cars, imports of Chinese motors spiked to 28.2 percent in the first quarter of 2023, up from 7.8 percent for the same period in 2022, compared to those from other countries.
And this is not the full story. China has influence over the electric vehicle industry stretching far beyond the volume of potential spymobiles. Tesla, which is a global market leader for full battery electrics, can currently sell more than 80,000 vehicles a month from a factory in Shanghai, a footprint it is seeking to double. Volkswagen Group, which accounts for approximately one in five European electric vehicle sales, has 33 plants in China with an annual production capacity of about 5 million units and holds partnerships with Chinese firms XPeng and state-owned SAIC. Its willingness to continue operating in East Turkestan (Xinjiang) amid a possible genocide is therefore not so surprising. Neither are Tesla CEO Elon Musk’s Beijing-endorsed opinions on Taiwan.
The influence yet goes deeper. Over 60 percent of the lithium-ion batteries that power most electric vehicles are produced by Chinese companies, which sell on to many major automotive manufacturers like BMW and Peugeot. China is also processing around 40 percent of all the lithium extracted globally, which is shipped to the Middle Kingdom from far flung locations such as Argentina, Zimbabwe and Mali. Its companies own stakes in numerous lithium mines across the world, nearly 20 of which have been purchased in the last two years, which add to its own domestic sources in places like Heilongjiang.
Given the reliance of electric vehicles and other technology on lithium, and depending on whether future designs discover viable alternatives, it can be thought of as the new oil, bringing similar insulation to the power-structures that possess and refine it. A similar argument could be made for cobalt, which abounds in the Democratic Republic of Congo. China holds sway over around 80 percent of mines for the element there.
The solar industry serves as a crystal ball for what to expect next. There, China engaged in multiple tactics to nosedive the cost of polysilicon: cheap energy from coal; subsidies; colonial occupancy of mineral resources; and increased duties on overseas competitors that wanted access to the Chinese market. This eradicated rivals from other countries, and, since polysilicon is a core raw material for 95 percent of solar modules, left downstream firms little choice but to source from China, which could then turn to centering itself at the United Nations as the supervisor for a potential global green power grid.
Unfortunately, it also meant solar panel manufacturers accepting the unacceptable: forced labor. Researchers have disclosed various lines of evidence that Uyghurs in particular are being transferred without realistic possibility of consent to work in the production of solar materials and components. Thus, Beijing has been able to offer the world a stark ultimatum: Accept modern, colonial slavery or accelerate planetary warming beyond two degrees.
As China’s output of electric vehicles and batteries intensifies, and allegations proliferate of workplace, human rights and environmental abuses in its greenhouse gas-emitting supply chain for them, the world is approaching a very similar dilemma in the automotive sphere. This may become more pressing, if Beijing seeks to stabilize the countries where it sources raw materials in its own image as it expands exploitation of lithium reserves in its Tibetan and East Turkestani colonies.
Nonetheless, there are alternatives this time, including greener ones. The complexity of battery technology offers points of leverage, if other countries are willing to cooperate and actually use them, as China does not have a firm grasp over all the inputs it needs for production at scale. Democracies like Canada and Australia have massive lithium deposits, too, and several automotive giants are already positioning battery plants in the former. New techniques to extract the element, recycle or leapfrog to other forms of battery chemistry could swerve influence to new centers as well. Not all China’s source countries for electric vehicle ingredients are happy with their present arrangements, either.
That said, strategic resource games are all well and good, unless whole branches are falling off the tree of life as we play them, and any green transition that does not violate international rights norms will have to apply the same kind of coordinated long-term planning and investment that China has implemented to put itself in a position of dominance at the present moment. Furthermore, that can only be achieved if the same foot-dragging and denialism that afflicted early-stage climate change and COVID-19 are avoided in regard to the threat Beijing poses to the free world.