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Abstract

Between 2018 and 2023, China’s electric vehicle exports increased more than tenfold, making it the world’s largest EV exporter. In response, the U.S. and Canada have announced 100 percent tariffs on Chinese EVs, citing concerns about unfair pricing and government subsidies. But are Chinese firms really dumping low-cost EVs on the global market? This thesis provides an empirical test of that question. Using a simple accounting framework to separate supply-side technological improvements from demand-side consumer preferences, I analyze international car import data to understand what’s behind China’s EV export boom. The analysis shows that Chinese EV manufacturers have substantially upgraded product quality, enabling significant penetration into high-income markets without relying on lower prices. Marginal production costs for Chinese EVs remained stable, which suggests that technological advancements and supply-chain strategies, rather than cost reductions, lead to their competitiveness. These findings challenge the basis for current anti-dumping tariffs and suggest that China’s EV export boom is because of its real competitiveness, not cost manipulation. The results carry important implications for how policymakers should respond to the rise of high-tech exporters from emerging economies.