22 November 2023

General Overview

In October, the China Association of Automobile Manufacturers (CAAM) expressed dissatisfaction with the European Union’s investigation into subsidies for Chinese electric vehicles (EVs). CAAM criticized the “very short” consultation time provided by the EU and labelled the probe an “obvious act of protectionism” that could impede global EV industry growth.

The European Commission officially initiated the investigation to determine whether tariffs are necessary to protect EU manufacturers from an influx of subsidized Chinese EV imports. The Commission’s information indicates that Chinese producers benefit from various subsidies, including grants, preferential loans, tax cuts, and state-provided goods at below-market prices.

China’s commerce ministry stated that the investigation lacks evidence and doesn’t follow World Trade Organization rules. China also raised concerns about the lack of consultation materials provided and vowed to monitor the Commission’s investigation to protect its firms’ interests.

Source: REUTERS/Dado Ruvic/Illustration/File photo
Link: https://bit.ly/3QStAqz

The EU invited China for consultations without specifying a timeframe. The Commission noted that China’s share of EVs in Europe has reached 8% and could grow to 15% by 2025. Parties interested in a hearing have 15 days to request one, with a 37-day deadline for comments.¹

Meanwhile, at the Japan Mobility Show, the rebranded successor to the Tokyo Motor Show, Japanese automakers like Toyota, Honda, and Nissan—often criticized for their reluctance to phase out gasoline cars—introduced a slew of EV concepts. This move signals their willingness to push battery-powered vehicles in Japan, where battery-electric vehicles accounted for only 1.5% of new car sales in 2022—far less than other affluent nations. In contrast, in 2022, China saw one in five new cars sold as battery-electric.

Despite 500 companies participating in the show, only three foreign carmakers were present: BYD from China, Mercedes-Benz Group AG, and BMW AG from Germany. The limited EV adoption in Japan extends to non-Japanese brands as well, with early sales of electric cars from foreign manufacturers in the country being slow.

Most Japanese automakers have committed to increasing EV production and reducing emissions but aren’t expected to launch high-volume EV models to compete with companies like BYD or Tesla until at least 2025.²

Company Specific Updates

BYD Co Ltd

Chinese automaker BYD is on the cusp of surpassing Tesla as the world’s leading EV manufacturer, driven by surging global sales. In the last quarter, BYD came remarkably close to overtaking Tesla as the top EV seller due to factory downtime impacting Tesla’s deliveries.

Source: BYD Company Ltd.
Link: byd.com/us

BYD achieved an impressive 23% increase in fully electric vehicle sales, totalling 431,603 units in the three months ending September 30. In the same period, Tesla delivered 435,059 cars, resulting in a narrow gap of just 3,456 units between the two rivals. Industry experts anticipate that BYD will likely surpass Tesla in the fourth quarter in terms of fully electric passenger vehicle sales.

Furthermore, BYD’s diversified portfolio, which now includes luxury EV brands and more affordable models, has contributed to its remarkable sales growth. The company is also expanding its presence in the global market, with exports accounting for 9% of its third-quarter sales, up from 5% in the previous quarter.³

Rivian Automotive Inc

Rivian’s latest quarterly results demonstrate substantial growth in EV production and deliveries. In Q3, Rivian achieved record figures, producing 16,304 battery electric vehicles (BEVs), a 121% increase from the previous year. They also delivered 15,564 units, reflecting a 136% year-over-year rise.

For the year, Rivian has so far produced over 39,000 EVs and delivered more than 36,000, nearly tripling their results from the previous year. In all of 2022, they produced 24,337 EVs and delivered 20,332 to customers.

Source: 2023 Rivian
Link: https://rivian.com/r1s

Rivian is optimistic about its future production capabilities, stating that it is on track to achieve its annual production guidance of 52,000 vehicles this year. This figure, raised from initial expectations, may even be surpassed if the company maintains its strong performance.

Since Q3 2021, Rivian has produced over 65,000 EVs and delivered more than 57,000, primarily in the United States market.

While Rivian has faced financial challenges, including losses per truck sold in Q2, these results signify positive progress. Additionally, the company is expanding its EV lineup with extended-range versions of the R1T and R1S models, signalling continued growth and innovation.⁴

CARS ETF: Investing in Future Cars, Driving Our World Forward

The auto industry is undergoing the biggest transformation in generations and there is a growing demand for ways to invest in this industry.

The Evolve Automobile Innovation Index Fund (TSX Ticker: CARS), CARS ETF, is Canada’s first automobile innovation ETF. CARS ETF takes a diversified approach to invest in the development of electric cars, self-driving cars, and automobile innovation, including in some of the world’s leading manufacturers and automobile companies. CARS ETF is a great way to gain access to the future of the automobile and shift your investments into gear.

For more information on the Evolve Automobile Innovation Index Fund or any of Evolve ETF’s lineup of exchange-traded funds, please visit our website or contact info@evolveetfs.com.

Portfolio Strategy and Activity

For the month, BYD Co Ltd made the largest contribution to the Fund, followed by Advanced Micro Devices Inc and Li Auto Inc. The largest detractors to performance for the month were ChargePoint Inc, followed by Rivian Automotive Inc and Microvast Holdings Inc.



  1. “China rebukes EU after formal launch of EV subsidy probe,” Reuters, October 4, 2023; https://www.reuters.com/business/autos-transportation/china-rebukes-eus-rushed-request-consultations-over-ev-subsidy-probe-2023-10-04/
  2. Takahashi, N., “Japan’s Carmakers Stage Show to Demonstrate Real EV Ambition,” Bloomberg, October 22, 2023; https://www.bloomberg.com/news/articles/2023-10-22/japan-s-carmakers-take-stage-to-show-their-ev-ambitions-are-real
  3. Lee, D., “Tesla Sales Drop Brings BYD Closest Ever to Global EV Crown,” Bloomberg, October 2, 2023; https://www.bloomberg.com/news/articles/2023-10-03/tesla-sales-drop-sees-byd-close-gap-in-race-for-ev-supremacy
  4. Kane, M., “Rivian More Than Doubled EV Production And Deliveries In Q3 2023,” InsideEVs, October 2, 2023; https://insideevs.com/news/689508/rivian-production-deliveries-2023q3/
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Tags battery-powered vehicles  byd  cars etf  electric cars  electric vehicle  electric vehicles  european union investigation  EV  Ford  japan mobility show  nvidia  rivian  Tesla