Article by｜Lin Keying Guo Yifei
Edited by｜Yang Buding
Chinese Australian Li Lin (pseudonym) decided to buy a BYD.
Her family already owns a fuel vehicle. However, due to the recent sharp rise in oil prices, she began to worry about a potential energy shortage in the coming period, saying, &#34;I might not even be able to refuel.&#34; She told Tencent Auto's &#34;High Beam&#34; that there are many others in the area with similar thoughts; during just one hour at the BYD store, five or six vehicles were sold, with deliveries scheduled for at least a month later.
With the outbreak and escalation of the US-Iran conflict at the end of February, the global energy market was quickly pushed into a tense state. In March, international Brent crude oil futures prices soared by 63%, marking the largest monthly increase since 1988.
The sharp rise in oil prices began to stir the global automotive market. Official data shows that in March this year, BYD's overseas sales reached 119,591 vehicles, a year-on-year increase of 65.2%.
On March 31, BYD Chairman Wang Chuanfu stated in a communication meeting that the export situation this year is good, especially as the situation in the Middle East has driven up global oil prices, &#34;In Australia, New Zealand, the Philippines, etc., daily sales now are equivalent to what we had in the previous two weeks.&#34; He predicts that this round of rising oil prices is expected to push BYD's export sales to new highs.
XPeng's Germany manager Qian Qiang also told Tencent Auto's &#34;High Beam&#34; that in the first quarter of this year, XPeng's sales in Germany have tripled year-on-year.
The impact of rising oil prices may just be beginning.
Recently, Fatih Birol, the Executive Director of the International Energy Agency, stated in a program that the energy crisis triggered by the US-Iran conflict is the most severe in history, and the situation in April will be worse than in March. He explained that in March, some oil and gas-carrying ships that had set sail before the outbreak of war were still arriving at ports, but by April, there would be no oil to transport, and the oil supply gap would be twice that of March.
Meanwhile, on March 30 local time, the Iranian Parliament's National Security Committee passed a bill proposing to charge fees for vessels passing through the Strait of Hormuz, which also means that high oil prices may persist for a longer time.
During this period, Tencent Auto's &#34;High Beam&#34; has continuously sought information from automotive industry professionals in Europe, Southeast Asia, China, and other regions. Several relevant individuals indicated that after the rise in oil prices, the test drive and order volumes for Chinese electric vehicles in various markets have generally increased, but this growth is mainly influenced by promotional policies, market cycles, and other factors. Whether Chinese car companies can gain significant benefits from this round of oil price fluctuations remains uncertain in the short term, but in the long run, rising oil prices are undoubtedly accelerating the global automotive market's transition to electrification.
<h4>The &#34;wealth&#34; brought by war, can Chinese car companies in Europe catch it in the short term?</h4>
From February 23 to March 23, within a month, the average price of 95 octane gasoline in the 27 EU countries rose from €1.551 to €1.783, an increase of 15%.
When oil prices fluctuate, the first to react in the automotive industry is often the second-hand car market, which offers lower prices and quicker deliveries.
Qian Kai told Tencent Auto &#34;High Beam&#34; that the demand for used electric vehicles in the German market has begun to grow recently, while the growth of new cars usually lags behind.
According to data company Marketcheck, in March this year, the sales of used electric vehicles in the UK reached 131,559 units, a month-on-month increase of 17.6%, and the market share also rose from 15.06% in February to 15.45%.
An industry insider in Germany stated that there has indeed been discussion about rising oil prices recently, but the prices of electric vehicles remain relatively high, and electricity prices in Europe are also not cheap. &#34;Overall, it will definitely promote electrification in Europe, but I am skeptical about a sharp increase in the short term.&#34;
Germany is one of the largest car markets in Europe and is also a country with a relatively aggressive energy transition. By 2024, about 62.7% of Germany's electricity will come from renewable energy, with coal power accounting for about 22.5%. However, due to the high costs of energy transition, electricity prices in Germany have remained high for a long time. According to data from the German Association of Energy and Water Industries, the electricity price for German residents in 2024 is expected to be around 40.92 euro cents per kilowatt-hour (approximately 3.13 RMB), ranking among the highest in Europe. This means that even if oil prices rise, the cost advantage of using electric vehicles in Germany is not obvious.
Qian Kai stated that XPeng's orders in Germany tripled year-on-year in the first quarter, but he also mentioned that Chinese electric vehicles are still in a growth phase in Europe, so &#34;it is hard to say how much of a role the situation in the Middle East has played.&#34;
Chinese automotive brands mostly entered Europe around 2021, and it has been five years since then. However, Europe is a challenging market, with a local automotive industry ecosystem that differs significantly from China. Local brands like BBA have a solid foundation, making it difficult for car companies to establish brand recognition. Additionally, the pace of electrification in Europe has slowed in recent years, and Chinese car companies are still exploring and trying to move forward.
According to EU-EVS data, as of March 29, the sales of electric vehicles in the UK reached 58,517 units in March, with BYD selling 3,252 units, accounting for about 5.6% of the pure electric share, ranking fifth. Nevertheless, the overall market presence of Chinese brands in Europe remains limited.
An individual engaged in automotive compliance for overseas markets stated that local oil prices in Europe have indeed risen significantly, but the sales of Chinese brands are small, and most new force brands are still in the stage of building channels, after-sales, and compliance systems, &#34;making it highly likely that they won't be able to handle the traffic brought by this wave of war.&#34;
In February this year, BYD's new car registration volume in the European market increased by 162% year-on-year, with its market share rising from 0.7% in the same period last year to 1.8%, surpassing Tesla again, although March sales in Europe have not yet been announced.
The aforementioned compliance individual told Tencent Auto &#34;High Beam&#34; that the increase in BYD's sales is more due to promotional factors, which is also the first time it has publicly cleared inventory in the German market. &#34;Basically sold at a loss, which has also driven a wave of electric vehicle purchases among Chinese consumers. We almost bought 2 units ourselves, but later considered that there might be a lot more of this wool, so we decided to wait a bit longer.&#34;
In February of this year, Lars Bialkowski, head of BYD Germany, stated that the goal is to achieve 50,000 new vehicle registrations by the end of this year. According to the German Federal Motor Transport Authority, BYD's new vehicle registrations in Germany were 23,306 in 2025, which means this year's sales need to double.
<h4>Thai Prime Minister Switches to BYD, Southeast Asia's Electric Vehicle Sales Surge</h4>
Compared to the European market, the transmission of oil price changes is faster and more direct in Southeast Asia.
On March 23, the Bangkok International Motor Show officially opened, with over a dozen Chinese car companies occupying nearly half of the exhibition hall. As of March 29, MG sold 4,217 vehicles, and Chery's brands OMODA &amp; JAECOO sold 3,984 vehicles, ranking second and third among the companies that have announced their exhibition order volumes, only behind Toyota's 5,672 vehicles. Brands like Changan, Geely, Chery, Great Wall, and GAC also exceeded 2,000 orders, while BYD has not yet announced its order numbers.
A general manager of a Chinese automotive brand in Thailand told Tencent Auto's &#34;High Beam&#34; that due to the dual impact of motor show promotions and rising oil prices, their brand's retail sales doubled month-on-month in March.
Southeast Asia is one of the earliest regions for Chinese car companies to expand overseas. In the past two years, brands like BYD, Great Wall, Changan, GAC, and Chery have successively established factories in Thailand, Indonesia, Vietnam, and other locations. Yan Feng (pseudonym), responsible for the company's Southeast Asia marketing, noticed during a business trip to Thailand in March that Chinese brand cars were noticeably increasing on local streets, with BYD, Changan, and MG everywhere, and Aion also present in ride-hailing services, “It's almost like at home.”
Unlike Europe, the Southeast Asian market rarely experiences simultaneous &#34;oil and electricity price increases&#34; in the face of geopolitical conflicts. On the contrary, local electricity prices are relatively stable, while oil prices are more sensitive to international markets, causing the price gap between oil and electricity to widen rapidly during conflicts, making the economic advantages of electric vehicles more apparent.
Taking Thailand as an example, its electricity structure is primarily based on natural gas power generation, accounting for nearly 60%. The cost of natural gas power generation is relatively stable, allowing Thailand's electricity prices to remain low over the long term. Starting in 2025, Thailand will adjust the basic electricity price to 4.15 Thai Baht (approximately RMB 0.87), which is far lower than European electricity prices.
At the same time, rising oil prices are continuously widening the price gap between oil and electricity. On March 31, the price of 95-octane gasoline in Thailand reached 42.05 Thai Baht per liter (approximately RMB 8.82 per liter), an increase of 38% compared to early March, further highlighting the cost advantages of electric vehicles.
In March of this year, Yan Feng, who was on a business trip to Thailand, found that refueling had become difficult locally, stating, “It might take two or three visits to gas stations to get fuel.” He believes this experience will strengthen consumer attention towards electric vehicles, which is expected to be a positive factor.
A leading dealer in Malaysia also told Tencent Auto's &#34;High Beam&#34; that after the rise in oil prices, the number of customers coming to test drive electric vehicles has significantly increased, “It can be said to have multiplied, and order volumes have at least doubled. We are still quite optimistic about the subsequent market.” However, he also mentioned that domestic gasoline vehicles, due to their low fuel consumption and affordable prices, are currently less impacted, and the government also provides subsidies for fuel prices
Despite the warming market atmosphere, Southeast Asia still faces a scale ceiling. Yan Feng stated that Thailand's annual car sales are about 600,000 units, with Chinese brands accounting for approximately 22%, or around 130,000 units. Currently, Chinese car manufacturers have a production capacity design in Thailand of about 600,000 to 700,000 units, but the actual utilization rate is only about one-third.
&#34;Even if Thailand grows, this volume is still not enough for Chinese car manufacturers,&#34; he said.
In addition, infrastructure remains one of the limiting factors. A person from a Chinese brand's overseas market stated that electric vehicles rely on charging networks, and under the current global economic environment, Southeast Asian countries still face funding pressures for large-scale construction of charging facilities. Therefore, hybrid and plug-in hybrid models may have more realistic opportunities.
More important than short-term sales growth may be the driving effect of this round of oil price increases on energy transitions in various countries. Recently, Cambodia announced a reduction of electric vehicle import tariffs to 0 and introduced related incentive policies. Thailand, Indonesia, Vietnam, and other countries have also successively launched electric vehicle subsidies and tax incentives to accelerate the development of new energy vehicles.
On March 24, the Thai government announced an increase of 2 baht per liter in gasoline prices. The next day, Thai Prime Minister Anutin did not take his usual Rolls-Royce but instead took a BYD Dolphin to the parliament and suggested in a media interview that the public try electric vehicles more, stating that they can not only reduce fuel costs but also achieve zero emissions.
&#34;Local consumers' awareness of electric vehicles has greatly improved compared to before, and this will affect ordinary consumers' car purchasing choices,&#34; said the general manager of a Thai brand.
The aforementioned overseas market person believes that breaking away from oil dependence is a common aspiration for most non-oil-producing countries, and this round of oil price increases provides an opportunity for Chinese car manufacturers to promote new energy vehicles. &#34;Hybrid and pure electric are currently the most mature solutions, and for Southeast Asia, this is also an industrialization opportunity.&#34;

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With the surge in oil prices, the sales of Chinese electric vehicles in Southeast Asia and Australia have skyrocketed. BYD's overseas sales reached 119,591 units in March, a year-on-year increase of 65.2%. Due to the energy crisis caused by the US-Iran conflict, oil prices are expected to remain high, driving up the demand for electric vehicles. XPeng's sales in Germany also tripled year-on-year. The International Energy Agency warns that the oil supply gap in April will be twice that of March, significantly increasing market attention on electric vehicles

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Can't refuel anymore! Chinese electric vehicles are selling like crazy in Southeast Asia and Australia, and the Prime Minister of Thailand has switched to BYD