China’s ‘New Three’ Exports Power Ahead, but Trade With U.S. Slumps
Electric vehicles, lithium-ion batteries and solar cells — collectively known as the “New Three” — have emerged as key drivers of China’s export growth.
China’s exports of new energy products rose further in July, buoyed by strong overseas demand for electric vehicles and lithium-ion batteries. But the momentum was dampened by a sharp drop in shipments to the United States, where a new wave of tariffs squeezed sales across a range of sectors.
Data released recently by the General Administration of Customs showed China exported 410 million lithium-ion batteries last month, up 25.4% from a year earlier. The value of those exports surged 31.7% to more than $7 billion. For the first seven months of the year, battery exports climbed 26.2% to $41.1 billion.
Solar cell exports also saw significant volume growth, jumping 56% year-on-year in July to 1.1 billion units. However, the export value dropped 14% to $2.22 billion due to lower global prices. For the January to July period, total solar cell exports reached 6.49 billion units, up 53.8%, but the export value fell 23.4% to $15.49 billion.
Electric passenger vehicle shipments rose 69.4% in July to 325,000 units, with export value increasing 48.9% to nearly $5.92 billion. In the January–July period, exports totaled $34.6 billion, up 25.8%.
Chinese automakers are recalibrating their strategies amid rising trade tensions. In response to new tariffs in key overseas markets, particularly the European Union, many are moving toward plug-in hybrid models, which are less affected by the anti-subsidy measures targeting battery-electric vehicles.
In July, plug-in hybrid exports soared 236.9% to 75,000 units, with their value climbing 175.3% to $1.56 billion. Meanwhile, exports of pure electric vehicles — long the dominant category — grew more modestly, with value up 19.3% to $3.4 billion. For the first seven months of 2025, the value of pure electric vehicle exports slipped 1.5% year-on-year.
This reflects the cost advantage hybrids enjoy under the new tariffs. BYD Co., for example, faces a 27% tariff on its battery-electric Atto 3 in the EU, adding more than 10,000 euros ($11,700) to the vehicle’s price. In contrast, the similarly priced plug-in hybrid Seal U faces a tariff of just 3,999 euros. The Seal U was the top-selling plug-in hybrid in Europe in June, with 6,462 units sold.
Despite resilience in green tech, traditional Chinese exports — such as garments, toys and home appliances — remained weak in July, battered by years of U.S. tariffs.
Home appliance exports fell 4.7% by volume and 3.8% by value to $8.3 billion in July. The China Chamber of Commerce for Import and Export of Machinery and Electronic Products estimates that the cumulative U.S. tariff on a home appliance made of 30% steel and aluminum now reaches 67%.
While China’s total exports rose 7.2% year-on-year in dollar terms last month — beating expectations — exports to the U.S. plunged 21.7%, accelerating from a 16.1% drop in June.
Analysts at Minsheng Securities. said in a research note that a brief U.S.-China tariff truce in May triggered a short-lived export rush, which faded by July. The firm attributed China’s overall export growth to a sharp rise in shipments to the EU, Latin America and Africa, as Chinese exporters turn away from the U.S. market.
Source: Caixin Global