For the first time in history, Chinese electric vehicle (EV) giants are choosing to pour money into building factories overseas rather than in their home country. This marks a massive wave of exodus, driven by cutthroat domestic competition and towering tariff walls in international markets.

A recent report released by the U.S.-based research firm Rhodium Group on Monday (August 18, 2025), revealed shocking data: EV manufacturing investments inside China have plummeted dramatically.

From a peak of over IDR 1,440 trillion (around USD 90 billion) in 2022, the figure plunged to just IDR 240 trillion (USD 15 billion) by 2024.

For the first time ever, outbound investment “slightly surpassed” the sluggish domestic figure. This is a clear indication that industry leaders such as BYD and Great Wall Motor (GWM) are shifting strategies to survive and expand globally.

Escaping the ‘Bloody War’ at Home

This drastic move is not without reason. China’s EV market has turned into a “bloody battlefield,” with dozens of brands slashing prices and eroding profit margins to near zero just to capture market share. At the same time, Western nations like the European Union and the United States are erecting high tariff barriers to block the influx of cheap Chinese EVs.

The only viable way forward is to establish production bases directly within target markets. “Rising regulatory pressures in regions such as the European Union raise entry barriers and will push more Chinese companies to set up local manufacturing operations,” the Rhodium report noted.

This investment wave is spreading globally. In São Paulo, Brazil, President Luiz Inacio Lula da Silva personally inaugurated a new GWM factory on August 15. Just a month earlier, its long-time rival BYD had already begun production at its first Brazilian plant. In Indonesia, Chinese battery material company GEM committed IDR 4.7 trillion (USD 293 million) to expand its facilities.

Harsh Criticism: Grand Promises at Risk of Collapse

Yet behind the grand narrative of expansion, Rhodium Group issued sharp criticism and a serious warning. These multi-trillion-rupiah investments may be little more than ambitious promises on paper.

The report highlighted a troubling fact: only 25% of all announced overseas factory projects were ever completed, compared to 45% of projects within China. Even worse, overseas projects are twice as likely to be canceled midway.

This makes it a high-stakes gamble. Trillions could evaporate if projects stall due to bureaucratic hurdles, political instability, or flawed business calculations.

Ironically, the threat may even come from Beijing itself. “Chinese companies must also contend with Beijing’s rising concerns over technology leaks, job losses, and the hollowing out of domestic industries,” the report warned. The government could pull the emergency brake at any time if it perceives the exodus as endangering the national economy.

In the end, this global investment surge is a double-edged sword. On one hand, it is a brilliant strategy to dominate the global auto market. On the other, it represents a mass exodus fraught with risks of failure and potential political backlash.

The world—including Indonesia, which has also attracted some of this investment—can only wait and see: will this become a story of global conquest, or an expensive lesson in ambition gone too far?