The electric vehicle (EV) market’s dramatic expansion has significantly altered economic dynamics in locations like Jinhua, China. Over the past ten years, the city has employed state-led investment strategies to bolster EV manufacturers facing financial constraints. This approach was undertaken with the objective of accelerating innovation and fostering growth within the sector.
City-backed funds have acquired shares in various companies operating across the automotive supply chain. This strategic move aimed to ensure the availability of resources, spanning from affordable raw materials to providers of in-car infotainment systems. These resources were readily accessible to local EV factories. This strategy was critical as automakers sought to establish a sustainable and viable business model in the rapidly evolving EV market.
