Changan Automobile's Strategic Positioning in China's EV Transition and Supply Chain Resilience: A Path to Sustained Growth

China's electric vehicle (EV) market has reached a tipping point, with plug-in vehicles accounting for 53% of new car sales in June 2025, according to an AutoCango report. Amid this transformation, Changan Automobile has emerged as a formidable player, leveraging strategic partnerships, technological innovation, and supply chain agility to secure its position in the new energy vehicle (NEV) era. For investors, the company's accelerating domestic market share and production growth-coupled with its global ambitions-present a compelling case for long-term value creation.

Strategic Positioning: From Domestic Dominance to Global Ambitions

Changan's 2025 blueprint underscores its ambition to dominate China's NEV sector while expanding internationally. By July 2025, the company held the fifth-largest share of China's overall car market, with year-on-year sales growth of 7.1%, according to Focus2move data. In the EV segment specifically, Changan maintained its fifth-place ranking, reflecting its ability to compete with legacy automakers and tech-savvy rivals. This success is driven by its "Dubhe Plan 2.0," a strategy centered on software-defined vehicles (SDVs), autonomous driving, and advanced battery technology.

The company's collaboration with Huawei and CATL (China's leading battery manufacturer) has been pivotal. These partnerships have enabled Changan to integrate cutting-edge smart cockpit systems and high-energy-density batteries into its Deepal and Qiyuan brands, which accounted for much of its 2024 sales surge, according to an AutoChina briefing. In 2024, Changan sold 2.683 million units globally, with NEV sales jumping 52.4% year-on-year to 733,000 units. By 2025, it aims to sell 3 million units, including 1 million NEVs and 1 million exported vehicles-a target that aligns with China's broader EV industry forecast, according to a China EV industry report projecting a compound annual growth rate (CAGR) of 6.59% through 2033.

Changan's global expansion is equally ambitious. A new plant in Thailand, set to begin operations in Q1 2025 with 100,000 annual units of capacity, will serve as a regional hub for Southeast Asia, Europe, the Middle East, and Africa. By 2030, the company aims to sell 1.5 million units overseas, a fivefold increase from 2024's 536,000 units. This geographic diversification not only mitigates domestic market saturation risks but also positions Changan to capitalize on emerging EV demand in regions with less mature automotive ecosystems.

Supply Chain Resilience: Innovation and Diversification in a Volatile Era

The EV transition has exposed automakers to supply chain vulnerabilities, from raw material shortages to geopolitical tariffs. Changan's response has been twofold: technological self-reliance and strategic supply chain adjustments.

First, the company is investing heavily in R&D to reduce dependency on external suppliers. Over the next five years, it plans to allocate 20 billion yuan ($2.8 billion) to advance AI-driven large models and end-to-end autonomous driving, according to an Auto Shanghai release. This includes developing solid-state batteries for mass production by 2027, a move that could insulate it from lithium price volatility. Changan's "Shangri-La Mission" further underscores this focus, with plans to launch 20 new models in 2025, including 12 NEVs.

Second, Changan is adopting flexible inventory management and sourcing diversification. Unlike the traditional 90-day stock model, the company now adjusts production volumes in real time to align with fluctuating demand, as highlighted in a S&P Global analysis. It is also diversifying its supply of rare earth elements and investing in recycling technologies to meet ESG standards and mitigate risks from U.S.-China trade tensions, according to a Resilinc special report. These strategies mirror broader industry trends but are executed with particular rigor at Changan, which filed 14,000 patents in the past three years-a testament to its innovation-driven approach.

Risks and Opportunities

While Changan's trajectory is impressive, challenges remain. Intense competition in China's NEV market, where prices have collapsed due to overcapacity, could pressure margins. Additionally, geopolitical risks-such as U.S. tariffs on Chinese EVs-may complicate its global expansion. However, Changan's dual focus on domestic scale and international diversification, combined with its supply chain resilience, positions it to navigate these headwinds.

For investors, the company's 2025 targets-3 million global sales, ¥300 billion in revenue, and a 10% R&D investment growth-signal a disciplined path to profitability. Its early mover advantage in SDVs and solid-state batteries could further widen margins as these technologies mature.

Conclusion

Changan Automobile's strategic positioning in China's EV transition is a masterclass in balancing innovation, scale, and resilience. By aligning its Dubhe Plan 2.0 with global demand trends and fortifying its supply chains against disruptions, the company is not only capturing domestic market share but also laying the groundwork for sustained international growth. For investors seeking exposure to the EV revolution, Changan offers a compelling blend of ambition, execution, and adaptability.