Gasgoo Munich- On May 21, 2026, the 6th International Forum on Automotive Power Systems opened as scheduled. Hosted by Horse Powertrain, it is a leading voice in the sector. This year’s forum was themed "Diverse Drive · Innovation Leading." It brought together global experts and leaders from government, enterprises, and academia. Attendees exchanged views on markets, technology, and strategy amid shifting global demands.
Image Source: 6th International Forum on Automotive Power Systems
A notable shift emerged this year. Fierce debates from five years ago over "whether to transform" have vanished. They are replaced by a confirmed consensus: powertrains are diversifying. Hybrid technology is now a core pillar. Expanding overseas is no longer optional for Chinese automakers; it is imperative. The central question is how to achieve steady, long-term growth globally.
With Consensus on Powertrain Diversity, Efficient Hybrids Go Mainstream
Geely Auto Senior Vice President Wang Ruiping presented striking figures during the keynote. Global auto sales reached 96.5 million units in 2025. This was a 1.3% year-on-year increase. Sales in China climbed 9.4% to 34.4 million. Markets are betting differently on HEVs, PHEVs, and BEVs. However, the overall trend is moving clearly toward diversification.
A closer look at 2025 global sales data reveals a clear signal. Hybrid sales, including HEVs, PHEVs, and REEVs, surpassed pure battery-electric vehicles. This suggests hybrid technology has become a mainstream choice. It was once widely dismissed as a "transitional" solution. This is not a regional anomaly but a global trend.
In China, the hybrid share hit 21.7% in 2025. Adding pure electrics raises the new-energy vehicle penetration rate to 57%.
"China has shifted from policy-driven to customer-driven demand," said Zhao Fucheng. He is CTO of Horse Powertrain and CEO of Aurora Bay. "Consumers are buying hybrids not because of subsidies, but because the products themselves are competitive."
His analysis points to a rapid shift in the mid-to-large SUV segment. PHEVs are fast replacing REEVs. Range-extended vehicles carved a niche in the D/E-class luxury market in 2024. They peaked at a 62% share. However, the landscape was rewritten by competitive PHEV products from Geely and Chery. By 2025, the PHEV share in the large SUV market rose significantly. REEVs began to retreat. "The market is returning to the essence of technology. Efficient hybrid technology is the key to long-term competitiveness."
Globally, while regional powertrain strategies differ significantly, hybrids are gaining traction in almost every major market.
Data shows Europe’s electrification rate reached 28% in 2025. BEVs are growing fastest. HEVs and PHEVs are also seeing steady gains. The region’s overall rate is expected to exceed 50% by 2030. HEVs and PHEVs should account for nearly 17% of the mix.
North America presents a distinct profile. The electrification rate hit 21% in 2025. It is projected to approach 50% by 2030. Yet the fastest-growing segment is not pure electrics; it is hybrids. By 2030, the hybrid penetration rate in North America is expected to reach 26%. This significantly outpaces the projected growth rate for BEVs.
Southeast Asia has seen dramatic changes over the past three years. Electrification started late but is accelerating rapidly. It reached a 15% penetration rate in 2025. It is expected to hit 36% by 2030. Hybrid development follows two tracks. BEVs are growing from 8% to 16%. HEVs are rising from 6% to 15%. PHEV share remains low. This is a result of Japanese automakers’ deep cultivation of HEV technology.
Electrification is just starting in South America. The penetration rate was 2% in 2025. It is projected to reach 16% by 2030. Due to underdeveloped charging infrastructure, hybrids are becoming the primary growth driver. Of that 16% electrification rate by 2030, BEVs are expected to account for just 3%. PHEVs will be at 8% and HEVs at 5%.
Image Source: Horse Powertrain
Global automakers are making substantive adjustments to their electrification strategies. Zhao Fucheng cited comparison data. Between 2024 and 2026, European automakers like Volvo and Audi lowered BEV production expectations. They raised the share of hybrids. U.S. automakers cut BEV forecasts by more than 50%. Japanese companies continue to focus on the HEV route. Clearly, the global market is shifting from a "pure EV single track" to a "hybrid multi-track" approach.
Multiple factors are driving this shift. For consumers, BEVs excel at urban commuting. However, range anxiety persists for long-distance travel. This is especially true in cold climates or areas with poor charging. Hybrids offer fuel and emission savings without altering driving habits. For automakers, BEV development and production costs remain high. Many models still operate at a loss. Hybrids benefit from lower marginal costs and better profit margins. They are built on traditional internal combustion engine platforms. On the policy front, some EU states have proposed revisions to the ICE ban timeline. This grants hybrids a longer window of opportunity.
Addressing industry anxiety regarding solid-state batteries, Zhao Fucheng responded with a forecast. It is based on long-term research. Constrained by cost and engineering bottlenecks, all-solid-state battery penetration is expected to be only around 1% by 2030. It will not exceed 5% before 2035. "Solid-state batteries are still at the intersection of science and engineering. The hybrid route remains a core development direction for the future passenger vehicle market."
Going Global: From Strategic Option to Survival Imperative
If going global was once merely the "icing on the cake," 2025 data has rewritten that logic.
Goldman Sachs data shows domestic profit margins for Chinese automakers stood at 2.1% in 2025. They are expected to slide to 0.5% in 2026 as raw material prices rise. In contrast, profit margins on overseas exports are 40% higher than domestic levels. This makes exports the primary profit source for automakers.
Consequently, Zhao Fucheng emphasized at the forum: "Overseas expansion is a necessary condition for the survival of Chinese automakers. It is not an option."
In 2025, China’s automobile exports reached 7.1 million units. This was a 20% year-on-year increase. It secured the top global spot for the third consecutive year. New-energy vehicles were the core driver. Pure electric sales grew 60% and plug-in hybrids surged 200%. Based on the trend of the first four months of 2026, exports hit 3.28 million units. This is a 52% increase. Experts believe full-year exports could exceed 10 million units. Chinese brands reached a 27.9% global brand market share. They are closing in on Europe’s 28.3% and surpassing Japan’s 24.3%.
Yet, behind this leap in scale lie significant challenges.
Wang Ruiping pointed out that compliance is the first major hurdle. Carbon emission regulations for 2030 in Europe and the U.S. are equivalent to 2 liters per 100 kilometers. This compares to 3 liters for China and Japan. The EU will implement Euro 7 in November 2026. The U.S. will roll out new Tier 4 regulations in early 2027. China plans to pilot National VII standards in key regions in early 2028. Full implementation is set for 2029. Euro 7 imposes stricter requirements on cold-start emissions and particulate matter. The U.S. Tier 4-Bin 30 standard is considered one of the most challenging in effect.
Second, ESG compliance is a hard threshold abroad. The EU has CSRD, CBAM, and CSDDD. The U.S. has SEC climate disclosure rules and the Uyghur Forced Labor Prevention Act. Regulatory systems vary widely by country.
Differences at the application level are easily overlooked. Europe has clear requirements for towing capacity. Output torque must be high enough to pull trailers over two tons. This influences engine and transmission torque characteristics. Fuel quality differences are equally critical. Not all markets use 92-octane gasoline; some use 89. Sulfur and olefin content also varies. In Southeast Asia and Latin America, imperfect power infrastructure leads to voltage fluctuations. High-temperature and high-humidity environments demand higher reliability from electronic systems.
Localization is another major challenge. Wang Ruiping cautioned against focusing solely on tariffs. Various regions impose different local taxes, such as consumption and luxury taxes. Comprehensive tax rates can reach 45% to 75%. North America also requires the use of local suppliers for components. Therefore, regionalization combined with localization is the inevitable path forward.
On the technological front, global companies have decades of experience. They possess a deeper understanding of overseas regulations than Chinese firms. "In these emerging technology fields, we still need to work hard. We must maintain continuous innovation leadership."
Globalization: Not Simple Export, but Systemic Capability Output
With the challenges clear, finding a way to break through is critical. Experts agree that the essence of going global is not merely exporting. It is operating globally. This requires systemic capabilities spanning compliance, R&D, supply chain, and service.
The emergence of Horse Powertrain directly addresses this need. It is a joint venture between Geely, Renault, and Aramco. The company integrates Geely’s former Aurora Bay division with Renault’s Horse unit. Headquartered in the UK, it operates five R&D centers and 18 manufacturing bases. It has annual sales of 8 million powertrain units. Revenue is approximately 15 billion euros. It covers 130 countries.
Image Source: Horse Powertrain
As a third-party powertrain company, Horse Powertrain’s value is not in launching a single product. It lies in providing full-chain capability. This covers compliance, development, and delivery.
According to Zhao Fucheng, ESG is not mandatory in China. However, every global market has different regulatory requirements. This makes ESG compliance a mandatory question. It is often urgent. Horse Powertrain has a long history in this area. In 2022, Geely required Aurora Bay to build its ESG system according to global standards. By 2026, Geely ranked fifth in the S&P Global Sustainability Assessment. This capability aligns with Horse Powertrain’s global strategy.
To address the U.S. Tier 4-Bin 30 standard, Horse Powertrain developed CSC cold-start catalytic technology. It is currently one of the most challenging standards. This solution outperforms electric heating methods. It is ready for mass production at any time. Furthermore, the company leads in low-cost emission solutions. It keeps precious metal content at industry-low levels. Looking ahead, Horse Powertrain has reserved NOx control technology. It requires no additional urea injection. It is ready for immediate industrialization.
Global resource integration serves as the underlying support. With R&D centers in Sweden, Spain, Brazil, Romania, and China, Horse Powertrain has unified global testing standards. It achieves the capability to "develop once, adapt globally." All localization and territorialization requirements are in its core technical specifications.
Supply chain management is equally systematic. Trade barriers and geopolitical risks cannot be resolved simply by calling in suppliers. Local procurement requirements add complexity. Leveraging bases across nine countries, Horse Powertrain built a specific system. It is characterized by a multi-center layout and localized production. It features full-chain collaboration. This gives it the capability to deliver optimal supply solutions.
Aligning with the trend toward global powertrain diversification, Horse Powertrain laid out a range of technologies. These include internal combustion engines, hybrids, and range extenders. It offers a full suite of capabilities. This ranges from components to assemblies. It covers battery BMS to intake and exhaust systems. It can even convert entire vehicles to x-HEV configurations.
On the engine front, displacements range from 1.0L to 3.0L. Small-displacement models target Southeast Asia, India, and South America. The 1.5L engine is planned for future launch in India. In terms of thermal efficiency, Horse Powertrain’s mass-produced hybrid engines are at industry-leading levels. Zhao Fucheng noted that 50% thermal efficiency is a research target. The key is achieving it without significantly increasing costs. Otherwise, economic viability is lost.
The hybrid transmission lineup covers a complete sequence from one to four gears. Motor power ranges from 75 kW to over 300 kW. This satisfies the needs of more than 80% of global OEMs. The latest 900V high-voltage system has been deployed in the ZEEKR 9X. It features a 145 kW P1 motor and a 290 kW P3 motor. The 2.0T engine direct-drive solution achieves 16% fuel savings during high-speed cruising. It offers consistent acceleration performance, regardless of battery charge.
Looking ahead, Horse Powertrain is focusing on integration, high voltage, miniaturization, and lightweighting. The new ultra-hybrid platform DHTS-X boasts a generalization rate of over 80%. It uses modular design. With options like OD and silicon carbide, it meets diverse customer needs.
Summary:
"If you want to go fast, go alone. If you want to go far, go together." Fu Yuwu cited this ancient proverb. He is the Honorary Chairman of SAE-China. The proverb feels particularly relevant today.
The automotive industry is highly globalized. Expanding overseas is a necessity for Chinese enterprises. The Chinese powertrain industry is undergoing a leap. It is moving from "technological self-reliance" to "global empowerment." Whether aligning technical standards or navigating compliance, a single enterprise is insufficient. The emergence of third-party platforms like Horse Powertrain answers this need for synergy.
While this forum did not provide a "master key" for powertrain globalization, it clarified a basic fact. The difficulty of going overseas has been underestimated by many. Only enterprises willing to make long-term investments in compliance will survive. They must invest in technology and localization as well.
