Comparing EV Battery Policies in the EU and China: Implications for Innovation, Industrial Development, and Competitiveness

The electric vehicle (EV) battery industry has become a strategic pillar of the low-carbon transition, with far-reaching implications for industrial competitiveness and sustainability. This paper compares the policy mixes governing EV batteries in the EU and China and examines how different approaches shape technological innovation, industrial development, and export performance. A qualitative comparative case study is conducted, combining content analysis of core policy and regulatory documents with descriptive indicators on EV deployment, patenting activity, manufacturing capacity, and international trade. The analysis identifies two distinct but partly complementary policy models. The EU relies on innovation-driven and regulation-based instruments, coupling large research and development programs with stringent sustainability and circular-economy requirements; this model is associated with stronger performance in regulatory upgrading, collaborative innovation, and sustainability-oriented governance. China emphasizes demand expansion, large-scale fiscal support, and long-term industrial planning, which has accelerated capacity build-up, cost reductions, supply-chain integration, and manufacturing-based export competitiveness. The findings show that these contrasting policy mixes generate different technological trajectories and value-chain configurations, while both contribute to strengthening strategic competitiveness in the EV battery sector. More broadly, the study demonstrates that policy effectiveness depends less on any single instrument than on the coherence of the overall policy mix. It concludes that effective EV battery strategies should combine strong innovation incentives with mechanisms that support industrial scaling, supply-chain resilience, and high environmental standards.