BEIJING, Feb 29 Reuters Chinese outbound foreign direct investment along the electric vehicle value chain likely set a new record in 2023, a report from Rhodium Group showed, as western economies step up scrutiny of China39;s productionfocussed, debt driven development model.

Growing alarm over Chinese industrial overcapacity flooding the European Union with cheap products, particularly electric vehicles, is opening a new front in the West39;s trade war with Beijing, which began with Washington39;s import tariffs in 2018.

Chinese firms put 28.2 billion into EVrelated industries last year, the report said, which falls short of the 29.7 billion spent in 2022 but does not include several bigticket projects with no known price tag, such as BYD39;s Hungary plant and Gotion39;s 25 stake in a Slovakian battery producer.

China could be churning out 10 million excess vehicles per year, advisory firm Automobility estimates equivalent to twothirds of all North American output in 2022.

Brussels39; trade policy is now also turning more protective against China. The 27strong trade bloc in September launched a probe into whether China39;s automakers unfairly benefit from state subsidies. And in December, the White House unveiled plans to cut China from its battery supply chain.

These regulatory dynamics have spurred more investment by Chinese producers, who realise that an exportonly strategy could create severe political push back in host economies and cut them out of lucrative…