When the EV Transition Meets a City That Started Building in 1997
City Intelligence Brief | Wuhu
Wuhu sits on the Yangtze River in southeastern Anhui, approximately two hours from the provincial capital Hefei. Historically it functioned primarily as a logistics node; river transport, agricultural shipments and industrial distribution moving through rather than originating locally.
That position changed in the late 1990s with the creation of Chery Automobile under municipal ownership. The company became the city’s industrial anchor, drawing suppliers, engineering talent, and manufacturing capability into the region.
Wuhu is now entering a third phase. The initial phase centered on survival and industrial establishment. The second phase built the supplier ecosystem. The current phase extends that base into adjacent sectors including electric vehicles, battery systems and low altitude mobility technologies.
In this briefing we examine how that transition is unfolding at ground level.
This is a companion to the deep dive; Wuhu: The City that birthed its own Engine
Where the City Stands
Structural Snapshot
Wuhu’s industrial structure remains anchored by Chery Automobile.
Approximately 40% of the city’s industrial output is tied directly to the automaker. Much of the remaining manufacturing activity exists within its supply chain: materials suppliers, component manufacturers, logistics providers, and engineering services.
The city has moved beyond foundational ecosystem formation. The current strategic focus is stack extension.
Current stack layers include:
• EV vehicle production
• battery manufacturing and materials
• low altitude vehicle development
• manufacturing automation and software
Municipal ownership of Chery remains central. The government operates as a long horizon shareholder rather than purely a regulator, allowing sustained investment cycles that private firms might avoid.
Why Wuhu matters now, these three structural shifts align with the city’s capabilities:
• Electrification of the automotive industry
• Supply chain regionalization
• Declining effectiveness of subsidy driven factory attraction
Wuhu represents a different model: build an anchor first, then allow the ecosystem to accumulate around it.
Whats Shifting on the Ground
Ground Level Pattern Spotting
Observable changes across the city include:
• New research facilities near Chery’s main campus focused on battery systems and low altitude vehicles.
• Drone testing areas on the urban periphery replacing former agricultural land.
• Battery materials suppliers expanding production sites, often doubling the footprint of their initial facilities.
• A privately operated EV technician training academy run by former Chery engineers recently opened and reached capacity quickly.
• Areas along the Yangtze previously used for warehouse storage are being cleared and redeveloped into industrial parks.
• Small combustion era component shops serving legacy suppliers are gradually disappearing as vertically integrated supplier networks replace independent distributors.
• A noticeable talent corridor has formed between Chery’s campus and the emerging drone research cluster. New cafés, shared offices and apartment developments serve younger engineers working in these sectors.
Five years ago the district was primarily residential. It now functions as an informal innovation corridor.
Where the Energy is Moving
Sector Rotation Awareness
Sectors losing gravity:
• Combustion engine component manufacturing
• Exhaust systems and fuel-injection suppliers
• Independent auto parts distributors
Demand for these products continues but growth has stalled as EV production increases.
Sectors gaining gravity:
• EV powertrain systems
• Battery production and materials
• Battery recycling
• Manufacturing automation software
• Drone and eVTOL development
Talent flows reflect the same shift.
New engineering graduates increasingly enter EV or drone companies directly, bypassing combustion era sectors.
Subsidy signals reinforce the rotation.
Anhui’s industrial support programs increasingly target new energy vehicle supply chain integration, a policy category strongly associated with Wuhu.
Where the State is Placing Weight
Institutional Signal Mapping
Government actions indicating strategic prioritization include:
• Establishment of a regional branch of the Anhui Low Altitude Economy Development Office in Wuhu in 2024.
• Provincial procurement rules favor EVs with high local battery sourcing percentages, strengthening the Chery–CATL ecosystem.
• Anhui Normal University’s Wuhu campus launched a battery materials program funded by Chery. Enrollment doubled in its first year.
• A new industrial park has been zoned specifically for new energy vehicle supply chain integration. Land terms are preferential for companies locating within 50 km of Chery’s main plant.
• National Emerging Industries funding was recently allocated to Wuhu for eVTOL component development, an uncommon designation for a non-coastal city.
These signals indicate sustained provincial and national support for Wuhu’s industrial stack.
What Actually Leaves the City
Economic Output Profile
Key outputs leaving Wuhu include:
Finished vehicles
Approximately one million Chery vehicles annually.
Distribution: ~60% domestic market, ~30% emerging markets, ~10% Europe.
EV batteries
Around 45 GWh production capacity through the CATL joint venture. Most supply Chery vehicles; some exported to Southeast Asia.
Automotive components
Roughly ¥22 billion annually, feeding domestic supply chains and select overseas markets including Germany and Mexico.
Drone prototypes
Limited production volumes for domestic testing programs.
Aircraft components
Small batches supplying AVIC’s manufacturing network.
Rising categories:
• battery materials
• eVTOL components
• manufacturing software
Flat categories:
combustion era components such as exhaust systems and transmissions.
Who Should Pay Attention
Who This City Is For
Actors structurally aligned with Wuhu include:
• Battery supply chain companies developing materials, recycling systems and next generation storage technologies.
• Low altitude mobility developers seeking manufacturing partners for drones or eVTOL aircraft.
• Automotive suppliers transitioning from combustion components to EV platforms.
• Research laboratories working on battery chemistry, lightweight materials or flight systems.
• Investors with EV sector expertise able to provide technical knowledge or market access.
• Fleet buyers or regional governments purchasing electric vehicles at scale.
Actors less aligned:
• Consumer brands targeting retail markets.
• Financial services firms seeking headquarters environments.
• Low cost general manufacturing operations.
How to Get in
Access & Participation Channels
Battery suppliers
Locate within 50 km of Chery’s plant and integrate through CATL’s supply chain program. Technical qualification standards are required.
Low altitude developers
Partnerships typically occur through Chery’s aviation initiatives or existing drone programs. Licensing arrangements are more common than joint ventures.
Auto suppliers
Entry occurs through Chery’s supplier certification process. Priority categories involve EV components.
Research collaborators
Joint laboratories with Anhui Normal University or Chery R&D. Partners must contribute intellectual property rather than only funding.
Investors
Participation usually involves Chery spin-offs or supplier expansion rounds. Passive capital plays a limited role.
Buyers
Vehicle procurement through municipal or provincial tenders or direct fleet purchases.
WHAT GETS IN THE WAY
Friction & Constraints
Provincial competition
Hefei, the provincial capital, is building its own EV ecosystem. Over time it could attract suppliers away from Wuhu.
Anchor concentration
Chery still dominates the industrial structure. Economic diversification remains limited.
Coastal competition
Major coastal manufacturing hubs continue investing heavily in EV and battery industries.
Talent constraints
Senior battery engineers are scarce nationwide. Recruitment competition is intense.
Institutional structure
Municipal ownership of the anchor firm creates stability but can slow decision cycles relative to private ecosystems.
Regulatory uncertainty
National regulation for low altitude flight remains incomplete. Industry development may pause until the regulatory framework stabilizes.
What to Watch in the 24–36 Month
Watchpoints
Signals indicating deepening ecosystem strength:
A second major battery manufacturer establishes operations in Wuhu.
An eVTOL developer selects Wuhu for manufacturing.
Chery’s EV exports to Europe exceed 100,000 units annually.
Anhui Normal University’s battery program expands again.
The new industrial park reaches full capacity ahead of schedule.s
Signals indicating competitive pressure:
Provincial EV incentives begin integrating Hefei based suppliers.
A major supplier relocates from Wuhu to Hefei.
National low altitude regulations stall, delaying drone and eVTOL deployment.
Conclusion
Wuhu represents a city organized around a locally created industrial anchor.
The initial task, building the anchor was completed decades ago. The current phase extends that base into batteries, advanced manufacturing and low altitude mobility. The next three years will determine whether the ecosystem can broaden beyond a single core firm while maintaining its manufacturing depth.
For companies operating in EV supply chains, battery technologies and emerging aerial mobility systems, Wuhu remains one of the more structurally aligned environments in China’s interior manufacturing corridor.
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