"The trend is already happening," said Ni Jun, CATL's chief manufacturing officer.

(Ni Jun, CATL's chief manufacturing officer. Image credit: CATL)

China sold 3.5 million NEVs in 2021, and the industry continued to grow in the first quarter of this year, he said, adding that while car sales fell from January to April compared with the same period last year, NEV production capacity more than doubled instead.

From the first-quarter sales, China's NEV penetration rate has reached 20 percent, Ni said.

The European Commission proposed legislation last July that would ban the sale of ICE vehicles in the EU by 2035. Lawmakers on the European Parliament's environment committee backed the plan earlier this month.

In response to the new EU regulation, Volkswagen has announced that it will stop producing all ICE vehicles by 2035.

In April, BYD announced it stopped production and sales of ICE vehicles in March this year to focus on pure electric and plug-in hybrid vehicles.

China is one of the fastest-growing markets for the global NEV industry, with NEV penetration reaching 29.6 percent of wholesale sales in April, according to data released earlier this month by the China Passenger Car Association (CPCA).