Introducing involution
There’s a paradox emerging in the world of electric vehicles, and it centres on a concept that’s taken hold in China: involution. The term describes a kind of self-defeating competition where everyone works harder and offers more, yet no one actually gets ahead. In China’s cutthroat EV market, manufacturers are locked in an arms race of features—each brand adding screens, sensors, cameras, and capabilities to stand out.
When I say cutthroat, what do I mean? In 2018 there were hundreds of EV start-ups registered. It is forecast that by 2030 as few as 50 might remain. Statistics are variable but even now only a handful of Chinese NEV companies are profitable. For the Western OEM, the broader consequence of this is uncomfortable: if every car comes loaded with technology that seems almost free, how do consumers navigate the different tiers of quality?
Technology overload
Step into a Chinese EV showroom (or view any social media review) and you’re confronted with an overwhelming array of features. Heated, cooling and massage seats. Refrigerated compartments. Screens for every passenger. Ambient lighting with infinite colours. Cameras that record your journey. Sensors that detect everything. Advanced driver assistance, which means it almost drives itself. Even gaming and karaoke systems. And all of this in vehicles priced aggressively to win market share in a competitive market.
For Chinese manufacturers, this makes some sense, at least in the short term. Technology is moving apace and in a crowded market where dozens of brands are fighting for attention, having more features than your competitor is an easy message to communicate. Consumers can count screens, compare specifications, and see tangible differences. When BYD adds a feature, NIO feels compelled to match it and add two more and so on it goes extrapolated around an industry moving at breakneck speed.
Tech-tensions
But this creates tension. When technology becomes ubiquitous—when every car has it, and when it’s bundled into already-low prices—what exactly is it worth? If a £25,000 Chinese EV includes features that would have cost £10,000 in options on a German car just three years ago, has technology become more valuable or less? And what are the implications of this?
There’s a genuine danger that this technological abundance is devaluing the very thing manufacturers are competing on. When technology appears to be given away for ‘free’, consumers begin to see it as a baseline expectation rather than a premium feature.
This presents a profound problem for Western manufacturers, particularly premium brands. Their entire business model has traditionally been built on technological differentiation. You paid more for a Mercedes or BMW partly because they had features other cars didn’t. They would introduce innovations first (adaptive cruise control, advanced navigation systems, sophisticated driver assistance) and these features would help justify premium prices. Eventually, these technologies would trickle down to mass-market brands, but there was always a comfortable gap where luxury manufacturers could charge for being first and best.
Chinese manufacturers aren’t following the traditional trickle-down pattern. They’re not waiting for technologies to mature and costs to fall before including them. They’re loading everything into affordable vehicles immediately, treating technology as a loss leader to win market share.
Are we at cognitive capacity?
There is a cognitive limit to how much specification a buyer can process as value. When every brand claims “AI assistance,” “smart connectivity,” and “seamless customisation,” the claims cancel each other out. The consumer stops asking “does this car have it?” and starts assuming every car does. At that point, the feature has ceased to function as a differentiator at all.
For Western car manufacturers, especially premium brands, this creates a significant problem. If technology is everywhere and appears to be low cost, what exactly do they charge premium prices for? The traditional answers of better engineering, superior reliability, refined execution work in a world of the internal combustion engine, but they are harder to sell in an EV (or even Hybrid) centric world. Technology was supposed to be the new battleground for premium positioning, but the Chinese industry has flooded that battlefield to the point where it’s becoming unusable for differentiation.
Consider what this means in practical terms. A luxury manufacturer spends three years developing an advanced voice assistant with natural language processing and contextual understanding. They view this as a premium feature that justifies higher pricing. But by the time they launch, a dozen Chinese brands already offer similar capabilities as standard – and much of the time they also do it better.
Technological commodification
What we’re witnessing is the commodification of automotive technology.
But the speed of commodification is accelerating, and it’s happening before premium manufacturers have had time to recoup their investment in developing their technologies. They’re caught in a spiral where the features they spent billions developing become expected baseline capabilities before they can profit from them.
Worse, because Chinese manufacturers are often willing to offer these technologies at or below cost to win market share, they’re setting consumer price expectations artificially low. Customers begin to believe that all this technology should be nearly free, making it nearly impossible for other manufacturers to charge appropriately for the actual development and quality costs.
The question facing legacy OEMs is how to respond to this? The instinct will be to compete on the same terms and to add more technology features and specifications to play the Chinese industry at its own game. But that instinct is wrong. You cannot outrun a competitor who is willing to sell below cost in order to win market share. The arms race is a trap, and walking further into it accelerates the devaluation of the very things premium brands depend on.
The more productive shift is one of consumer emphasis, from driver to user. The distinction matters more than it might appear. The automotive industry has spent a century thinking about the person behind the wheel: how the drive feels, how the vehicle performs, how the machine responds to inputs. That framing made sense when differentiation lived in the mechanical experience. It makes less sense in a world where the vehicle is increasingly a connected, software-defined environment.
Users are not primarily asking how the car drives. They are asking how it fits into their lives. How does it help them manage their time? How does it connect to their other devices and services? How can it anticipate user need? For all their feature proliferation, these are questions that Chinese manufacturers have not yet answered convincingly at the premium level. The opportunity for Western legacy brands is to out-curate the Chinese competition, not to match them feature for feature.
Time for a reframing?
This means reframing what premium technology actually is. Not the quantity of features, but the quality of their integration. Not “we have this capability” but “we’ve made this capability effortless, invisible, and genuinely useful in the context of how you actually live.” Apple understood this principle when it entered markets full of more technically capable competitors. The automotive industry needs to learn the same lesson.
The brands that survive this period of involution will be those that resist the feature arms race and build instead around a different kind of value, one grounded in user focus and how the vehicle fits into a connected life. This is not a story that can be told via a lengthy specification sheet. But it is the only story worth telling. It provides an off-ramp from the current technology war and can re-frame how OEMs move towards a software centric and even autonomous future.
