Chinese EV startups are spending more on research than Tesla is [Video]

BEIJING – U.S.-listed Chinese electric car companies are spending more on research as a ratio to sales than Tesla, according to CNBC analysis of the four automakers’ first-quarter earnings.

It’s a strategy for survival in China’s cutthroat auto market, the largest in the world. New energy vehicles, which include both battery and hybrid-powered cars, have grown rapidly to more than 40% of sales.

Many Chinese automakers already spend as much as or more than their global peers on R&D as a percent of revenue, a significant increase from many years ago, Paul Gong, autos analyst at UBS, told CNBC. “In certain cases, even in terms of absolute dollars, it has bypassed.”

Of the four U.S.-listed Chinese electric car companies, Nioranked first, spending nearly 29% of revenue in the first three months of the year on research and development. That’s far higher …