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Gavekal Technologies: Briefing
A China Tech Report Card
Arthur Kroeber, AJ Cortese, Tom Hancock
9 Sep 2026
Over the past year Gavekal Technologies has tracked China’s progress across a range of tech sectors. Today we take a step back and try to assess its overall capabilities. First, outside a handful of areas, China is still more of a fast follower than a global pace-setter. Second, China’s well-documented manufacturing dominance is mainly in products of medium or low complexity. Finally, China’s tech ecosystem still relies heavily on foreign-sourced components, equipment and intellectual property.
Gavekal Technologies: New Energy
The Deployment Challenge For Cheap Solar
AJ Cortese
31 Aug 2026
For most of the past two decades, the solar story was about making the panel cheaper. China has solved that problem. Thanks to massive excess capacity, Chinese producers are not making much money. With equipment now a commodity, the economic value of solar will mainly come from its installation. The broadest local benefits are likely to come in countries that can figure out how to scale up distributed solar generation at homes and businesses.
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Alibaba’s AI Conundrum
AI-related investments are putting greater pressure on Alibaba Group Holding (Alibaba)’s earnings and cash flow. In the June quarter (calendar 2Q26, Alibaba’s fiscal 1Q27), group revenue rose 9% YoY, but net income dropped 75% YoY.
China Wind Power’s Global Challenge
Chinese wind turbine makers are champions at home but much less visible abroad than their peers in solar, EVs and batteries. A big factor is that the project economics of wind power are unique. Nonetheless, Chinese wind firms are increasingly looking abroad, and are set to do well in price-sensitive emerging markets.
The Next Stage Of The LLM Race
The popular framing of cheap Chinese open-weight models challenging expensive US closed models is becoming less useful as both sides adopt tiered strategies. LLM pricing is increasingly defined by model tier and business strategy rather than a model’s origin. The key questions are whether US labs can advance the frontier fast enough to preserve premium pricing, and whether Chinese labs can convert adoption into durable revenue to sustain frontier development.
The Tech Truce Starts To Fray
In May, presidents Donald Trump and Xi Jinping promised a new era of “constructive strategic stability.” What we have seen since then is a simmering tension, as the US has tried to restrict Chinese tech imports through a series of measures by a new actor, the Federal Communications Commission. China finally responded in early August with a calibrated set of its own restrictions, designed to respond to the US but not to escalate.
China’s Export Engine Meets Europe’s Carbon Rules
Europe’s desire to limit imports of carbon-intensive goods is leading to changes in industrial China. Beijing has launched a set of zero-carbon industrial parks that will tightly link factories with renewable energy sources, helping them cut their carbon footprint and comply with new EU regulations that will tax carbon-intensive steel and aluminum imports and bar entry to batteries that fail to meet carbon limits.
On The Ground At The 2026 World AI Conference (Part II)
The 2026 WAIC showcased thousands of competitive AI products targeting consumer, enterprise, and government adoption. Competition is expanding beyond foundational models toward enterprise solutions and next-generation consumer-AI interfaces, including agentic smartphones and humanoid robots. Despite strong investment, policy support, and expanding pilots, commercialization remains constrained by uncertain revenue models, high computing costs, integration barriers, and uncertain legal frameworks.