Beijing has massive ambitions for electric vehicles (EV), and it seeks 25% of all car sales in the country to be EVs by 2025, Financial Times reports.In 2019, China sold 1.2 million EVs, accounting for more than half of global sales. The China Association of Automobile Manufacturers expects new EV sales to reach 1.1 million by the year-end despite the pandemic, Reuters reports.According to FT, China can leverage its vast scale advantages to make the first EV that can compete with traditional cars on price and tap the international market, which is ready due to growing worries about climate change.The EV industry in China is at a critical juncture. The price of EV batteries is set to drop below $100 per kWh by 2023, down from the current $160.Ev batteries account for a significant portion of the overall car's cost, and the price point below $100 is a cost parity with internal combustion engine cars.Market Leader: Tesla Inc's (NASDAQ: TSLA) Model 3 is the leader in China with sales of 70,951 units in 2020 through August, accounting for 13% of the overall EV sales. However, the Wuling HongGuang Mini EV clocked sale of 9,150 units in August, its second full month of sales.The boxy EV sees huge sales numbers because it comes at $4,200, a fraction of Tesla's $42,691 price tag for Model 3, FT reports.The HonGuang Mini EV is a joint-venture product between General Motors Company (NYSE: GM), SAIC Motor, and Liuzhou Wuling Motors Co Ltd.Nio Inc's (NYSE: NIO) ES6 EV sold 2,840 units in August and 17,161 units in the year through August.Valuation: Observers call the valuation of Chinese EV companies overcooked. The three US-listed Chinese EV start-ups Nio, Li Auto Inc (NASDAQ: LI), and Xpeng Inc (NYSE: XPEV) are valued at $35.4 billion, $15.9 billion, and $14.4 billion respectively, despite all of them making sizeable losses, FT reports.EV makers and component suppliers that are profitable are trading at lofty valuations. The Hong Kong-listed EV and traditional carmaker BYD is trading at a trailing 12-month price-to-earnings (PE) ratio of 245, while the EV battery maker CATL is has a trailing 12-month PE of 117.5.PE valuations are high but still lower than Tesla's PE of 1,045.8, according to Hong Kong-based East Capital fund partner Karine Hirn.When mass-market is reached, China will benefit due to supply chain and scaling advantages, said Hirn.See more from Benzinga * Click here for options trades from Benzinga * Tesla's Regisrations In California Drop 13% In Q3(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.