Subsidies are part of the reason. Definitely not the whole reason, but part of it The Chinese provinces pump a bunch of money in to try to make their region's car manufacturers succeed. And every province is doing it. So you have a bunch of carmakers competing for market while being kept alive, so they do the most rational thing possible to gain share: lower prices.

Of course, they're also just good at building things since they do so much of it. And cheaper labor. Much better supply chain.

> China's EV subsidies are basically identical to US and EU subsidies.

Not really, not much similarities between China and EU subsidies past 15 years. China's NEV subsidies are illegal because they are either conditioned on illegal tech transfer, local content requirement, or restrict market access. To give a high level view of the problems:

1) forced technology transfer/IP theft -- all foreign automakers/EV battery producers forced to give up IP to access China's market (and subsidies). This was litigated before the WTO by the EU in 2018 (see WT/DS549):

  Hybrid in a Trade Squeeze, Keith Bradsher, Sept 5, 2011, NYT

  ... The Chinese government is refusing to let the Volt qualify for subsidies totaling up to $19,300 a car unless G.M. agrees to transfer the engineering secrets for one of the Volt’s three main technologies to a joint venture in China with a Chinese automaker, G.M. officials said.

  Power Play, Trefor Moss, May 17, 2018, WSJ

  ... China requires auto makers to use batteries from one of its approved suppliers if they want to be cleared to mass-produce electric cars and plug-in hybrids and to qualify for subsidies. These suppliers are all Chinese, so such global leaders as South Korea’s LG Chem Ltd and Japan’s Panasonic Corp. are excluded.
  ... Foreign batteries aren’t officially banned in China, but auto executives say that since 2016 they have been warned by government officials that they must use Chinese batteries in their China-built cars, or face repercussions. That has forced them to spend millions of dollars to redesign cars to work with inferior Chinese batteries, they say.
  ... “We want to comply, and we have to comply,” said one executive with a foreign car maker. “There’s no other option.”

  Why a Chinese Company Dominates Electric Car Batteries. Keith Bradsher and Michael Forsythe, Dec 22, 2021, NYT

  The government soon said electric car buyers could get subsidies only if the battery was made by a Chinese company. G.M., which had not been notified of the rule, started shipping Buick Velite electric cars in 2016 with batteries made in China by LG, a South Korean company.
  Angry consumers and dealers complained that local officials were denying them subsidies, people familiar with the episode said. G.M. switched heavily to CATL for the huge Chinese market.

  Why a Chinese Company Dominates Electric Car Batteries.
  ... A rival had released a video suggesting that a technology used by the company, CATL, and other manufacturers could cause car fires. Imitating a Chinese government safety test, the rival had driven a nail through a battery cell, one of many in a typical electric car battery. The cell exploded in a fireball.
  Chinese officials took swift action — by dropping the nail test, according to documents reviewed by The New York Times. The new regulation, released two months later, listed who had drafted it: First on the list, ahead of the government’s own vehicle testing agency, was CATL.

As of this week, EU has over 100+ countervailing measures (anti-dumping/anti-subsidy) in force against Chinese imports, ranging from ceramic tiles (AD560), to decor paper (AD712), to polyester yarn (AD690); in addition to few more dozens of on-going investigations from candles (AD726) to hardwood plywood (AD717).

the international legal standard for subsidies is based on the WTO's Subsidies and Countervailing Measures (SCM) Agreement and related anti-dumping regulation under GATT 1994.

In the US, it's implemented thru 19 U.S.C § 3571. The EU's foreign subsidies are regulated by Regulation (EU) 2016/1037 of the European Parliament and of the Council of 8 June 2016 based on the same WTO SCM Agreement.

While the WTO's regulations don't preclude local subsidy regulation, they must be consistent with the WTO's Agreement. In other word, any gov't subsidy favoring a "specific" company(ies) over domestic, foreign competitors, or distort market competition is an "actionable" offense and can be litigated before the WTO -- agriculture (quota based) and national security are however exempted. Others, such as export subsidies or local content requirement are prohibited under Article 3, "Prohibition" of the SCM.

Yeah, those evil corn subsidies. It's well to remember however that there is no international law against your gov't pissing away your tax payers hard-earned money -- so long as the product remains domestic and doesn't cause injuries to other trading partners.

That's your local political problem.