China is world`s biggest automotive market, by volume. In 2020, the sales of automobiles were 25.3 Million units a drop of 1.9% mainly due to Covid. This was the third year with negative YoY growth, respectively.
Electric vehicles however grew by 10.9% year with 1.4 Million units which showcased a growing demand. Due to Covid, the subsidies were extended for 2 more years with a 10% drop every year. Subsidies were the driving factor in China for high electric vehicle sales
To know more about Global Electric Car Market, read our report
China after spending $3 Billion in subsidy expenditure in 2018 has raised technical threshold for the same. For instance, an EV purchased by a commercial fleet user would be given subsidies only if its aggregated driving range exceeded 20,000km per annum.
Additionally, automakers are required to build platforms for monitoring operational status of vehicles sold and connect them with a national regulation platform that was launched in 2016.
As the EV market slowed down in H2-2019, due to subsidy cut, finally dragging down full year- 2019 EV volumes, the EV startups were most affected. For example, WEY had set itself a target of 100,000 units EV sales but ended up selling just 17% of that.
Xiaomi announces its foray into electric vehicle (EV) sphere in March 2021, the brand is planning to invest about $10 billion over the next decade in manufacturing EVs.
BYD Co Ltd, China’s largest electric vehicle (EV) manufacturer, has announced that it will no longer develop combustion engine vehicles and will instead focus on pure electric and heavily electrified plug-in hybrid vehicles.
In the future, BYD will concentrate on pure electric and plug-in hybrid vehicles.
Smaller, more efficient engines will continue to be employed in plug-in hybrid cars, therefore BYD will not fully quit producing gasoline engines.
Nio is notable for allowing customers to choose between purchasing the battery pack for their electric vehicle entirely or paying a regular fee that enables them access to the manufacturer’s battery switching stations.
This is known as battery-as-a-service (BaaS), and up until now, people who chose it could not opt out by purchasing the battery.
This has since changed in China, as Nao EV customers who regretted selecting for BaaS requested that the manufacturer enable them to purchase the battery afterwards, therefore eliminating the need for battery switching.
Nao issued an official statement in China announcing the change and stating that the group of owners interested in purchasing the pack was still small.
Starting 12th June 2019, when new subsidy rules came into effect, sales of A00 compact EVs dropped sharply pulling down the overall EV volumes by a steep ~50% in July.
It was only post Q3 2019 when almost all car companies upgraded their compact EVs to >250km range that the EV sales started rebounding. In Nov 2019, sales grew ~20% (MOM) and in December it grew by ~70% (MOM).
However in 2020, A00 held more than 20% of the market share. Tier 2 and Tier 3 cities prefer city EVs while Tier 1 cities prefer bigger EVs. Due to Covid , subsidies are extended for 2 more years. Money was also put in to improve infrastructure across the country.
For the first half of 2021, XPeng set up two sales service subsidiaries in Hainan province, which are located in Haikou and Sanya.
Both of them are wholly held by Xiaoping Automobile Sales Co., Ltd., and are allowed to work on car rental service, wholesale of auto parts, roadside assistance service, distribution of used cars, and sale of new energy vehicles and battery swapping facilities.
Full NEV subsidy programmed phase-out postponed from end of 2020 to end of 2022 (from April 2020, NEV subsidy reduction of 10% from 2019-2020, and an additional 20% reduction in 2021).
China electric vehicle market by month
China electric vehicle market is estimated at $49 Billion in 2020. The Chinese EV battery market alone is estimated at $10.4 Billion. To know more about it read our report EV Battery Market in China In 2020, SAIC-GM(2nd biggest EV player in China) will launched 10 new models, including 2 BEVs. By 2025, SAIC-GM will invest $4.5 Billion to launch more than 9 new energy models. BAIC BJEV has developed three EV platforms, BE11, BE22 and BE22, which will underpin more than 30 vehicles by 2025.
As the pandemic began to surge in early 2020, there was a general expectation that electric car markets would likely be more resilient than the general automotive sector although a drop in electric car sales was generally expected nonetheless which may also stimulate future electric vehicle demand especially for large electric cars with better performance.
China, among one of the earliest regions affected by COVID-19 took a great part in the global electric vehicle market and attracts growing attention on its post-pandemic trends in the electric vehicle industry.
Since electric vehicle development was critical to achieve the sustainable goals, the hit of COVID-19 struck the market and brought challenges to the whole industry.
The social distancing trend after pandemic challenged traditional EV distribution channels with dealers, pushing automakers to develop innovative online selling channels.
The travel restrictions caused by COVID-19 have interrupted electric vehicle material supplies that relied on imports, hereby accelerating domestic substitute exploitation and inventory improvement for critical parts.
Additionally, massive lockdowns for controlling COVID-19 have disrupted productions and operations, which tended to expel small brands out of the competitive market, concentrating China’s electric vehicle industry to the leading brands.
China comprised 50% of global EV sales volume in 2016, 2017, 2018 and 2019 and more than 70% of them were BEVs in 2016, 2017, 2018.In 2020, it decreased to 40% of the global share. In 2020, the BEV share went up to 78%. In the commercial vehicle segment, buses comprised 81% of 100k units electric commercial vehicle market, with average battery capacity of 233kWh, pushing China`s installed power battery capacity volume to 84GWh in 2020
China is pushing hard for swappable batteries for electric cars (EVs) as a supplement to conventional vehicle charging, with the government backing multiple companies working on the technology.
Rather than putting the car into a charging station, battery switching allows drivers to easily exchange depleted packs with fully charged ones. Swapping batteries could help reduce the load on power networks as millions of vehicles charge up, but experts warn that it will only take off if batteries become industry-wide standardized.
The world’s largest battery manufacturer, CATL (Contemporary Ampere Technology Company Ltd) of Hinged, was creating switching services not just for China, but also for global markets.
BYD, a Chinese electric vehicle (EV) manufacturer, has inked a strategic collaboration deal with Shell, under which the two companies would collaborate on projects in both China and Europe.
BYD also stated that the two businesses would form a cooperative venture in China to develop a vehicle charging network. The network would start with more than 10,000 electric vehicle charging stations in Shenzhen, with plans to expand to other cities.
The vast electric vehicle market in China is where Chinese internet giant Tencent hopes to provide technology that will assist global automakers looking to sell cars there. Tencent and BMW have already collaborated on projects.
The comprehensive cloud package, which is also accessible to domestic automakers, can handle all technical facets of an electric vehicle. These features range from providing access to Tencent’s social networking and map apps to data storage that is geared for training autonomous driving systems.
Given that Tencent controls several of the biggest Chinese online entertainment apps, the user interface might be a selling factor for drivers in China.
This result is the eighth consecutive monthly record. The previous highest monthly result was 92,823 in December.
The Chinese major, SAIC has plans to start EV manufacturing in India and Thailand. Since SAIC is well positioned to absorb the higher cost and low margin of EVs presently, we believe it can boost EV uptake in both India and ASEAN region. BYD(18% market share in EV passenger cars) declined by 4% YOY to 219,000 units in 2019. It had 9% share of Electric bus market in China.
© Copyright 2017-2023. Mobility Foresights. All Rights Reserved.