The Chinese New Energy Vehicle market China EV Sales for H1 2017

The Chinese New Energy Vehicle market China EV Sales for H1 2017

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THE CHINESE NEW ENERGY VEHICLE MARKET H1 2017

China EV Sales H1 2017, a summary

We look at the Top brands and models, the gainers and losers and how the battle between battery electric (BEV) and plug-in hybrid (PHEV) technologies play out in the summary of China EV Sales H1 2017.

The highlights for Chinese electric car sales in H1 2017 was:

  • Chinese EV Sales grew by 38.3% Year-on-Year or by more than 44,000 units over the same period in 2016;
  • The H1 2017 semester got off to a bad start with one of the worst months in the last three years but recovered with the months of May and June registering the third and fourth best sales ever.
  • More than four pure electric vehicles were sold for every plug-in hybrid in a market where there are 44 BEV models available to the consumer and only fifteen PHEVs;
  • Twenty new models, most of them BEV’s, were available to consumers in this semester compared to the same period in 2016;
  • The Top 2 EV Brands in the China remained the same but one of last year’s top performers, JAC, spectacularly fell out of the Top 3.

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

The Top Electric Vehicle Brands for 2017 H1 in China

 

The Top 3 EV brands in China for the first half of 2017 were BYD, BAIC, and Zhidou. Although BYD hung on to its first place, it sees its lead evaporate. BYD hardly registered any sales in the January 2017, and lost sales in its top performing Qin and Tang model ranges to competing new models from BAIC, Chery, and SAIC Roewe. BYD, one of the largest EV brands in the world, is seeing its position as China’s best performing EV brand challenged as it lost over 20% of its sales compared to 2016, while its competitor BAIC more doubled its sales. BAIC benefited from exciting new models entering the market in the last 12 months, with its small hatch, the BAIC EC180 being a top performer for three of the six months ending up the second best selling EV for the semester. Smaller EVs, or City cars, have also performed very well with the popular Zhidou Geely D2 selling nearly 20,000 units. Another brand with small EV models, Zotye, was placed fourth due to the popularity of its Cloud 100, E200 and E30 models. Other Top 10 Chinese EV brands selling city cars included Chery and JMC, both placed in the Top 10. Although JAC brought the exciting JAC iEV6S small SUV to market it was not enough to withstand the onslaught of its peers, crashing out of the Top 3 to the eight position. Tesla also entered the Top 10 list with the Model X performing very well (please note the June 2017 Tesla data did not make it in time for our analysis, which would have aided the brand’s performance). Western brands such as Volvo, BMW through its local partner BMW Brilliance, Daimler and GM mostly gave up market share to Chinese-produced vehicles.

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

 

The Top Electric Vehicle Models for 2017 H1 in China

Twenty new EV models entered the Chinese EV market in the first half of 2017 but only three, the BAIC EC180, SAIC Roewe eRX5 and BYD Song DM, made it to the Top 10 list of electric vehicles in China. None of last years Top 5 could hang on to their positions with two of the new models, the BAIC EC180 and SAIC Roewe eRX5, entering the market with Top 5 positions within three months from being launched. Last year’s Top 3 EVs, the BYD Tang, BAIC E200, and BYD Qin all crashed out, with the BYD Tang the only model able to hold on to a Top 10 position. Plug-in Hybrid vehicles could only muster three positions in the Top 20 as small city EVs made up more than half of the units sold in 2017 to date. The popular SUV class accounted for 26% of the units sold in the Top 20 list of EVs in China while plug-in hybrids only accounted for 16% of all the EVs sold. New electric vehicle models made up 31% of all the EVs sold during the period under review.

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

 

Electric Vehicle Models for 2017 H1 in China, the losers

BYD’s ailing fortunes are clear in the list of losers for the first half of 2017 but another popular EV brand from 2016, Kandi, saw diminishing sales as its Kandi K17 Cyclone could not compete with the host of new small city cars entering the Chinese EV market. Clear again is the composition of plug-in hybrids and foreign brands in the list of the worst performing electric cars.

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

 

The battle between BEV and PHEV models in China

Plug-in hybrid models are losing the battle in China, strange though that 35% of the new models launched in the last 12 months are PHEVs. In the comparable period in 2016 plug-in electric vehicles made up 33% of all the units sold while the vehicle type only contributed to 16% of all sales in 2017.

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

A detailed breakdown of all electric vehicles sold in China for the first half of 2017

 

The Chinese New Energy Vehicle market: China EV Sales for H1 2017

Be sure to check out our new presentation of all EVs since 2010 to gain great insights on all auto brands and their electric vehicle strategies. We have also created presentations per technology type BEV, PHEV, and FCEV.

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Introducing Chinese electric car brands – BAIC and sub-brand BJEV

Introducing Chinese electric car brands – BAIC and sub-brand BJEV

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Beijing Automotive Industry Holding Co. Ltd (BAIC) is 60% owned by the Chinese Government. BAIC spun its electric vehicle business into a separate unit, Beijing Electric Vehicle Company (BJEV). The company raised $460mln in and IPO for its Electric Vehicle unit, drawing investors such as LE Holdings, the Chinese company with ties to Faraday Future and LeAuto. The BJEV factory is situated in Caiyu, Daxing, Beijing. The vehicle bodies are welded in Zhuzhou Hunan province. BJEV has launched its new range of EV’s, called Arcfox. BJEV unveiled its first concept vehicles for the Arcfox sub-brand in 2016 which comprised of the tiny open top SUV, the Arcfox-1 and the performance model the Arcfox-7 which is based on the Formula E platform of the NextEV Racing team.

BAIC was founded in September 2010 and tried to acquire the intellectual property rights of GM unit, SAAB Automobile’s in 2009 for $200m but failed. The German company, Daimler AG, acquired a 12% shareholding in BAIC during November 2013. BAIC produces some of the best-selling electric vehicles in the country, the E150/160/200 series, the EU260, and EC180 which is the top seller for 2017. The Daimler influence is clear in the design of the new BAIC EU260 model, which looks similar to the Mercedes C series.

BAIC BJEV was one of the first automakers to qualify for an electric vehicle production certificate from the Chinese Government in 2016 as part of the Chinese New Energy Vehicle Program to regulate the EV sector.

BAIC BJEV is now in its third generation of EV technology and is the best-selling electric vehicle auto company in China. The company announced an aggressive five-year plan in 2016 whereby it aims to sell 500,000 per annum by 2020. At the end of 2015, the company was the fourth largest EV manufacturer in the world and has since improved its performance with a 156% jump in sales in 2016, putting it ahead of BYD. The company is planning the launch of the Arcfox 1 in 2017 followed by other pure electric models the BAIC Senova EX260 SUV and BAIC EH300. 2018 will see the release of BAIC EH300L SUV EV and EX400L SUV.

list electric vehicles baic bjev electric car models

Click through to the BAIC’s page on wattEV2Buy to explore the past, present and future EV models by the Chinese automaker.

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How successful is the Chinese New Energy Vehicles Program?

How successful is the Chinese New Energy Vehicles Program?

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45% of Chinese EV makers sold less than 500 models per year

 

The recent Chinese Auditor General’s report on the Central Governments budget for the implementation of its New Energy Vehicles (NEVs) program has delivered some mixed results. The State’s Auditing Administration found some disturbing results from its inspection of 66 companies producing new energy vehicles including passenger vehicles, buses, and commercial vehicles. One has to ask yourself how successful has the program been when finding that 2,200 vehicles out of 35,500 produced by 13 companies were left unsold for a period of longer than a year? How successful has the program been to alleviate pollution in cities if 17,200 of the 35,500 traveled less than 3,000km (1,875 miles) in a year?

The program to promote NEVs was established in 2010 to form part of China’s 12th 5-year plan running from 2011 to 2015. The program had a budget of RMB 100 billion ($14.4 Billion) which included the promotion of EVs through subsidies, development of a charging network, and manufacturing incentives. In 2016 the country cracked down on the rampant abuse of the system by handing down fines totaling $150 million and closing five of the worst offenders. In total, the Audit Administration’s report found, that subsidies to the tune of RMB 1.67 Billion ($240 million) were overpaid due to cheating, which is nearly half the entire budget of eight provincial funds.

The Minister of Industry and Information Technology was quoted in January 2017 that China aims to quadruple its NEV fleet to 2 million units by 2020 and have one in five cars as EVs by 2025, which is expected to be 7 million EVs. The report found that in some cases the subsidies might have been too effective in targeting the development of NEVs. In a sample of around 6,800 units from 13 companies, it was found that more than half was buses, which received subsidies of 70% of the units sales price or higher, skewing the intended outcome away from passenger vehicles.

In January 2017 the Government cracked down on the sector by capping the total subsidies available at the Local Government level at 50% of that of the Central Government, dropping the NEV subsidy by 20% effective 1 January 2017, and raising the technology threshold of distance per charge and energy consumption. The new subsidy at Central Government level is now 44,000 yuan ($6,333) for EVs with a range greater than 250km (156 miles), down from 60,000 yuan ($8,600). The subsidy for buses was capped at 300,000 yuan (43,000) down from 500,000 yuan ($72,000). The sudden crackdown led to a crash in NEV sales for January 2017 of below 8,000 units compared to a full year total for 2016 of around 500,000 units. The sector has since recovered but is not expected to reach the stellar growth that it needs to outpace 2016 by double digits.

Other headline figures from the Auditor’s report shows that 45% of EV makers sold less than 500 models per year, which is a justification for the country implementing a production certificate system. The permitting of automakers to produce EVs have reached its current limit of 15 production certificates when JAC received authorisation for its 100,000 units per annum plant.

On the positive side, the Auditor found that Chinese automakers are starting to dominate the world market for electric vehicles as three, BYD, Geely, and BAIC rank in the top ten by EV sales list. Auto parts companies such as CATL, a battery manufacturer, and Jing-Jin Electric, a manufacturer of drivetrains for EVs have become internationally known for their products.

Going forward the Chinese Government is changing tact from a carrot and stick approach by promoting NEVs through subsidies and regulation to relying more on the stick by introducing more stringent NEV quotas on auto manufacturers from 2018. The Chinese authorities had a visit in June 2017 from the California Resource Board, to co-operate on the proposed Chinese ZEV quotas. The Californian Resource Board was responsible for the state’s much hailed Zero Emission Vehicle (ZEV) framework. The proposed Chinese ZEV quotas are set to require auto manufacturers to have ZEV’s contribute 8% of their sales in 2018 and increase annually by 2% to reach 12% in 2020.

 

Picture: Workers assemble new-energy cars at a workshop of Weidong New-Energy Car Co Ltd in Zouping, Shandong province. [Photo/China Daily]

Be sure to check out our new presentation of all EVs since 2010 to gain great insights on all auto brands and their electric vehicle strategies. We have also created presentations per technology type BEV, PHEV, and FCEV.

nterested in learning more about Chinese electric vehicles? Download our fun and easy app below, flick the China switch and swipe left the models you don’t like, right the ones you do, enter the chat rooms and share your thoughts with the community.

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Introducing Chinese electric car brands – GAC Motors

Introducing Chinese electric car brands – GAC Motors

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The relatively young GAC Motors is one of China’s best-respected vehicle brands. The company has a defined EV strategy and will add three models to its EV fleet in 2017.

Guangzhou Automobile Group Topped the “2016 BEST CHINESE CAR BRAND” Customer satisfaction survey.

Guangzhou Automobile Group Co, Ltd. founded in 2005 has various Joint Ventures with large international auto manufacturers such as Toyota, Hino, and Honda. Wanxiang Group, a large auto-parts manufacturer, and owner of Karma Automotive, previously known as Fisker Automotive, is one of the founding shareholders.

GAC MOTOR established its New Energy division at the end of 2015. The division focused on developing its R&D and production to penetrate the growing Chinese market for EV’s. The New Energy strategy is supported by GAC Group’s “1513” new-energy development strategy which makes the development of an R & D platform, R & D of core technologies a key development direction for its products.

GAC has international ambitions and aims to establish sales and service networks in 14 countries, including North America, Africa, South and Eastern Europe and South East Asia. GAC has reaped the rewards of creating a world-class vehicle brand and sold more than 380,000 vehicles in 2016, compared to around 194,000 the previous year, and has achieved 80 percent compound annual growth rate from 2011 to 2016. The company expects to sell 500,000 cars in 2017 and plans to produce 1 million cars in 2020. The Group targets 200,000 new energy vehicles in 2020 and meeting fuel consumption targets of 5.0L/100Km over its model range. In 2016 GAC Trumpchi delivered a total of 3,378 units of its GA5 PHEV model, an increase of 167% on 2015.

To support its strategy, Guangzhou Automobile Group passed two resolutions impacting EV development at its Board of Directors meeting on June 5th, 2017.

  1. It was resolved that a new company would be established for the Groups New Energy Vehicle (NEV) program. The company would be named GAC New Energy Automotive Co. Ltd. and would be capitalized to the tune of RMB 300m.
  2. It was further resolved to increase the GAC Motor’s capital with RMB 2.26b to expand its annual EV capacity of 200,000 units by 2020. GAC Motor is launching nine new Trumpchi models, of which three is NEV models, namely the GE3 BEV crossover, GS4 PHEV and GA6 PHEV.

GAC Motors are also pursuing other electric mobility solutions. In February 2016, Guangzhou Lixin Taxi Company owned by GAC Access launched more than 200 Levin twin-engine HEVs into Guangzhou taxi market. Also, GAC Group fully mobilizes the creativity of various business sectors and is actively devoted to new energy and energy conservation and environmental protection. GAC Motors and BYD established a JV in 2015 to co-operate in EV development. As a result, the company launched 400 pure electric buses produced by GAC BYD New Energy Bus Co., Ltd. into Guangzhou public transport system to provide services for citizens. The JV company is 51% owned by GAC and has a registered capital of 300m RMB.

Click through to the GAC Motors page on wattEV2Buy to explore the past, present and future EV models by the Chinese automaker.

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Top 10 EV Countries Q1 EV sales – USA beats China

Top 10 EV Countries Q1 EV sales – USA beats China

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Now that all the Q1 data is in we can do a detailed dissection of the hottest quarter in EV history in which nearly 200,000 electric vehicles was sold. The headline data is that nearly 180,000 EVs were sold in the top 10 EV countries. Battery Electric Vehicles (BEV) wattev2buy top 10 ev countiresoutperformed Plug-in Hybrid Vehicles (PHEV) by a long shot. A total of just over 106,000 BEVs were sold while only around 70,000 PHEVs moved off the dealership floor in the top 10 countries.

One of the standout data points is USA EV sales which overtook China as the best market for electric vehicles in Q1, making the USA the top EV country in Q1. The worst performer was The Netherlands, who fell out of the top 10. The Netherlands disappointing performance over the last couple of quarters does not bode well for the European country was seen, next to Norway, as one of the proponents of the technology. Only last year still did the Dutch Government contemplated a goal to be 100% electric by the middle of the next decade. It is unclear what caused the drop in EV sales in the Netherlands.

When comparing this quarter’s EV sales by country to their respective totals for 2016 one can see that the pace of EV sales picked up in most. If one should expect that by the end of Q1 EV sales should equate to roughly 25% of 2016, it is only China and The Netherlands that are underperforming. Chinese EV sales have lagged in January due to technical factors including a clampdown on EV subsidy fraud and the annual Chinese holiday, in which most industries shut down. Chinese EV sales have picked up the pace in the following months and the quarter still ended up 30% over the same period of the previous year. It can be concluded that EV sales for the first quarter in China are historically weak and Q1 2017’s performance is by now way an indication of a trend. Furthermore, the Chinese Government last week announced a plan to dominate the electric vehicle sector which should help the country to regain its stature. Japan, on the other hand, has picked up the strongest pace and has already achieved EV sales equal to 59% of its total 2016 sales. The Japanese EV market has the least variety of EV models available to consumers, and it is anticipated that the introduction of more models will stimulate the market further. Germany is the second best performer helped by a 77% improvement in EV sales on a year-to-year basis.

The top EV brand in the Top 10 EV Countries is Tesla for the second year running. Tesla announced in its April trading update that it sold just over 25,000 Models S and X globally. It is important to note that the figure repoQ1-2017-brands-wattev2buy-top-10-ev-countriesrted includes vehicles being shipped, while country sales data shows vehicles registered. Toyota is back in the Top 10 list of EV brands on the back of a well-received new Toyota Prius. Chevrolet did not shoot the lights out with its new mass-market EV, the Chevrolet Bolt / Opel Ampera-e. Most of GM’s sales came from the Chevrolet Volt PHEV. The company is criticized for producing a limited amount of the Bolt and is being labeled as a compliance company for that, a term used for auto manufacturers that only sell EVs in Zero Emission states to gain credits. The big losers included VW, BYD, and Mitsubishi. BYD has been the Top EV manufacturer for 2015 and 2016 globally and was at the number three position for most EVs sold since the start of the decade. Competition from the likes of BAIC and SAIC is the main reason for the companies bad performance. Up til 2016, BYD had the advantage of being first to market, but some new models that can compete on performance and quality with BYD entered the market since 2016. (This sentence could very well be used for Tesla in a couple of years). Mitsubishi fell a staggering ten places as the company has not updated its popular Outlander PHEV or introduced new models as a replacement.

The Top 10 EV models are still lead by the Nissan Leaf, a phenomenal performance by the 7-year-old EV. The Toyota Prius replaced the Tesla Model S in the top two while the Tesla Model X performed the best of the 2016 Top 10 cohort. Newcomers Chevrolet Bolt, BAIC E-180, and the Toyota Prius replaced the BYD e6, BYD Tang and Mitsubishi Outlander in the Top 10 EV models list for Q1.

Please use the comment section below to share your thoughts on the EV market.

 

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Note on data: The detailed data above does not include the UK, who keeps their EV data more secret than Donald Trump does classified information.

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Be warned Big Auto, the China EV strategy is to dominate!

Be warned Big Auto, the China EV strategy is to dominate!

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The Chinese Government released its long-term development plan for the automotive sector on the 25th of April 2017, setting out the China EV strategy. The plan, presented by the Ministries of Science and Technology and Ministry of Industry and Information Technology in conjunction with National Development and Reform Commission, sets out how the country will ramp up the local EV sector and dominate the world market.

If successful the Chinese auto sector can leapfrog the dominance of the big auto companies, such as Toyota, VWBMW, Daimler, Ford, and GM. Big Auto has missed the boat on electric vehicles and therefore continue to downplay the technology as only a niche sector. Management boards of big auto companies are flip-flopping strategy as they try and come to grips with how to enter the market and to what extent they should invest in research in technology. BMW last week announced that EVs constituted 3% of its total sales for the first quarter of 2017 after a jump in EV sales of 50% (Top 5 EV News Week 18). With the release of the data, the company set out how it will introduce more models. The news from BMW is in stark contrast from news only six months earlier when the Board grappled with if it should pursue EVs at all (Top 5 EV News Week 49 USA-Top-10-BEV-All-time wattev2buy2016). In the USA we have recently seen how newcomer Tesla is valued above Ford and GM by investors. The response by Big Auto and other detractors of EVs was that this is a temporary phenomenon, arguing that Tesla hardly produces one tenth of the vehicles any of the top brands does. If one look at total sales of Battery Electric Vehicles (BEVs), it seems investors on the other hand value companies on their future ability to produce electric vehicles. If the same apply for Chinese brands, we can very quickly expect a Chinese brand to ascend the list of top auto brands.

 

According to the plan by the Chinese Government, it set a short-term target of EV sales of 2 million units locally by 2020 and at the same time elevate Chinese auto brands to be seen amongst the top ten electric vehicle brands globally. The medium term target is that EVs contribute 20% of the total annual fleet by 2025, which is a huge amount of cars. Measuring the movement in sales by brand in the table below we can already see the top Chinese EV brands, BAIC, SAIC, Geely Zhidou and JMC moving higher and two brands, BAIC and BYD in the top ten list for the first quarter 2017. Other evidence of Chinese companies investing heavily in the sector includes Chinese IT company, Tencent acquiring a significant stake in Tesla, sparking a rally in the stock.

china ev strategy

Measures by the Chinese Government to achieve the targets above include:

  • Financial and tax support for New Energy Vehicle (NEV) companies;
  • Making it easier for foreign companies to enter the Chinese market by improving foreign investment regulations and liberalizing the existing cap on foreign ownership stakes in joint venture enterprises;
  • Promoting R&D through incentives;
  • Subsidies to consumers through tax benefits;
  • The Chinese Government is further considering incentives for parts and components manufacturers, smart and connected cars and other fields that will help Chinese companies lead the future auto sector;
  • The Export-Import Bank of China will assist Chinese NEV companies to go global.

China already has experience of setting itself to dominate a sector and achieving set goals. Less than a decade ago the Chinese Government plotted to dominate the PV panel market and in the process brought down the price of energy production from renewables, killing some western PV manufacturers in coal plants in the process. Already we are seeing a deluge of battery cell plants being planned by the end of the decade in China. We can, therefore, expect the same domino effect as in the energy markets, taking out auto manufacturers that were slow to embrace electric vehicles.

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Q1 EV Sales China: Rise 30% year-on-year, but is it enough?

Q1 EV Sales China: Rise 30% year-on-year, but is it enough?

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Q1 EV Sales China: Rise 30% year-on-year, but is it enough?

China, the world’s largest market for electric vehicles showed a rise in sales for the first quarter of 2017, improving on 2016 figures by 12,500 units. While March was a particularly good month, selling over 30,000 units, we wonder if the total sales of nearly 56,000 units in the first quarter will be enough for 2017 to beat the record of 350,000 set in 2016?

See our analysis of H1 2017 EV Sales in China for a more up to date take on the Chinese EV market

EV sales for 2017 kicked off rather poorly in January with a disappointingly low 7,000 units. The Chinese holiday season and the regulatory clampdown on the abuse of EV subsidies were blamed for the lackluster sales. Fortunately, sales improved as the following months saw a doubling each month on the previous, setting a very promising trend. Battery Electric Vehicles outsold Plug-In Hybrids by nearly five to one as over 44,000 BEV units were sold compared to only 9,000 PHEV models during the period.

New models were the top sellers, taking three of the top five positions in a country starved for cool looking EVs. Chinese consumers are used to being dished up a mix of inferior cars due to major international brands being forced to partner with local manufacturers. To protect their IP, the global brands produced older variants of their vehicles for the Chinese market. The situation has improved for the Chinese consumer as local producers such as BAIC, SAIC and BYD have started producing improved second generation EV models. The BAIC E180 and BAIC E260, taking the first and third positions for the quarter is a case in point of how the second generation electric vehicles are drawing more buyers to the sector.

2016’s darling, BYD is slipping in the rankings, the company, part-owned by Warren Buffet, which has been the best-selling electric vehicle brand in the world for 2015 and 2016 could only muster two-thirds of BAICs sales. More worrying for BYD is that it had five models in the market compared to BAICs three BEVs. Tesla had a respectable performance with the Model X selling 1,500 units, which is 13% of all Tesla Model X units sold internationally during Q1, accounting for 6% of the company’s total sales for the period.

In total Q1 2017 sales improved 30% on that of the same period in 2016, indicating that 2017 could even be a better year for electric vehicles, despite stricter regulation, proving that electric vehicles are entering the mainstream.

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Top 10 Electric Vehicle Brands: Dedication and focus win!

Top 10 Electric Vehicle Brands: Dedication and focus win!

Analyzing the Top 10 Electric Vehicle Brands

Electric vehicle sales have breached the 2 million unit mark internationally in 2016, and most automakers have committed to an electric vehicle strategy, some more aggressive than others and in the minority of cases not having a strategy is also seen to be a strategy. The Top 10 Electric Vehicle Brands constitutes a good proxy to evaluate trends within the market and to determine the reason for a brand’s success or failure. Also, as we reach the halfway mark to the point where electric vehicles are expected to reach between 9% and 11% of the total vehicle fleet by 2025, a look into the Top 10 will provide guidance on the expected winners and losers as the disruptive nature of the technology takes effect.

 

Top 10 Electric Vehicle Brands as a percentage of the total market

Top 10 electric vehicle brands wattev2buyTop 10 electric vehicle brands wattev2buy

Sales of the Top 10 Electric Vehicle Brands constitute 65% of all electric vehicle (EV’s) sales, and for the Top 10 BEV list, 85% of all pure electric or Battery Electric Vehicles (BEV’s) are from the Top 10 Brands in the segment. However, the trend on both lists is on the decline as more and more brands participate in the market. The Top 10 Brands in the pure electric space owns a bigger percentage of the market segment as BEV’s requires more specialization and greater risk. Due to the high cost of battery technology and range anxiety, most automakers excluded themselves from the pure electric segment, providing a golden opportunity for a few dedicated brands to seize the opportunity and leapfrog their competitors into the coming decade.

 

 Top 10 Plug-In Electric Vehicle Brands

Top 10 EV Brands

The following interesting point emerges when comparing the Top 10 Electric Vehicle Brands positions in 2012 with the overall standings and the latest standings in 2016:

  • Chevrolet’s annual sales in 2016 are only marginally higher (1.7% CAGR) than it’s sales back in 2012, while the automaker nearly lost its position on the Top 10 list, regaining some stature in 2016 through a nearly doubling of its Chevrolet Volt sales.
  • Nissan remained successful with its only passenger model, the Nissan Leaf while sales of the commercial van, the  e-NV200 only amounts to around 8,500 units internationally. Having only one model over the period, however, cost the automaker its overall top spot to Tesla and BYD who had two models or more with multiple configurations.
  • Tesla’s overall position is significant, especially if one take into consideration the price point of its models compared to its competitors on the Top 10 list.
  • The rise of Tesla and BYD, being of the few companies which only focus on electric vehicles, goes to show the advantage dedicated and focussed EV manufacturers have over those that are tied to combustion vehicles. Both these companies are now busy with second and third generation products going into the third decade of the century, at a time when most competitors will only bring their first pure electric models to market.
  • Toyota has been the disappointment on the list, giving up the first-mover advantage it had with the Toyota Prius. Toyota is one of the automakers who’s strategy veered away from electric vehicles to Fuel Cell Vehicles. The company discontinued its Prius model in 2015 and brought it back in 2017, with hardly any significant increase in battery performance.
  • BMW’s strategy to early on bring Plug-in Hybrid versions off most of its models has helped the company climb in the rankings. Most of the sales of the German automaker can be attributed to the BMW i3 and BMW i3REx of which the company sold around 70,000 units internationally.
  • Ford is the other disappointing manufacturer, with the company completely disappearing off the list, even with two PHEV models and one BEV in its stable. The biggest reason for Ford’s disappointing performance is its lack of international sales outside of the USA and Canada.
  • Renault also lost in the rankings despite having various models due to limited international sales.
  • The Chinese dominance is evident from the number of Chinese-based auto manufacturers entering the list in 2016, with top performer BYD claiming the top spot in 2015 and 2016, taking the company to an overall third position. BYD’s success also proves Warren Buffets mastery, as the world’s second richest man invested in BYD back in 2008.
  • Note – The 2017 data is skewed with underperforming Chinese sales in January due to the Chinese New Year and the Chinese government clamping down on subsidy fraud. The 2017 data is further skewed with the inclusion of USA, Swedish, Norwegian and Dutch sales for February and only some countries January data being available at the time of going to press.

 

Top 10 Battery Electric Vehicle Brands

Top 10 BEV Brands wattEV2buy

Looking at the Top 10 Electric Vehicle Brands list when one only include Battery Electric Vehicles an entirely different picture emerges in many respects:

  • Most of the traditional “Big Auto” brands are missing from the list.
  • Chinese manufacturers, BYD, BAIC, Zotye, Chery, Kandi, JMC, and JAC, comprise six out of the Top 10 overall positions and seven of the Top 10 in 2016.
  • The Top 3 BEV manufacturers in 2016 correspond to the Top 3 overall for all EV’s sold in the previous table, confirming the importance of focussing on BEV’s.
  • VW has committed to a strategy shift towards electric vehicles, but it is evident judging from the 2016 data that the company needs to make hay not to fall short.

 

Electric Vehicles are entering the growth market phase in some countries

With EV sales rapidly climbing in 2016 and countries such as Norway now reaching EV sales of over 30% of new vehicles, owning an EV is not just an environmental requirement anymore drawing early adopters. Owning an EV’s has become cool and entering the growth phase in markets such as Norway and The Netherlands, where a couple of “Big Auto” manufacturers have opted to target the mainstream market through bringing Plug-In Hybrid versions of existing models. Many of the “Big Auto” brands are play stalling tactics by calling for the easing of emission standards or blocking Tesla’s direct sales model. Meanwhile, they are falling further and further behind in a market that is becoming ever more popular. Most of these manufacturers might be of the early movers top 10 electric vehiclesopinion to follow a wait and see approach, hoping that the first mover’s trips and falls due to the high risk and cost, with the intention to swoop in later with their big budgets to poach talent and ideas.  We will analyze the tussle between Battery Electric Vehicles and Plug-in Hybrid Electric Vehicles in a follow-up post.

 

 

 

 

Picture Ellon Musk: The New Yorker

Disruption draws world’s richest to the auto sector

Disruption draws world’s richest to the auto sector

The barriers to entry into auto manufacturing became ever higher over the last 100 years before the disruption caused by technological advances in electric vehicles and self-driving technology. Most of the auto brands that were around at the turn of the century have been around for 50 years or longer; the only newcomers was a spate of Chinese brands backed by the government. For an individual to reach the top 50 position on the Forbes list from vehicle manufacturing was only possible if your parents left you a trust fund with a bunch of 100-year-old stock in a big brand. In fact, the only Forbes Top 50 billionaire from the auto sector was the German’s, Herbert and Johanna Quandt who owned nearly 50% of BMW and Georg Schaeffler (Number 39 on Forbes 2016 list) who inherited the automotive parts company, Schaeffler Group. After their passing of Johanna Quandt, the children, Susanne Klatten (Number 38) and her brother Stefan Quandt (Number 48), became the beneficiaries. Mrs. Klatten invested her fortune in pharmaceuticals, helping her to gain over her brother.

Come to the turn of the century and along came Elon Musk, risking it all on a technology that has been shunned for 100 years by big auto. Being a start-up in a market controlled by a couple of dinosaurs was not easy at first, Mr. Musk had to back himself in the first couple of rounds of fundraising for the electric vehicle company, Tesla. The table below shows that Elon Musk pretty much up until late 2008 lead fundraising and loan rounds. The risk paid off as Elon Musk became by far the richest person in the US auto sector and at the time of going to press Elon Musk jumped to the 83rd position, up from 94 in the official 2016 Forbes list of the world’s richest people.

[supsystic-tables id=105]

Other early billionaires in the technology include the savvy investor Warren Buffet and Vincent Bollore. Warren Buffet, the world’s 3rd richest individual through his Berkshire Hathaway, controlled company, Mid-American Energy Holdings in 2008 bought 10% in BYD, a Chinese battery company, now the world’s largest electric vehicle manufacturer. The Investment at the time was $230m. Berkshire Hathaway is also a significant minority shareholder in GM.

Vincent Bollore, France’s 10th-richest person with an estimated personal fortune of $6 billion dollars, started manufacturing batteries in his company Bollore Blue Solutions. The firm, situated in Brittany province, who’s batteries are cheaper than lithium-ion cells used in other electric cars, allows it to hold down the cost of his small vehicles.

Suddenly investing in electric vehicles became sexy. Chinese billionaires, mostly from the technology sector, were the first to climb into the auto sector, some more successful than others. The Chinese electric vehicle boom is fuelled by government incentives targeting that 8% of all new vehicles should be EV’s by 2018.

The tech billionaire and founder of BitAuto, an online vehicle sales platform, William Li started the Shanghai-based NextEV.  The company raised $500M of an expected $1Bln already, sporting shareholders such as Tencent, who is also invested in Future Mobility, Hillhouse Capital, who also invested in UBER,  Sequoia Capital and Joy Capital. The company invested C¥3Bln in Nanjing High-Performance Motor Plant to produce 280,000 electric vehicles per year. NextEv also signed a partnership with one of the largest Chinese auto companies, JAC Auto which will see them share technology, manufacturing, supply chain, marketing, and capital.

Tencent mentioned above is owned by the world’s 46th richest person, Ma Huateng of China, also know as Pony Ma. Tencent, which applications include the popular WeChat app, aims to leverage its tech experience in a world where connectivity and the Internet of Vehicles will drive the auto industry. The development of electric vehicle technology provides a perfect platform for tech and vehicles to meet. To this end, Tencent created a company Future Mobility and targeted an autonomous vehicle by 2020.

The Chinese billionaire, Jia Yueting, founder of LeEco which owns LeTV, the Netflix of China invested in two electric vehicle companies, LeEco, which developed the acclaimed LeSee concept vehicle and Faraday Future, developer of the disastrous FF91, unveiled at the 2017 CES. Both businesses are known for making bold statements and big ticket announcements just to be followed by press reports of cash flow and funding problems.

The Chinese internet giant, Alibaba, owned and founded by Jack Ma who is 33rd on the 2016 Forbes list, invested $160M in a fund where it partnered with SAIC, one of the largest Auto manufacturers in the China to develop internet connected cars. The first car to come from the partnership is the Roewe OS RX5, where OS stand for Operating System and using SAIC’s luxury brand Roewe as a platform. The software runs on Alibaba’s YunOS operating system. Jack Ma unveiled the car in July 2016. The Alibaba Connected Car will have its own Internet ID, not needing WiFi or GPS services, enabling it to connect and identify drivers wattev2buy alibaba os rx5 internet carthrough their smartphones and wearables. The RX5 has four cameras providing it 360° vision and is voice controlled. The vehicle’s starting price is around $15,000 or C¥100,000.

Alibaba beat other carmakers and tech companies to the finish line with the 2016 release of the RX5. In 2015 Toyota invested $1 billion in artificial intelligence research, while Apple invested $1 billion in Chinese ride-hailing app, Didi Chixing. BMW went into partnership with technology firms Mobileye and Intel, providing the automaker with operating systems and driving assistance software while Kia and Google partnered around the search engine’s Android Auto operating system.

Robin Li, number 90 on Forbes List and owner of Chinese search engine Baidu, partnered with chipmaker Nvidia in September 2016 to develop a computing platform for self-driving cars. Baidu recently received approval from the Californian Department of Motor Vehicles to test autonomous vehicles, in Googles back yard. Baidu also partnered with BMW on creating an autonomous car.

Now that the floodgates are open, billionaires from around the world are looking to enter the electric vehicle and self-driving sectors. The world’s fourth richest man, Carlos Slim of Mexico, announced this early this year that he would back the development of a Mexican-produced electric vehicle through his company, Giant Motors in a joint venture with Grupo Bimbo, the world’s largest bread maker. The strategy plays off in an environment where many US based automakers are contemplating bringing production back to the USA amidst President Trumps America First policy environment. Mr. Slim said the electric vehicle would be designed specifically for Mexican conditions.

Bloomberg reported that the JSW Group’s owner and Chairman and India’s 19th richest man, Sajjan Jindal, announced in Davos, Switzerland his intention to enter the Indian Electric Vehicle market by 2020. The metals tycoon expects the Indian government, like many other governments, will promote EVs once it’s more affordable. 

It is clear that some of these businessmen are purely opportunistic, targeting to profit from regulation and subsidies for the promotion of electric vehicles.The majority, however, leverages their passions to bring better and more advanced options to the consumer at a much faster pace than what big auto ever moved in the last 50 years.

Although not mutually inclusive to electric vehicles, self-driving cars, deployable on combustion vehicles also, will drive the second phase of disruption in the auto sector over the next ten years. Self-driving car’s poster child is Google, owned by the 12th and 13th richest individuals in the world, Larry Page, and Sergey Brin. The company started testing it’s quirky autonomous vehicle as far back as 2009. Google recently spun the project into a standalone brand, named Waymo, meaning “a new way forward.” The company aims to partner with vehicle manufacturers instead of developing its own car. The first of such efforts was the conversion of 100 Chrysler Pacifica’s Plug-in Hybrid vehicles. Google, in many’s eyes, has lost the lead to Tesla, who’s progression was much faster and already has active Level 2 autonomy available in its production vehicles.

It will be interesting to compare the Forbes list of wealthy individuals ten years from now to one at the start of the century; we expect much more fresh faces who made their money from disrupting the auto sector. As a footnote, the lesson learned time and time again by dinosaurs in an industry are that they become too big, arrogant and slow, creating opportunities for new hungry entrants.

Picture: Source www.technewstoday.com