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.

Interested in finding the best electric vehicle for you? Download our fun and easy app below, set your preferred technology, price, and range 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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China halting development of new combustion plants

China halting development of new combustion plants

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China halting development of new combustion plants

Recently the Chinese Government embarked on a program to clean up the electric vehicle sector which has been negatively impacted a confluence of companies rushing to produce electric vehicles lead to subsidy fraud and sub-standard products. At some point in 2016 over 200 companies had business plans to profit from the Chinese Government’s aggressive program to establish a dominant electric vehicle sector. A large number of the business operating in the sector had no previous experience in producing cars, among them were IT and Social Media companies such as Tencent (Future Mobility and Tesla), Baidu / BitAuto (NextEV) and LeEco (Faraday Future). The Chinese authorities became concerned that the unregulated development of the sector could lead to an oversupply of vehicles as the total planned capacity from the 200 companies reached over 50 million units annually, ultimately negatively impacting the sustainability of its program. At the end of 2016, the government closed or fined various manufacturers who were caught taking advantage of the subsidies to promote the adoption of electric vehicles. Further measures to regulate the industry included:

  • creating a list of battery manufacturers that are allowed to operate and supply technology to its electric vehicle sector,
  • regulating which automakers are allowed to produce electric vehicles in China through the issue of production certificates by the National Development and Reform Commission (NDRC), and
  • setting Electric Vehicle Management and Evaluation Rules through the Chinese Automotive Technology and Research Center.

 

Other adjustments were made to entry applications in the auto sector by requiring joint ventures with foreign automakers, such as Denza, to be approved by the investment department of the State Council, local manufacturers need approval from the relative provincial government. The State Council indicated that in principal new capacity to combustion plants should be capped effectively halting development of new combustion plants.

At the time of publication, only fourteen companies have so far received production certificates for new energy vehicles, the last being Guangdong GreenWheel Electric Vehicle Co. Ltd which received approval to develop a 50,000 unit plant in Mingcheng Industrial Park. Greenwheel indicated that the plant would be developed at a cost of $267 million ( RMB 1.783b ). To successfully apply for a production certificate, the applicant needs to convince the authorities that it can research and develop key technologies such as powertrains. The other companies with development certificates are BAIC BJEV, Changjiang EV, Qiantu Motor, Chery New Energy, Jiangsu Minan, Wanxiang Group (Karma Automotive), JMC EV, Chongqing Jinkang, NEVS, Yudo Auto, Know Beans, SD EV, and Hozon Auto.

Up to now Chinese auto manufacturers provided very sketchy specifications on the electric range of their models, mostly indicating how far the vehicle can travel at a constant speed of 60km/h. To protect and assist the consumer the Chinese Automotive Technology and Research Center for the first time introduced an EV Test through the issue of the Chinese First Electric Vehicle Management and Evaluation Rules. The first classification process should be completed in the second half of 2017. The classification would be done by a five-star rating focusing on the following key performance areas:

  • Power consumption,
  • Battery life,
  • Charging,
  • Safety, and
  • Performance.

The Chinese Government aggressive EV strategy targets the sale of 800,000 electric vehicles in 2017, increasing sales to two million units per annum by 2020. The top ten automakers, including FAW, Dongfeng Fengshen, Chana, SAIC, GAC Trumpchi, and Great Wall finalized production plans to produce over 4 million units by 2020 at a planned investment of $12 billion (RMB 80 billion ).

Interested 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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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.

Interested 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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