New Energy Vehicle Sales Booming in September
In September, the new energy vehicle market reached a sales peak.
According to statistics from the China Passenger Car Association, the wholesale volume of new energy vehicles in September reached 355,000 vehicles, a year-on-year increase of 184.4%, with a cumulative wholesale volume of 2.023 million, a year-on-year increase of 218.9%. Among them, BYD’s wholesale volume exceeded 70,000 vehicles, Tesla exceeded 50,000 vehicles, and SAIC-GM-Wuling exceeded 30,000 vehicles, all hitting new highs.
At the same time, various car companies are preparing for the year-end sales sprint in the fourth quarter. In September, 21 new models were launched, mainly pure electric, with 19 models, and only 2 plug-in hybrid models. Among all the new models launched, there were 15 models with revised or upgraded versions, and only 6 completely new models.
Among the pure new cars launched in September, the new cars of two new car-making forces, XPeng P5 and Leapmotor C11, were the most anticipated. Interestingly, these two car companies are in the first and second tiers of new car-making forces. In September, XPeng Motors broke through the 10,000-vehicle monthly sales volume mark.
In terms of new car information, in September, the Ministry of Industry and Information Technology released four important documents related to the development of the new energy vehicle industry: the 348th batch of “Road motor vehicle production enterprises and products”, the 9th batch of “Recommended models for the promotion and application of new energy vehicles” in 2021, the 31st batch of “Recommended models for energy-saving and new energy vehicle models eligible for vehicle and vessel tax reduction and exemption”, and the 47th batch of “Catalog of new energy vehicles exempted from vehicle purchase tax”.
Among them, a total of 52 new new energy passenger cars were logged in the recommended model catalog for the promotion and application of new energy vehicles in September, of which 46 models met the technical standards for receiving subsidies and the remaining 6 models did not meet the standards.
According to the information in the catalog of new energy vehicle models exempted from the purchase tax, the new long-range model of Tesla Model 3 declared is worth paying attention to.
New Energy Vehicle Sales Soar
In September, although the overall auto market was weak, the new energy vehicle market continued to soar, with a monthly wholesale volume exceeding 35.5%, and the market share of new energy vehicles in September exceeded 20%, reaching 21.1%, a historic high.
According to statistics from the China Passenger Car Association, the market share of new energy vehicles from January to September this year reached 12.6%, greatly exceeding the same period last year’s 5.8%.
In terms of car companies, BYD and Tesla achieved monthly sales volume records, exceeding 70,000 and 50,000 vehicles, respectively.
From the sales situation, BYD has seen explosive growth in sales for several consecutive months, with a monthly increase of up to 10,000 units. If the trend continues, BYD will achieve a breakthrough of 100,000 monthly sales in December.
In September, Tesla’s sales exceeded 50,000 units, setting a new record for monthly sales and surpassing SAIC-GM-Wuling to become the monthly sales champion of pure electric vehicles. Currently, Tesla’s global production capacity is limited, and the production capacity of Tesla in Shanghai mainly supplies the global market for export in the first two months of each quarter. In the last month of each quarter, it mainly meets the demand in the Chinese market.
SAIC-GM-Wuling’s performance this month remains stable, with a wholesale volume of 38,800 units. The new 300 km endurance Hongguang MINI EV has completed the certification process with the Ministry of Industry and Information Technology before going on the market and has reached the pre-listing stage. After the new model hits the market, sales may further improve.
From January to September, BYD, SAIC-GM-Wuling, and Tesla have firmly held the top three positions in the sales of new energy vehicles. However, there is still potential for changes in the ranks within the top three. In September, BYD surpassed SAIC-GM-Wuling to temporarily rank first in the annual sales list. As Tesla is currently restricted by the global production gap, resulting in insufficient supply in the Chinese market, it is worth paying attention to whether Tesla will abandon the global market and focus on competing for the position of pure electric vehicle sales champion in the Chinese market over the next three months.
Among new energy vehicle start-ups, NIO and Xpeng both achieved record sales in September, exceeding 10,000 units. Due to chip supply restrictions, Ideal Automotive failed to achieve a breakthrough in September sales. Second-tier new energy vehicle start-ups have also seen growth this month, with Hozon Auto surpassing Ideal Automotive to become the third-largest-selling new energy vehicle start-up.
Volkswagen’s pure electric vehicle brand, ID, achieved over 10,000 monthly sales in September, becoming the first joint venture brand to achieve such sales.
Car companies frequently launch new cars to boost annual sales
September is a peak season for car sales, and various car companies have released new models with improved specifications to meet changing market demands.
In the redesigned new cars, most of the models are annual redesign and additional configuration models without price increases. Among them, popular models on the market such as XPeng P7 and BYD Han EV have launched higher configuration or longer range models, but the prices of the models remain basically unchanged. The models with the most significant changes in the redesigned cars are the BMW iX3 and Guangzhou Automobile Aeolus Aion V Plus.
The main change of the redesign of BMW iX3 is in the appearance, following the mid-term redesign of the petrol version of BMW X3, the BMW iX3 also changes accordingly. Compared with the old models, the new BMW iX3 has reduced the use of blue trim and made some changes in the design details of the front and rear bumpers. After the redesign, the appearance of BMW iX3 is more in line with the mainstream design style of electric vehicles.
In terms of powertrain and power systems, there is no change in the new BMW iX3.
The model with the most significant change in the redesigned car is Guangzhou Automobile Aeolus Aion V Plus. After adding the Plus tail label, Aion V’s appearance, interior, power system, power electronics system, and intelligent configuration have been strengthened in all directions.
In terms of power, the motor power of AION V Plus has been upgraded to 200 kW, and the maximum range is up to 700 kilometers, and it has launched a model that supports 3C fast charging. In terms of intelligence, AION V Plus has been upgraded to the AiDiGO 3.0 system and started to support NDA navigation assist function. The upgrade of the appearance changes AION V’s mecha style, and visually it is more rounded and in line with the aesthetic needs of consumers nowadays.
In terms of new cars, XPeng P5, which has attracted much attention, was launched in September.
XPeng P5 is the first domestically-produced vehicle equipped with a lidar, and coupled with the brand reputation accumulated by XPeng Motors in the field of intelligentization, consumers have high expectations for the intelligent assisted driving ability of XPeng P5.
In terms of vehicle configuration, XPeng P5 has a total of three models with a range of 460, 550, and 600, respectively, corresponding to the use of lithium iron phosphate battery (460) and ternary lithium battery (550, 600). In terms of intelligent configuration, XPeng P5 has three versions, G version without assisted driving configuration, E version supporting highway navigation assisted driving, and P version that will be able to support city navigation assisted driving in the future.
The P version of XPeng P5 is equipped with two lidars provided by Livox, which is a subsidiary of DJI, on both sides of the front bumper. The detection distance of this lidar can reach 150 meters, the lateral field of view is 150°, and it has a point cloud density of 144 lines, a high-angle resolution of 0.16°, and a center area refresh rate of 20Hz.According to the data released by Xpeng Motors, the order volume of Xpeng P5 exceeded 10,000 within 53 hours of its listing. It is expected that these orders will be converted into sales in the fourth quarter. Based on the sales figures in September, Xpeng Motors is expected to continue to break the sales record with a total sales volume of over 15,000 vehicles in December.
In terms of new car releases in September, BYD Song Plus DM-i AWD 4WD model was released, which is the first 4WD model of the DM-i series, enhancing the competitiveness of BYD DM-i SUV models against joint venture fuel-driven cars. Currently, the price range of compact fuel-driven SUV models with 4WD capabilities from joint venture automakers is generally above RMB 230,000. The price of BYD Song Plus DM-i AWD 4WD model is controlled below RMB 200,000, which would have a significant impact on the compact fuel-driven SUV market.
In the microcar segment, SAIC-GM-Wuling NANO EV is an upgraded version of Baojun E200, mainly in terms of exterior changes. Due to the high sales of several micro electric vehicles manufactured by SAIC-GM-Wuling, automakers are competing fiercely in this market. The Changan Benben E-Star National Version, Leiting Mango, and other models are in the same segment. The competitive pressure in this market segment will continue to increase.
In October, there will be several major new car releases, including SAIC-Volkswagen’s ID.3, Geely Lynk&Co 09PHEV, Hechuang Z03, and others.
Volkswagen ID.3 is the best-selling model in Europe. With the influence of the Volkswagen brand in the Chinese market and the strong product selling points of the ID.3, the sales of Volkswagen electric vehicles are expected to continue to rise after the launch of SAIC-Volkswagen ID.3.
After the sharp increase in sales of BYD DM-i plug-in hybrid electric vehicles, the plug-in hybrid electric vehicle market, which was considered somewhat mediocre, is gradually picking up. The release of multiple plug-in hybrid electric vehicle models in October is expected to accelerate the transformation from fuel-driven cars to electric vehicles.
52 models entered the new energy vehicle promotion catalog
In September, the Ministry of Industry and Information Technology released a new batch of policy documents, including the vehicle announcement and the new energy vehicle promotion catalog. Among them, 52 models have entered the new energy vehicle promotion catalog.
In the recommended model list for the promotion and application of new energy vehicles (9th batch in 2021), 6 micro electric vehicle models were not eligible for subsidies due to a range lower than 300 km. The remaining 46 models are eligible for subsidies.## On the Catalogue of Vehicle Purchasing Tax Exemption
A total of 54 models have been included in the Catalogue of Vehicle Purchasing Tax Exemption, including a hydrogen fuel cell vehicle declared by Dongfeng Motors.
In the electric vehicle segment of the catalogue, a total of 48 pure electric cars have an average battery capacity of 48.07 kWh. Among them, the ET7 model declared by NIO has the largest battery capacity of 100 kWh, with a lithium-ion battery material and energy density at 185 Wh/kg.
What’s unique is that the ET7 model has also declared a hybrid power battery pack which uses ternary lithium and lithium iron phosphate. The battery capacity is 75 kWh, and the battery pack weighs 535 kg with an energy density of 142.1 Wh/kg. According to the information in the tax exemption catalogue, NIO will offer two options for the ET7’s power battery, with a capacity of 100 kWh and 75 kWh, both of which support battery swapping. The car’s range includes four versions, which are 550/530/675/705 kilometers. The ET7 model has completed the certification work by the Ministry of Industry and Information Technology, and NIO will officially start delivery of the ET7 once the production is confirmed.
In the tax exemption catalogue, the new long-range rear-wheel drive Model 3 from Tesla has been introduced with a 78.4 kWh ternary lithium battery pack, and its range has been increased to 675 kilometers (NEDC cycle). Taking into account the terminal market situation, there is currently a difference of over 100,000 yuan between the Tesla Model 3 Standard Range version (lithium iron phosphate battery) and the high-performance version. There is also the possibility that Tesla may reintroduce the long-range RWD (rear-wheel drive) version in the future.
As for the tax reduction and exemption on vehicles and vessels, six models have entered the catalogue in September, all sharing the common feature that their engine displacement is relatively small. Except for the Volvo XC90 PHEV equipped with a 2.0T engine, the other models have engine displacements smaller than 1.5 L, all of which are turbocharged engines.
Starting from September, various models listed in the announcements of cars, the catalogue for the promotion of new energy vehicles, the Catalogue of Vehicle Purchasing Tax Exemption, and the tax reduction and exemption on vehicles and vessels will gradually shift to the combined cycle (CLTC) and worldwide harmonized light vehicles test cycle (WLTC) for energy consumption testing. Pure electric cars will adopt CLTC cycles and plug-in hybrid electric cars will adopt WLTC. Therefore, some models that have been previously reported may have different range performances in the new declaration.
A Big Test for the Supply Chain of Auto Companies
In July this year, the overall market share of new energy vehicles exceeded 10%, and in September, it surpassed 20%. This proves that new energy vehicles have become a trend of explosive growth, and consumers’ willingness to buy has shifted from rejection to acceptance. From the market level point of view, the demand for new energy vehicles among consumers is strong.But it should be noted that the increase in market share of new energy vehicles is somewhat related to the significant reduction in production of fuel-powered vehicles due to the shortage of chips. According to Nikkei News, Japanese automakers recorded a 20-30% decline in sales in China in September. Honda’s brand, in particular, has seen sales decline for five consecutive months due to the spread of the COVID-19 outbreak in Southeast Asia, resulting in a shortage of parts supply.
Therefore, in the fourth quarter of this year, as various automakers strive to achieve their annual sales goals, their ability to manage the supply chain will become a major test and challenge to their operational abilities.
Recently, Ideal Auto announced that due to supply problems with millimeter-wave chips, consumers who were scheduled to receive delivery in October and November need to choose their own delivery plan. Option one is to receive the car on time, but with two fewer millimeter-wave radars, which will be made up for free later. Option two is to postpone the delivery.
It can be seen that, during the process of striving for annual sales in the fourth quarter of this year, automakers with strong supply chain management capabilities will have a competitive advantage. This will further enhance the advantage of leading automakers, especially for automakers such as BYD, with strong production capacity or Tesla, with strong supply chain management capabilities.
For automakers who hope to enter the top ten in annual sales of new energy vehicles, it is necessary to ensure a secure supply of parts in the next three months in order to achieve their goals.
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.