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| This land yacht is the best selling foreigner in China |
Tesla Model
3, GAC Aion S and BMW 530Le shine in depressed market
There
seem to be no end to the end-of-incentives hangover, with the Chinese
plugin market dropping a steep 27% YoY, and PHEVs crashing 45% YoY last month,
while BEVs got finally dragged into the red ink, dropping a harsh 20% in
September, while the overall market behavior was somewhat not so catastrophic,
sliding down just 6% YoY.
In
the midst of this adverse environment, September’s PEV share was just 4%, dropping
the 2019 PEV market share to 5.7% (4.4% for BEVs alone), which is still above
the 2018 result (4.2%), but should the market continue in the red until the end
of the year, the 2019 growth rate should be minimal, compared to the
exponential rates of previous years.
The
reason for this string of drops lies on the subsidy changes that happened on June
26, when NEV subsidies were cut off completely for vehicles with less than 250
kms electric range, while those with higher range saw their subsidies halved.
From
then on, we are witnessing a less subsidy dependent market, with smaller,
cheaper models unable to compensate the subsidy loss, while the most expensive
end of the market continues to thrive, helping foreign OEMs to increase market
share, now at 13%.
Currently
China is the fastest evolving plugin market in the planet, with several new
models outselling the YTD best sellers, like the just landed BYD e2 (2,078
units), the badge engineered JAC crossover E20X (2,236 units) from SOL,
the new EV-only brand from Volkswagen, or the NIO ES6 (2,190).
In September,
the nameplates that made an impression were the #3 Tesla Model 3, the #4 GAC
Aion S and the #5 BMW 530Le, three different proposals that should start to
become regular faces in future Top 5’s.
Here’s last month Top 5 Best Selling models individual performance:
#1 – BAIC EU-Series: The electric sedan scored 8,710 units
last month, with the Beijing Auto sedan recovering the monthly Best Seller
title, while improving 15% month-on-month. The design and specs (215 hp, 416
kms / 260 mi NEDC, US $32,500) allows it to remain a popular choice, but with
the competition increasing every passing month, BAIC has a tough job ahead of
it, if it wants to keep leading the pack.
#2 – Baojun E-Series: With the end of subsidies for most of the small city
EVs, unable to reach the minimum 250 kms range, the few that still have access
to subventions have seen their sales rise, and none did it more spectacularly
than the Baojun E-Series, Shanghai Auto and General Motors offspring. The last
months of the tiny two-seater have been their best yet, having registered 5,353 units last
month. The updated range, thanks to a new 24 kWh battery, is a crucial tool to
reach the subsidy minimum range requirement, which added to its competitive
price (CNY 93,900 / USD 14,700) before subsidies, makes it an appealing model,
especially considering its modern design and features.
#3 – Tesla Model 3: The poster-child for electric mobility hasn’t yet taken
over this market by storm, like it did elsewhere. Still, the Tesla sedan is
making its own disruptive path, with the estimated 4,200 units of September
allowing it to reach a podium seat. At this point, the Tesla nameplate is far
from the domination held in North America or Europe, but with local production
set to be a few weeks away, the sporty silhouette of the Model 3 should become
a common sighting in this Top 5 soon.
#4 – GAC Aion S: A few months ago I was mentioning the big potential of this model, saying
it could reach a 10,000 units/month pace. And things are going well for the
Aion S, because the sleek sedan is now at 4,006 units on its 5th
month in the market, reaching the 4th place in September, its 3rd
Top 5 spot in a row. Another sedan inspired by the Tesla Model 3 formula, GAC
has high hopes for its new dedicated EV lineup, the Aion. Right now we have the
sedan Aion S, but a midsize SUV, the LX, will soon follow. Back at the Aion S,
beyond the stylish (and aerodynamic - 0.245cd) looks, this new model bears some
impressive specs: a 59 kWh CATL NCM 811 battery, 510 km / 318 mi NEDC range and
Level 2 driving aids, but the real killer is the price: Around 180,000 CNY /
$26,000. Before subsidies. Like Kanye West would say: “Now, I ain’t
sayin’ it’s a Tesla-killer / But the Aion is messin’ with the Best Sellers…”
#5 – BMW 530Le: The rise and rise of BMW’s luxury sedan in China demonstrates two
intersecting trends, first the never-ending increase in demand for
environmentally-friendly vehicles in China, and second the need to fulfill the
plugin quotas. Add the two together, and you have 3,486 units, a new
record result, even without access to subsidies (then again, let’s face it,
subsidies for cars at this price level don’t really make that much of a
difference, the owners just use the money for some nicer alloys or optional
creature comforts…), so the leader in the Luxury category should continue
selling at over 3,000 units per month, which is well above its direct
competitors, that are happy to reach 1,000 units in one month.
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| GAC Aion S |
2019 ranking
The
market is now adapting to the new reality, now that certain models lost access
to subsidies.
We’ll
start with the most important position changes, with the #4 BYD Tang PHEV and
the #5 Chery eQ climbing one position, at the expense of the BYD e5, that has
seen its sales dry up (221 units).
The
BYD workhorse sedan is now between a rock (subsidy cut) and a hard place
(internal competition, with the new BYD e2), so the carmaker needs to do
something, if it wants to revive its bread and butter model.
Elsewhere,
both the BMW 530Le and the Tesla Model 3 benefitted from strong deliveries last
month to jump several spots on the ranking, with the German sedan reaching #10,
while the Californian was up to #11.
Oh,
and with both nameplates separated by just 265 units, we should see a pretty
interesting race for this year title of best foreign model. Stay tuned…
Another
model profiting from the sales drought of many nameplates was the BAIC EX-Series,
that climbed to #13, while its small sibling, the EC-Series, hanged on in #18.
One
big event was the GAC Aion S reaching the Top 20, in #19, thanks to 4,006
units, its 4th consecutive personal best in only 5 months on the
market, and with 3 months still to go, it wouldn’t be surprising if it still
got time for a Top 10 spot in 2019. As for next year, it will be a strong
contender for a Top 5 position…
Elsewhere,
the SOL E20X seems to have started its regular deliveries, with 2,236 units,
while the NIO ES6 reached 2,190 units in September, allowing the brand to stay
as the Best-Selling Startup, while SAIC’s MG eZS crossover registered
1,800 units, a positive month for a model with high ambitions in export markets.
A
mention also for the estimated 1,400 units of the Tesla Model X, the best-
selling Luxury SUV last month, but with the Californian nameplate still 1,500
units behind the NIO ES8 (8,500 units) in the 2019 count, it seems a difficult
task for the Tesla nameplate to remove the NIO from this year category
leadership.
Looking
at the manufacturers ranking, BYD (19%, down 4%) is losing momentum, while
below it, BAIC (13%, up 1%) and SAIC (10%, up 1%) are benefitting from the new environment
to gain share.
Outside
the podium, Geely (6%) hangs on, watching the medal positions from a far, while
at the same time gains space over smaller players (Chery, Great Wall, JAC…),
behind it.
Will
this Natural Selection help the market become more competitive? For now,
the best foreign carmakers (Tesla, BMW and VW all have 3% each), are already
surpassing several local OEMs, with these front runners winning crucial
breathing space, in this highly competitive market.
On
the other hand, it seems in the future only some 5 or 6 Chinese EV makers will
be able to run with the best of the foreign brands…
Any
bets on who they will be?
The big news for the Chinese market will be the upcoming determination of the NEV quotas for 2021 and the following years. I have read somewhere (can't remember where) that the new targets will be announced before year end. It makes sense for the Chinese government to replace expensive carrots (subsidies) with sticks (quotas).
ReplyDeleteA non-expensive "stick" can also be applied simply by increasing taxes on polluting vehicles, instead of direct subsidies for non-polluting ones... No need to switch to an entirely different incentive approach for fiscal reasons only.
DeleteTaxes (or subsidies, i.e. negative taxes) and quotas (cap-and-trade programs) both have unique advantages and disadvantages. While taxes/subsidies will provide the best result that can be achieved at a set cost, quotas enable setting a specific goal that will have to be met no matter how much it costs... Unfortunately, in practice, goals for cap-and-trade programs are invariantly set way too low (probably due to lobbying efforts?) -- it always turns out the goals can be met easily, and the credits soon lose almost all value, making the programs entirely ineffective going forward.
And that's what we are seeing in China as well right now: the quotas for 2019 and 2020 are way too low to keep the growth of previous years.
Hey! Hope all is well. Quick note on the total summation. Looks like your total figure (76,676) doesn't include the GAC Aion S (4,006) and the Xiapeng Xpeng G3 (2,185). When i sum your figures i reach 82,867. Hope this helps!
ReplyDeleteAs per CAAM, only 80,000 PEVs (63,000 BEVs and 17,000 PHEVs) were sold last month. So neither 82,867 nor 76,676 is correct.
DeleteAnd the worldwide sales of 3 million in 2019 is very doubtful.
Anyway some year has to see a decline. But 2020 will see a different story with GF-3 cranking out more vehicles.
@JR - You were right, there's a bug in the formulas, they weren't counted. Thanks!
Delete@Anonymous - CAAM does not include imports on their data, but includes other vehicle categories (Buses, etc) that i don't, so they are not direcly connected.
Short notice of subsidy cut starting from June-26 caught many electric automakers off-guard.
ReplyDeleteThey have to order extra batteries, redesign their vehicles to accomodate the extra batteries and also retool their factories to make long range BEVs and it takes many months.
Hopefully starting from 2020, we can see the sales increasing once again.
All they need to do is reduce the steel used in frame and support it with the battery weight, this way the vehicle could weigh the same even with extra battery and every extra kg of battery could power the vehicle for more distance.
Keeping all this in mind, Chinese automakers are launching crossovers which gain extra space in trunk area and also the height factor adds to extra space.
I don't expect more than a couple thousand MIC Model 3 this year either -- but added no top of imported models, this surely should be meaningful enough to secure the "best foreign model" title?...
DeleteAs for the production ramp, I don't believe the original Model 3 issues in Nevada/Fremont to be indicative here at all. For the first several months, power trains were the major bottleneck -- but Chinese production will initially import those from Nevada: so no new issues are to be expected here at all. (Battery assembly in Shanghai from locally sourced cells will only commence some time during H1 2020.)
Also, Model 3 was an entirely new product, and on an entirely new scale for Tesla. They introduced new assembly approaches to manage this volume; and they had a lot to learn about logistics etc. at such volumes. None of these things will be new for them in Shanghai. I am confident that we will see four figures per week within a few months -- indeed the goal to get to at least 1000 a week before the end of this year seems entirely realistic to me.
Ugh... This comment didn't go where it was supposed to go. What I actually wanted to write here:
DeleteBattery weight is no replacement for body weight. Depending on the design approach, the battery casing *can* double as a body part -- but that's only the casing. The vast majority of the pack's weight (cells, modules, cooling, wiring) goes on top of that. So a vehicle with a bigger battery will *always* be heavier. (Unless of course there are unrelated weight savings elsewhere...)
Not sure though why increased weight should matter anyway?...
RFLMAO... weight kills range!
Deletewritten by Looney Tunes
Range impact from weight increase is a pretty small fraction of range increase from larger capacity.
Delete(Even less during highway driving, where range matters most.)
You know vehicle engineering a lot. How do you achieve high efficiency ratios for a set capacity and budget?
DeleteIf your answer is get a huge battery (like 150kWh), mainly use SiC on power electronics and overlook aerodinamics and vehicle mass your proposal vehicle will make Homer Simpson very happy.
When the Model S came out, they had choosen high aluminium content because they were stupid or didn't know better?
written by Looney Tunes
I didn't say weight doesn't matter. I said that the weight-related range impact of a larger battery is far far smaller than the capacity-related gain.
DeleteOf course aerodynamics do matter (especially at highway speeds); as does power train efficiency. Which are two reasons why the Model 3 is the most efficient EV at highway speeds -- even more than much lighter models with smaller batteries...
My understanding is that Model 3 production in Shanghai has actually started this week (many trucks can be seen delivering parts), and sales will start as soon as they get product approval -- which rumours say could happen within a couple of days...
ReplyDeleteEither way, if made in China Model 3 sees *any* meaningful deliveries this year, I think it's safe to say the title of "best foreign model" is pretty much guaranteed -- at least if we consider MIC Model 3 still a foreign model?...
If we would look at previous experience, it took a whole year to ramp up M3 production to the "meaningful" level... Even with experience and Chinese magic, I seriously doubt if we could see any meaningfull deliveries until q1-q2 2020...+ We know nothing about battery supply yet. There would be no in-house battery production on GF3, and LG has quite a limited production capacity and lot of customers.let's hope LG could ramp up/redirect it's cylindrical cells production faster, than its did with pouch cells
DeleteModel 3 MIC will continue to be considered a "foreign nameplate".
DeleteAs for deliveries of MIC Model 3 this year, like y.v., i do not expect them to be in large volumes, a few thousands, maybe, but not in enough volumes that would make it change the current deliveries trend.
I don't expect more than a couple thousand MIC Model 3 this year either -- but added no top of imported models, this surely should be meaningful enough to secure the "best foreign model" title?...
DeleteAs for the production ramp, I don't believe the original Model 3 issues in Nevada/Fremont to be indicative here at all. For the first several months, power trains were the major bottleneck -- but Chinese production will initially import those from Nevada: so no new issues are to be expected here at all. (Battery assembly in Shanghai from locally sourced cells will only commence some time during H1 2020.)
Also, Model 3 was an entirely new product, and on an entirely new scale for Tesla. They introduced new assembly approaches to manage this volume; and they had a lot to learn about logistics etc. at such volumes. None of these things will be new for them in Shanghai. I am confident that we will see four figures per week within a few months -- indeed the goal to get to at least 1000 a week before the end of this year seems entirely realistic to me.
During the quarter, BYD Auto lost the Qin Pro EV from the Top20 and saw the distance reduced for BAIC Motor, while Chery Automobile reached the 4th place with the NEV subsidies changes.
ReplyDeleteFrom the posted data, Q32019 standings are:
1st BYD Auto with 134261 vehicles
2nd BAIC Motor with 107303 vehicles
3rd SAIC Motor with 75955 vehicles
4th Chery Automobile with 29616 vehicles
5th Geely Auto with 27300 vehicles