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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?
