For the sixth consecutive month, the Chinese e-car market in January 2020 recorded a decline in monthly sales compared to the same period last year. This is partly due to the fact that Chinese government subsidies for New Energy Vehicles (NEVs) were reduced or completely eliminated in the second quarter of 2019. As a result, Europe was able to break away from China in the electric car market in January 2020. We look at the development.
China - electric car market declining; with a chance for improvement
January was affected by the coronavirus outbreak, which left many parts of the country in shock after the official holidays. A report from the Chinese Passenger Car Association stated that the Chinese passenger car market declined by 92 per cent in the first two weeks of February and predicted a 70 per cent drop for the month as a whole. This is likely to lead to a strong upswing in the second half of 2020 - provided that conditions remain unchanged. However, the market is expected to remain weak in the near future.
China had 30,900 registered electric cars in January 2020, which equates to a market share of 1.6 per cent. Compared with the previous year (72,200 units), this represents a decline in registrations of 57.2 per cent or 41,300 electric vehicles. It can, therefore, be stated: In China, the largest electric vehicle market, new registrations of New Energy Vehicles (NEV) fell for the first time in the year as a whole. It is therefore not surprising that, contrary to assumptions made in recent months, China will not significantly reduce its subsidies for NEVs, which include electric cars in addition to other vehicles with alternative drive systems, this year.
In 2020, local Tesla production is likely to boost the electric car market. From October 2020 VW plans to have 300,000 electric cars (rising) in China. The foundation for this has been laid. A new ID. model is already coming off the assembly line in pilot production. The only question for China is whether the forecast of one million e-cars by the end of 2020 can be maintained. The turbulent start to the current year does not make it likely.
Europe's electric car market grows by almost 90 per cent compared to last year
The European electric car year began with a growth rate of almost 90 per cent (88.5%). The forecast of more than 700,000 units this year is based on a stronger second half of the year than the first half. This is mainly due to the fact that the Volkswagen Group's MEB models will not be launched on the market until the summer. A potential rush on the VW Group's offer is currently expected. Herbert Diess, CEO of Volkswagen, only recently stated that "the ID.3 has to get on the road" - after all, it is making a decisive contribution to achieving the CO2 limits. A similar situation was observed in 2015 - KIA in Germany - when 130g/km targets were introduced.
The Volkswagen Group expects to achieve just over 200,000 electric car units in the entire EU European region (plus EFTA and Great Britain). This corresponds to more e-cars sold than the entire Western European electric car market could record in 2018. It is predicted that the level of e-cars will double in 2020 compared to 2019, reaching over 700,000 units or just over 5 per cent of the total passenger car market.
USA: Tesla Model Y should already be the winner in 2020
It is known that the Tesla Model Y production seems to start 6 months earlier than planned, deliveries in the first quarter were already mentioned. The Model Y has been in production since the beginning of the year and is scheduled for delivery to the first customers at the end of the first quarter. However, production of the Model Y in Shanghai is not scheduled to start until 2021. The Tesla Model Y could be a defining feature of the American market in particular.
This is because automotive analysts assume that the launch of the Tesla Model Y will probably support the market in the second half of the year, while other car manufacturers will probably ignore the US market and focus on meeting the Chinese and European CO2 limit targets. Deliveries are expected to be below 350,000 units. By the end of January, the company had delivered around 22,000 e-cars.
Japan's electric car market still weak in 2020
It can be said that the weak development of the Japanese electric car market is continuing, which is reflected in a further decline in the market. In January 2020, sales of electric cars fell by almost 70 per cent compared to the same period last year. In other words, only 880 units were registered instead of 2,866 units in the previous year. As a result, e-cars account for only 0.3 per cent of the total car market. It is predicted that the 2020 level will remain below 40,000 units.
Source: Matthias Schmidt - West European Electric Car Market Intelligence Monthly Report Edition 01.2020. German publication: https://www.elektroauto-news.net/2020/europa-setzt-sich-am-e-auto-markt-vor-china/ Translation and modification: Christian Pfäffli