Published on December 21st, 2019 | by Jose Pontes0
“Model 3 & The Disciples” — China EV Sales Report
December 21st, 2019 by Jose Pontes
When you find yourself in times of trouble, Model 3 comes to thee
Speaking words of wisdom, let it be.
And in this hour of darkness, it is standing right in front of thee
Speaking words of wisdom, let it be.
The Chinese plug-in market is enduring heavy losses. In November, it plunged 42% year over year (YoY), to 83,000 units, with both powertrain technologies crashing as the market adjusts to a new, less subsidy-dependent reality. Although, fully electrics (BEVs) did fare a little bit better (only -36%) than plug-in hybrids (PHEVs).
In the midst of this adverse environment, October’s plug-in electric vehicle (PEV) share was just 4% (3.5% BEV), dropping the 2019 PEV market share to 5.4% (4.3% for BEVs alone), which is still above the 2018 result (4.2%) but is significantly lower than the 6.3% peak of June.
With the subsidy changes in the summer, when “new energy vehicle” (NEV) subsidies were cut off completely for vehicles with less than 250 km (155 mi) electric range and subsidies were halved for those with higher range, the effects of these changes will continue to be felt for a few more months, possibly up until next summer.
While many models saw their sales dry up, or be significantly impacted, with smaller, cheaper models unable to compensate the subsidy loss, the most expensive end of the market continues to thrive, helping foreign OEMs to increase market share. Foreign automakers are now at 15% PEV market share, and even within small EVs, there were winners, as in the case of the SAIC Baojun E-Series, which saw its sales jump after the subsidies ended. It was the only model of the A00 category (Smart-like, 2-seat EVs) to keep access to subsidies, even winning last month’s best seller title.
In November, besides the Baojun E-Series win, the highlights were the 5th position of the SAIC MG ZS EV crossover, a model that Shanghai Auto has high hopes for. SAIC hopes it will be the first Chinese plug-in model to sell in significant volumes in overseas markets. So, the fact that the MG crossover is making itself noted at home bodes well for its success elsewhere.
The Tesla Model 3 and its disciples (GAC Aion S and Geely Geometry A) are coming to the rescue of the Chinese market, with these 3 models already representing 16% of the total market last month, thanks to all three models scoring record results. These new-generation EVs are showing the market the way forward in order to resume the country’s PEV growth path.
Interestingly, 4 of the 7 top sellers in November were models launched this year, which says a lot about the fast evolution of the Chinese market.
Here are last month’s top 5 best selling models:
#1 – Baojun E-Series: With the end of subsidies for most of the small city EVs unable to reach the minimum 250 km range, the Baojun E-Series won the lottery. The Shanghai Auto and General Motors offspring watched its sales jump in the past few months, winning consecutive podium positions, and in November it even managed to beat the BAIC EU-Series and become the market’s best seller, having registered a record 9,809 units in November. The access to the current subsidy, added to its competitive price before subsidies (CNY 93,900 / $14,700) makes it an appealing model for carsharing companies, as well as other kinds of fleets.
#2 – BAIC EU-Series: The electric sedan this time was relegated to the runner-up spot, with the 6,258 units of November being its worst result since April. Is the Beijing Auto model losing charge? Despite an attractive design and specs (215 hp, 416 km / 260 mi NEDC, $32,500), the Beijing Auto model is starting to look dated, especially next to newcomers like the the EVangelist Tesla Model 3 and the Californian’s Chinese disciples, the GAC Aion S and Geely Geometry A.
#3 – GAC Aion S: Things look great for the Aion S, because the sleek sedan continues to improve its performance every passing month, having scored yet another record, 5,538 units, reaching the 3rd place in November. This is its 5th top 5 showing in a row. And if we add the 865 units of the badge-engineered Toyota iA5 EV, which is nothing else than a Aion S with a Toyota badge, the GAC sedan would have registered 6,403 units, which is higher than the 2nd placed BAIC EU-Series. … 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. That’s before subsidies.
#4 – Tesla Model 3: The success of the Tesla sedan in China is starting to materialize. In November, the sports sedan scored a record 4,658 units, allowing it another top 5 presence. With Tesla Gigafactory 3 ramping up, one can imagine the Californian will become a familiar face next year in this top 5 ranking. With the Tesla having “Diana Ross” levels of customer attraction, who knows how high it can go. …
#5 – SAIC MG ZS EV: Production of this compact crossover has been steadily ramping up, and last month it reached a record 3,687 registrations. That gave the model its first monthly top 5 spot. While the MG model has middle-of-the-road specs (45 kWh battery, 262 km / 163 mi WLTP range, 110 kW motor), it compensates with a spacious and well appointed interior. Even while Shanghai Auto is betting heavily on its electric crossover finally getting a foothold in foreign markets, the ZS EV will also have to succeed in its domestic market in order to gain scale and profitability. Will they make it?
The market is now adapting to the new incentive reality, with many former best sellers witnessing only symbolic sales while a new generation of EVs is rising.
We’ll start with the position changes. The Geely Emgrand EV climbed into 6th place, while both the Great Wall Ora R1 and BMW 530Le surpassed the Roewe Ei5 to reach the 9th and 10th positions, respectively.
But the Climber of the Month was once again the GAC Aion S, jumping two positions, to #12, with both the GAC and another of The Supremes element, the Model 3, now aiming for a top 10 position this year. That would be a great starting point for a top 5 (or even podium?) spot in 2020.
The other member of the “Model 3 & the Disciples” band, the Geely Geometry A, finally pulled off a decent performance, thanks to a record 2,465 registrations, allowing it to be #7 in November. This was the first time the streamlined sedan was the best seller among its Geely stable mates. Is Geely’s Cinderella finally starting to blossom?
There are other new players taking the opportunity to disrupt the market as well, like the MG ZS EV, 5th in November, with 3,687 units. With a little bit of luck, it could still join the 2019 top 20 ranking next month.
Outside the top 20, a mention is also due to the ramp-up of the Renault K-ZE, aka Kwid EV, now at 1,382 units. This is in only its 3rd month on the market. Also, among the landing models, we have two models already scoring 500-plus performances, with the Audi Q2L e-Tron registering 785 units while GAC sold 865 Aion S to Toyota to be rebadged as the iA5 EV. Why? EV quotas. With the Corolla/Levin PHEV twins not really setting the market on fire (500 units each in November), Toyota has to resort to this subterfuge in order to win NEV credits. So, the Aion S is a piggy-bank for GAC in two ways, not only is it a popular EV by itself, but it is also an easy one to sell to carmakers in need of NEV credits. I wouldn’t be surprised to see Aion S rebadges for Honda, Fiat, Mitsubishi, insert name in a few months.
Looking at the manufacturers ranking, BYD (17%, down 1 point) is losing momentum, while below it, BAIC (13%, up 1 point) is getting closer to the top. The #3 SAIC (11%, up 1 point) is benefitting from the Baojun E-Series and MG ZS EV and thus gaining share.
Outside the podium, Geely (5%) is hanging on, but it has to keep a close eye on Great Wall and GAC, both with 4% share, in order to keep the 4th position until the end.
Cool New Kids on the Block
This month we had plenty of arrivals, with the most important being the start of local manufacturing of the Mercedes-Benz EQC (160 units), a model that could reach some 1,000–2,000 units/month … if Mercedes is willing to get behind it, something that is not yet a given. We also have two badge-engineered models landing, the Toyota iA5 (GAC Aion S rebadge) and the Venucia e30 (Renault K-ZE rebadge). These are both twins of models made to be best sellers, so if they manage to get 20% of sales of their donor models (around 2,000 units/month) by spring time, I guess both brands would be happy. But the highlight of this month is a German model:
Audi Q2L e-Tron — With Volkswagen already on the field with a bunch of plug-ins (e-Bora, e-Lavida, e-Golf, Passat PHEV, Tiguan PHEV…), it’s now up to Audi to start ramping up its electrification volumes, and what kind of model would do it better than a compact crossover EV? Hence the Q2L e-Tron. All the design, luxury and quality of an Audi running on electrons, with a price that won’t dig a (big) hole in your wallet. (It’s 227,000 RMB / $32,400 after subsidies). If only the electric part of the SUV was as good as the rest, eh? With a 40 kWh battery (the VW Golf platform does show its limits here), 265 km NEDC range, and a 100 kW electric motor, one expected better specs from a brand that prides itself on being “vorsprung durch technik.” I mean, the much cheaper MG ZS EV has better specs! Regardless, you still get the badge and some nice interiors, so I wouldn’t be surprised to see it become a popular choice, like the preliminary 785 units in the landing month allow us to guess. Reaching some 3,000–4,000 units/month shouldn’t be a stretch, keeping Audi happy at least until the wave of MEB-based EVs finally lands.
If you like seeing the sales charts with “Others” included, here you go: