Growth stagnates and a crisis begins? The April sales of new energy vehicles in Europe | President Zhu's column

Globally, car sales were declining in April, a trend that was a bit worse than LMC Consulting's forecast in March. Global passenger car sales fell to 75 million units per year in March with seasonally adjusted annualization, and global light vehicle sales fell 14% year-on-year in March, while April from the current release:

The U.S. decreased 18% to 1.256 million units

Japan decreased 14.4% to 300,000 units

Germany fell 21.5% to 180,000 units

France fell 22.5% to 108,000

If we estimate the situation in China, according to the estimates of the Association of Automobile Manufacturers, the retail sales target of car companies in April fell sharply year-on-year, and the retail sales of passenger cars in the narrow sense are expected to be 1.1 million units, down 31.9% year-on-year, according to this calculation, the entire global passenger car decline in April 2022 reached about 24%.

Figure 1 Overview of global passenger car sales, the automotive industry is in a weak (declining) cycle

From the perspective of the European new energy vehicle market, Germany sold 43,872 vehicles in April, down -14% year-on-year and -29% month-on-month; France sold 22,926 vehicles in April, an increase of 10% year-on-year and a month-on-month decline of 27%; the United Kingdom has not yet come out. The situation of new energy vehicles in April was basically sideways, and the growth situation was not very good.

Figure 2 Sales of new energy vehicles in Europe in 2022

Part 1: Overview of year-over-year data

From the Perspective of Europe, the main markets of Germany, France, Italy and Spain are declining, the probability of sales in the United Kingdom will also decline, and the correlation between automobile consumption and the macroeconomic environment is too large.

Figure 3 Comparing the total amount in April 2022 with the same period last year, it can be seen that automobile consumption in Europe is weakening

If the total amount is decomposed, HEV, PHEV and BEV three areas, the decline of pure electric in various countries is not particularly obvious, and PHEV due to supply reasons have declined quite large.

Figure 4 Year-on-year data by type in April 2022

In April, Germany's pure electric vehicle smiley face 22175 units (-7% year-on-year, -36% month-on-month), plug-in hybrid sales of 21697 units (-20% year-on-year, -20% month-on-month), the total penetration rate of new energy vehicles in the month was 24.3%, although up 2.2% year-on-year, but this is a very small month in Germany.

In April, the French market sold 12,692 pure electric vehicles (+32% year-on-year, -36% month-on-month), plug-in hybrid sales of 10,234 units (-9% year-on-year, -12% month-on-month); the penetration rate of new energy vehicles in the month was 21.1%, an increase of 6.3% year-on-year.

Other European markets, such as Sweden, Italy, Norway and Spain, are generally in a state of low growth.

Figure 5 Comparison of BEV and PHEV in April 2022

From the perspective of penetration rate, in addition to Norway to achieve a high penetration rate of 74.1% of pure electric vehicles, the penetration rate of pure electric vehicles in several other large markets is about 10%, and in the current economic environment, if you want to go one step further, you must take into account that the price of power batteries is also continuing to rise.

Figure 6 Penetration of BEV and PHEV

Part 2: The Problem of Supply and Demand This Year

The problem facing Europe this year is that due to the shortage of chips and the supply problem of Ukrainian wire harness companies, the lack of supply of vehicles has led to an increase in car prices; while the increase in inflation has caused the real income of the people to fall, the price of gasoline has soared, and the threat of potential unemployment caused by the increase in the operating costs of enterprises can be seen here, and it can be seen that in Germany, where the strongest economy, the decline in individual car purchases is faster than that of the Fleet fleet (fleet sales fell by 23.4%, Private purchases fell by 35.9%).

In the latest report, rising costs in the automotive industry are beginning to shift – Bosch says the increase in raw materials, semiconductors, energy and logistics costs need to be borne by customers.

‘Auto supplier giant Bosch is renegotiating contracts with automakers to increase what it charges them for supplies, a move that could mean car buyers will see yet another boost on window sticker prices during this pandemic.’

Figure 7 The price transmission mechanism of automotive industry parts to car companies has begun

Brief summary:

I think the next possibility is that the price of the car will continue to rise for a period of time, and then according to the actual situation of the product force and the sales terminal to differentiate the demand, in this process the scale effect of the automobile industry is weakening, is based on the demand to determine the scale, and the profit margin of the industrial chain will be compressed for a period of time. This is a bit like the era of the oil crisis, you need to find a company that can survive the past, this period is the clearance stage of the market elimination period.

Figure | network and related screenshots

About author:Zhu Yulong, senior electric vehicle three-electric system and automotive electronics engineer, author of "Automotive Electronics Hardware Design".

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