How will China's new energy vehicle market move in 2023? There are different voices in the industry.
Full-year forecasts from third-party agencies are relatively optimistic. The China Association of Automobile Manufacturers (CAAM) expects to sell 9 million new energy vehicles this year, a year-on-year increase of 35%; The association predicts that sales will reach 8.5 million units, with a penetration rate of 36%; Electric vehicle 100 people will expect that if optimistic, sales may reach 10 million units, a year-on-year increase of 30%-40%.
But 2023 is off to a bad start.
According to January automobile production and sales data released by the China Association of Automobile Manufacturers, sales of new energy vehicles were 408,000 units, down 49.9% month-on-month. However, it will pick up in February. According to the forecast given by the passenger car association, retail sales of passenger cars in the narrow sense in February will be 1.35 million units, of which retail sales of new energy vehicles are expected to be 400,000 units, a year-on-year increase of 46.6%, a month-on-month increase of 20.3%, and a monthly penetration rate of 29.6%.
And affected by the subsidy decline and the Spring Festival holiday, the data in March is more referenced. The final decision on the direction of China's new energy vehicle market in 2023, and whether sales can exceed 10 million units, depends on the following four variables.
01
Local governments relayed subsidies and consumption vouchers
The biggest "bearish" is considered to be the withdrawal of "national subsidies" from the historical stage, and the total amount of cumulative subsidies in 13 years is expected to reach 200 billion yuan, which has now come to an abrupt end.
The concern is that starting in 2023, only one purchase tax exemption will be retained for new energy vehicles. Will the attractiveness of new energy vehicles to consumers weaken? This, in turn, affects the sales performance throughout the year.
This concern exists, but it is not absolute. Although the state subsidy has withdrawn, the local government has begun to relay, and the new energy vehicle replacement subsidy support policy is becoming a "standard" action in various cities.
At the beginning of 2023, Shanghai, Chongqing, Beijing and other provinces and cities announced the continuation of the implementation of new energy vehicle replacement subsidies to promote automobile consumption. On February 25, Shanghai issued a notice that before June 30, 2023, individual consumers who scrap or transfer out of their passenger cars registered in Shanghai and meet relevant standards, and purchase pure electric vehicles, will be given a financial subsidy of 10,000 yuan per vehicle; Chongqing has also issued relevant measures, from March 1 to June 30, 2023, consumers who sell, transfer or scrap old passenger cars that have been registered for more than 6 months and purchase new energy passenger vehicles will be given a capital subsidy of 1,000-3,000 yuan per vehicle; On March 1, 2023, the Beijing Municipal Bureau of Commerce announced that it will further accelerate the elimination and renewal of old vehicles, and from March 1 to August 31, passenger cars registered in the city for more than one year can be scrapped or transferred out of the city's name for more than one year, and new energy passenger cars purchased can receive subsidies of 8,000 yuan or 10,000 yuan.
Changsha, Sanya and other cities have followed suit, and the support policies are similar, as long as new energy vehicles are replaced, they can get financial subsidies of less than 10,000 yuan.
In addition, some cities have adopted the issuance of consumption coupons to stimulate consumption, such as Shijiazhuang, Hebei, Yongkang and other places, which set up multiple levels according to the purchase price, corresponding to consumption coupons ranging from 3,000 yuan, 5,000 yuan and 8,000 yuan.
The two sessions in March are an important juncture.
It can be speculated that after the two sessions, more cities will come up with new energy vehicle subsidy policies. The upward effect of support measures on new energy vehicle sales is also quite obvious. Take Beijing's replacement subsidy policy last year, which boosted the retail sales of new energy vehicles by 17%.
02
Tesla Modle2 is in labor, and the price of 100,000-200,000 yuan with electric vehicles fights
Talking about the impact on domestic new energy vehicle sales, Tesla's price reduction has increasingly become an important factor.
On March 2, Tesla broke the heavy news at the investor conference that Tesla vehicle production costs will be further reduced, and the manufacturing cost of the next generation of models will be reduced by 50% on the basis of Model Y or Model S. This will put great pressure on competitors, and the entire electric vehicle market will also usher in a tsunami-like price reduction tide and promote the rapid popularization of new energy vehicles.
In fact, as early as the beginning of 2023, Tesla has already made a big move to reduce prices.
When the "national supplement" withdrew and many car companies were busy raising prices, on January 6, Tesla cut the price of models sold in China, and the price of Model 3 and Model Y hit a record low, with price reductions as high as 2-48,000 yuan. And the price reduction effect is remarkable, Tesla China won 30,000 orders in three days, and rushed to the hot search.
In addition to the price reduction of existing models, the more disruptive in 2023 should be the Model 2. On March 2, Musk unveiled an internal battery development plan, which also made it possible to launch a $25,000 self-driving electric car in 2023, alluding to the legendary Model 2. If it is produced on a new platform, the degree of integration is higher, the production cost is reduced by 37%, and the gross profit margin of the bicycle can still exceed 20%, which still reserves a certain amount of room for price reduction.
Once the model is introduced to the market, it is bound to trigger other car companies to follow suit and trigger a new round of price war.
There may be another factor that is more lethal than Tesla's price cut: the volume of new energy vehicles in the price band of 100,000-200,000 yuan.
Source: China Association of Automobile Manufacturers
The price range contributed by the main sales of traditional energy passenger vehicles is 100,000-150,000 yuan, and in 2022, this price band generated sales of 5.784 million units, accounting for 24.5% of the total passenger car sales. It was followed by the 150,000-200,000 units, with sales of 2.777 million units, accounting for 11.8%, and the two combined accounts for 36.3%.
On the other hand, new energy vehicles, sales between 150,000-200,000 have just begun to increase, and models of 10-150,000 yuan have not yet broken out.
Source: Tesla Investor Conference
The drug twister that detonated this range, Model 2 may be one, and other domestic car companies are also an important driving force, and have also begun to line up.
In the past few days, Geely has just released a new Galaxy brand, focusing on the 15-300,000 market, after the release of Galaxy, Geometry is responsible for the market below 150,000 yuan, and Extreme Krypton is responsible for the market of more than 300,000 yuan, forming a comprehensive cross coverage; Similarly, on March 1, Zerorun joined the battle group and released four new cars in one go, with extremely lethal prices and shouted the slogan of redefining the standard of 150,000-200,000 car purchases.
The mountain rain is coming. Not surprisingly, the tide of price cuts will also ignite the incremental market for new energy vehicles in second- and third-tier cities.
Whether it is a new force in car manufacturing or a traditional main engine factory, the market of 100,000-200,000 will be the biggest attraction in 2023, and it is also an important driving force to determine the sales of new energy vehicles.
03
High-power charging piles accelerate construction and mileage anxiety disappears
In 2023, the launch of high-power charging piles with a power of 120Kw-350Kw and accelerated construction will further eliminate the mileage anxiety of new energy vehicle owners, and consumers will have more sufficient reasons to choose to buy trams.
According to data released by the China Charging Alliance, in 2022, there will be 1.797 million domestic public charging piles, including 761,000 DC charging piles and 1.036 million AC charging piles. In 2022, an average of 54,000 new public charging piles will be added every month.
The highlight is that the proportion of high-power charging piles is increasing.
Source: 2022 White Paper on Charging Behavior of Electric Vehicle Users in China
According to the "2022 White Paper on Charging Behavior of Chinese Electric Vehicle Users" released by Nenglian Zhidian and China Charging Alliance, the construction of charging facilities below 30Kw accounts for 24%, and charging users account for only 2%. The proportion of 120Kw-210Kw charging facilities construction has increased to 52%, and charging users account for 65%. In addition, the proportion of ultra-high power charging piles exceeding 270Kw has also increased significantly.
In comparison, a fast charge with a power of 150Kw and a charge of 30 kWh will take 12 minutes to charge. If it is a 350Kw supercharging pile, it only takes more than 5 minutes to complete, and the charging speed is close to that of fuel vehicles. Compared with the mainstream 60Kw power fast charging in the past, it is equivalent to 3 times and nearly 6 times the increase.
Imagine, with the increase in the share of high-power charging piles in the public charging service market, especially the improvement of charging infrastructure such as highway service areas and intercity fast charging networks, the pain points such as charging queues and long charging times will be effectively solved.
04
The purchase restriction and driving restriction policy changed, and the sales of new energy vehicles took the opportunity to make up the quota
Possible changes in purchase restrictions and driving restrictions in some cities will also affect the sales of new energy vehicles.
In the past few years, the demand for new energy vehicles was mainly in megacities, and the slowdown in sales growth in the later period was a drag on the purchase restriction and restriction policy. Data show that sales of new energy passenger vehicles in megacities accounted for 23% in 2022, down 6 percentage points from 2021. Compared with large cities with non-restricted purchases, sales growth is more prominent.
Even in cities with limited purchases, in terms of automobile consumption, many new car purchase indicators were added last year.
At present, the provinces and cities in China that still maintain the car purchase restriction policy include Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Hangzhou, Shijiazhuang, Hainan, and Guiyang has previously canceled the purchase restriction. In 2022, among the first-tier cities with purchase restrictions, except for Beijing, the rest of the restricted cities have increased their car purchase indicators to varying degrees, with a total of 200,000 vehicles last year.
But many cities may face a dilemma.
The positive side is to respond to the central policy, stimulate consumption, continue to "release water" on the new energy vehicle indicators, and drive sales growth; On the other hand, although the current car ownership of 227 people per 1,000 people in China does not seem high compared with 852 in the United States and 634 in Japan, if the uneven distribution of Chinese population is taken into account, the four provinces of Xinjiang, Inner Mongolia, Tibet and Qinghai account for 49% of the entire land area, but only 4.2% of the population. In fact, the number of cars per thousand people in Wuhan, Xi'an, Nanjing, Zhengzhou and other cities is already quite high, which is why rumors of "introducing purchase restrictions" will emerge in these cities.
Therefore, possible changes in the purchase restriction policies of some large cities are also key variables affecting whether domestic new energy vehicle sales can exceed 10 million in 2023.