China's new energy vehicles lead the global market and become a shining new business card of Made in China

CNR, Beijing, December 31 (Reporter Yang Liuqing) The automobile industry is a strategic and pillar industry of the national economy, and it is one of the important areas to stimulate domestic demand and expand consumption. In recent years, the new energy vehicle industry in mainland China has developed rapidly. According to the statistical analysis of the China Association of Automobile Manufacturers, in November 2023, the production and sales of new energy vehicles exceeded one million units for the first time. From January to November 2023, the production and sales of new energy vehicles reached 8.426 million units and 8.304 million units, respectively, an increase of 34.5% and 36.7% year-on-year, respectively, and the market share reached 30.8%.

Echoing the rapid development of the industry, the new energy vehicle industry chain is also developing and growing. Tianyancha data shows that as of now, there are more than 1.06 million new energy vehicle-related enterprises in mainland China, of which more than 314,000 new registered enterprises will be added from January to November 2023, an increase of 24.6% year-on-year from 2022.

Cui Dongshu, Secretary-General of the National Passenger Car Market Information Association, said that the current development situation of the new energy vehicle market is good, showing the characteristics of overall rapid growth and continuous structural innovation.

The frequent release of policy "gift packages" has injected strong impetus into the development of the industry

The 2023 Central Economic Work Conference proposed to stabilize and expand traditional consumption and boost bulk consumption such as new energy vehicles and electronic products. This is the content related to the consumption of new energy vehicles mentioned by the Central Economic Work Conference for two consecutive years.

Since 2023, various departments and localities have launched a series of policy "gift packages" to support the development of the new energy vehicle industry, injecting strong impetus into the development of the new energy vehicle industry. In June 2023, the Ministry of Finance, the State Administration of Taxation, and the Ministry of Industry and Information Technology issued the "Announcement on Extending and Optimizing the Vehicle Purchase Tax Reduction and Exemption Policy for New Energy Vehicles" to support the development of the new energy vehicle industry and promote automobile consumption.

In recent years, the charging infrastructure in mainland China has developed rapidly, and the world's largest number, the widest range of services, and the most complete types of charging infrastructure system have been built. In June 2023, the General Office of the State Council issued the "Guiding Opinions on Further Building a High-quality Charging Infrastructure System", which also proposed that by 2030, a high-quality charging infrastructure system with extensive coverage, moderate scale, reasonable structure and perfect functions will be basically built, which will strongly support the development of the new energy vehicle industry and effectively meet the important goal of the people's travel and charging needs.

With the arrival of the peak consumption season at the end of the year, many places have intensively introduced policies to boost consumer confidence and stimulate the development of the automobile industry. Nanjing will launch the second round of automobile consumption subsidies in 2023, and consumers can enjoy the corresponding amount of consumption subsidies for the purchase of eligible cars. The Sichuan Provincial Development and Reform Commission issued the "Several Measures on Recovering and Expanding Consumption", proposing to further expand the consumption of new energy vehicles, accelerate the process of comprehensive electrification in the public sector, and increase the promotion and use of new energy vehicles in the public sector such as official business, public transportation, and taxis. Changsha City launched the automobile consumption promotion activity in the fourth quarter of 2023, investing 20 million yuan in automobile purchase subsidies to further release automobile consumption demand.

Wang Qing, deputy director of the Institute of Market Economy of the Development Research Center of the State Council, told the CCTV reporter that policy support is a major positive for the development of the current new energy vehicle industry, around the expansion of automobile consumption, to promote the development of new energy vehicles The relevant policies introduced are not only directly stimulating consumer purchases, but also have a significant role in stimulating market sales growth, and more importantly, it is more important to enterprises, consumers and market confidence, and bring positive effects to economic development.

The market competition is fierce, and the share of self-owned brand car companies continues to rise

With the rapid development of the new energy vehicle industry, independent brands have come to the fore, and the competition among car companies has become increasingly fierce.

According to the latest data released by the Passenger Car Association, the retail sales of independent brands in November were 1.15 million units, a year-on-year increase of 31% and a month-on-month increase of 1.8%. The domestic retail share of domestic brands was 55.3% in the month, up 1.9 percentage points year-on-year, and the cumulative share of domestic brands in 2023 was 52%, an increase of 4.7 percentage points year-on-year. In November, the wholesale market share of domestic brands was 59.7%, an increase of 4.6 percentage points over the same period last year.

Looking back on 2023, many companies in the "arena" of new energy vehicles have accelerated their speed: Xiaomi Auto has completed its debut and officially released its first mass-produced car, BYD's 6 million new energy vehicles have rolled off the assembly line, the Wenjie M9, which has received Huawei's in-depth technical support, has entered the high-end market, and NIO, which focuses on the high-end market, plans to launch a second and third brand to occupy more market segments...... The market generally believes that in 2024, the new energy vehicle industry will open a more brutal "knockout competition".

CICC's research report pointed out that the current competition in the passenger car market is still fierce, and price reduction promotions have become an important means to boost sales in stages, hedge profit pressure, and maintain brand power, but the room for car companies to reduce prices is relatively limited. Therefore, the competition will focus on scale, technology and process innovation in the future, while data accumulation and operational efficiency will also play an important role.

In Wang Qing's view, moderate competition is reasonable, which can make some competitive enterprises stand out, but competition should be within a reasonable range, and a simple price war will consume long-term profits of enterprises. "Enterprises need to occupy market segments by improving the competitiveness of products, catering to the new needs of consumers, improving technical level and service experience, which is sustainable." Wang Qing also stressed that for new energy vehicles, in addition to the growth of automobile production and sales itself, charging and other supporting systems need to be followed up quickly, otherwise it will form a bottleneck restricting the development of the industry.

Competition is intensifying, and many enterprises have increased R&D investment and actively chose cooperation to improve their competitiveness. It is understood that the first phase of Xiaomi Auto's R&D investment exceeded 10 billion yuan, with a total of more than 3,400 engineers in the R&D team, and the core R&D investment of Cialis AITO exceeded 12 billion yuan......

The pace of "going out" of new energy vehicles has accelerated, and the export data is bright

In 2023, China's new energy vehicles will accelerate the pace of "going global", and the export data will be eye-catching, becoming a shining new business card of Made in China. According to the China Association of Automobile Manufacturers, from January to November 2023, China's automobile exports were 4.412 million units, up 58.4% y/y, passenger car exports were 3.72 million units, up 65.1% y/y, and new energy vehicles were 1.091 million units, up 83.5% y/y. It is widely expected that China is expected to become the world's largest auto exporter for the first time in 2023.

According to CICC's research report, China's electric vehicle technology has competitive advantages, strong product strength, and the trend of export acceleration remains unchanged. With the accumulation of scale and technological advantages, it is optimistic that Chinese automobiles will accelerate to the world, and the next few years will still be a stage of rapid development of overseas sales.

Wang Qing believes that the main reason for the rapid growth of China's new energy vehicle exports is the continuous improvement of the cost performance and technological experience of domestic products. The fierce domestic competition objectively promotes China's new energy vehicles to polish product innovation, enhance competitiveness, and strive to lead in product richness and performance.

According to the "2024 China Auto Market Overall Forecast Report" released by the China Association of Automobile Manufacturers, it is estimated that the sales volume of new energy vehicles in mainland China in 2024 will be about 11.5 million units, and the export volume will be about 5.5 million units. With the gradual recovery of China's economy, it is expected that the demand for automobiles will continue to maintain steady growth, and the Chinese auto market will enter a new stage of 30 million units in the future.

Cui Dongshu said, "At present, the overall situation of China's new energy vehicle exports is better, but the pressure is gradually emerging, and it is necessary to further adapt to the localization of its own products, especially in terms of electrification and intelligence, and make effective improvements in line with the local market, including operating systems, application software, etc., in order to make China's new energy vehicles sell better locally." Wang Qing believes that the export of new energy vehicles is expected to maintain a high growth rate, but new energy vehicles will also face the challenges of foreign supply chain and product supply capacity, and how to open the stock market after opening the overseas incremental market is also a major difficulty.

Although the road is far, the journey is coming. Swimming into the vast sea of the world market, China's new energy vehicle industry is expected to enter a new stage of growth in 2024.

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