China’s total output of passenger battery electric vehicles (BEVs) in April reached 2,562 units, a 35.27 percent increase from the previous month, and a staggering 359.14 percent increase year-on-year. For the top three producers (Shanghai Maple, Chery and Zotye) their highest-output models all had microcar characteristics. Sales of passenger BEVs from BYD, JAC and others, however, still have yet to get going on a large scale. Passenger plug-in hybrid electric vehicle (PHEV) growth was also rapid, with 784 models produced, a 30 percent increase from March.
The share of total new energy vehicle (NEV) output from passenger vehicle manufacturers among all NEV output jumped 21 percentage points from March. The growth of passenger BEVs and PHEVs from March both increased more than 30 percent, but the respective growths for electric and plug-in hybrid buses declined more than 70 and more than 50 percent month on month. Lastly, passenger BEVs accounted for over 60 percent of NEV production in April and passenger PHEVs accounted for about 20 percent. Battery-powered and plug-in hybrid buses combined only accounted for 15 percent of the total, down from March’s 37 percent. Aside from the previous two Decembers, this is a new high for production, which means that the passenger BEV market is continuously growing.
Micro EVs far ahead of regular EVs
In April, Shanghai Maple was in the top spot for output. Its Kandi EV brand has been in production since December 2013. After a brief pause in January and February, production of Kandi EVs reached 2,511 units in March. The output of 1,536 Kandi EVs in April was lower than March, but the brand still beat out all others in its category.
Kandi’s rather sudden output increase comes from cooperation with Geely, and the market-level reason for it is Hangzhou’s “Micro-transport” project. The project has been going on since July 2013, and within those 10 months Hangzhou has opened four micro EV parking garages, and over 100 low-speed EV microcars have been rented out. Of course, Kandi’s goals go beyond just this. Zuo Zhong You Co. is in charge of the project and has official plans to invest in 100,000 more Kandi EVs, and to build 17 parking garages within the next four years. These will offer a combination of charging and battery swapping stations for vehicle charging.
Furthermore, according to a recent report, the Xiangshan neighborhood in Hangzhou’s Xihu District has been designated as a test community for EVs. Residents there can rent Kandi EVs at “group rates,” with annual rates set at ¥9,600 ($1,500) and monthly rates at ¥800. Kandi EVs will be leased in both short-period “Micro-transport” rentals and longer rentals. With enough capital, the Kandi EV fleet in Hangzhou will rapidly expand, especially because they qualify for Hangzhou’s local NEV subsidies.
In second place after Maple was Chery, and most of its output was the lead-acid battery QQ3 EV. This model was especially popular in Shandong, Jinan and Hebei Provinces, where low-speed EVs do best. On May 20, the Shandong Public Safety Bureau declared that it would be taking more action against non-regulation four-wheel micro EVs. Many low-speed EV brands were affected by this and their sales plummeted. However, the QQ3 was up to code, and its sales actually increased. Quite a few EV dealers have indicated to d1ev.com that they are thinking about selling Chery’s vehicles.
In third place was Zotye, with total output of 282 vehicles. Of these, the largest in output was the JNJ7000EVZ two-door sedan, which is a model produced under a joint venture that was set up in 2013 between Zotye and Zhejiang Xindayang Group. On May 10, Zotye’s Zhidou began selling in Suzhou, Jiangsu Province, with a starting price of only ¥48,800 including license plate and insurance. If the Zhidou can receive local subsidies, there will be nothing to limit its sales.
Further down the list are the regular EV companies JAC and BYD. These two have already made it into Beijing and Shanghai, and other locations have relatively high demand as well. However, because of problems in installing charging equipment they have yet to get large-scale sales in Beijing or Shanghai. BMW-Brilliance has begun leasing the Zinoro EV (based on the BMW X1) in Beijing, with higher production than ever before. However the company is only leasing and not selling, which may limit its ability to drive production. Dongfeng, SAIC and BAIC may all be in the media’s spotlight on a regular basis, but they have not kept up in their NEV output.
The three companies with the highest output all had vehicles with low-speed microcar characteristics. Once they receive license to sell, it will be price and business model that determine the winner. BYD, JAC, BAIC, Dongfeng and SAIC all have their eyes set on urban consumers, but are struggling nonetheless.
The first issue is that NEV incentive policies have not yet come into effect in some locations. Some subsidy amounts are not yet clear, making it difficult to price products.
Secondly, even though policies are in effect in Beijing, there are still problems with execution. For example, there are quite a few obstacles to installing self-serve charging units.
Cooperation from the power supply bureau, permission from property management companies and prices set by the installation companies are all vexing. Some EV owners have even resorted to using their own loose cords to charge.
Passenger PHEVs increased 30 percent from March
Passenger PHEVs have a clear advantage in the urban EV market. April’s output of 784 PHEVs is the highest d1ev.com research has seen since it began collecting data.
April’s passenger PHEV output was distributed as follows: BYD produced 717 of its Qin model, 91 percent of total output. The remaining 9 percent went to Roewe’s 550 plug-in, with 67 produced. The Qin massively overtook the 550 plug-in in output. The Qin’s price advantage and market development put it ahead of the 550 plug-in.
As for sales, according to Li Yunfei, vice president of BYD Sales, April Qin sales were 910 units, bringing cumulative sales to 3,294 units by the end of April.
That represents a new high for the NEV market. However, predictions for BYD sales performance have been overly optimistic, with BYD itself once mentioning the possibility of selling 250,000 vehicles in 2014. Because of this, the real data isn’t quite as impressive. Similarly, BYD said that Qin orders had increased to 9,000 units.
However, the Qin’s output went up just like it did for EVs, scaling with the progress of government NEV incentive policies. At the moment, passenger PHEV models like the Qin are not included in the local NEV catalogue in Beijing. Whether there will be barriers to entry elsewhere, and how much subsidies will be is still undetermined. Once this information is available, the Qin’s sales growth will be easier to predict.
(Translated by Oliver Spiro based on author’s article published on d1ev.com)