Compared to last month, China’s passenger vehicle market sales in November fell by 10%, coming in at 1.65 million units, signifying a cooling-down market, as opposed to the past a few months. However, Chinese passenger vehicle market sales this year will go over 21 million units, slightly better than last year’s figure and the global sales performance. Of the seemingly common November figures, EVs (BEV and PHEV) weren’t affected in the least bit by the economy and the pandemic, with a sales figure of 600k units and a whooping market share of 36.3%. As my estimation goes, 2022’s EV performance will surpass 5.5 million units and sit at 26% market share. In other words, there will be an EV in every four new car models sold in China this year! As for next year, their market share will surely exceed 35%, even challenge 40%! Compared to renowned research institutions’ and automakers’ estimates a few years ago, EV global market share accounting for 40% in 2030, China as the EV market pioneer will smash their time table by pulling ahead seven years!
In the surprising 2022 Chinese car market, we witnessed EVs’ explosive growth, EV giant BYD’s rise, the skyrocketing production of Tesla’s Shanghai factory, and booming trend of EV start-ups. All these miracles even happened under global hardships such as covid city lockdowns, the Ukrainian war, and the chip shortage. Since this year, VW’s EV plant investments and its joint venture with a Chinese autonomous driving startup, Toyota’s partnership with Chinese self-owned brand to manufacture EVs, Mercedes’ recruitment for a Chinese as the company CSO to focus more on the Chinese market, Ford’s EV-dedicated sales company establishment, etc. all pointed to international carmakers’ hasted efforts to transform their business models in the Chinese market to maintain their competitiveness in a few years or they will lose the market.
This year, Chinese self-owned brands own over 90% of the Chinese EV market. If EV penetration rate of the total market achieves 40% next year, according to my estimate, the Chinese EV market will surpass 8 million units, of which 7 million will go to self-owned brands. Under such enormous sales prowess, its profits and subsequent R&D resources will further increase Chinese brands’ technological advancements of intelligent EVs over their foreign counterparts. While international automakers’ response in recent years will only bear fruit at least three years later, so let say, disruptive changes of the auto industry will begin to happen in the Chinese market in a few years, and the effects will swiftly spread all over the world afterwards. Led by the US, western countries’ anti-globalization economic stance will be futile in the auto industry, which deeply roots in people’s livelihoods. Maybe this contrarian approach will grant China and other developing countries more space and time to catch up and overcome western countries in the new technological age of cars.