Volkswagen ID.7 is scheduled to be released in Europe and China in the fall of 2023, and in North America in 2024.
CNBC | Evelyn Cheng
BEIJING – Chinese brands are leading the country’s rapid shift to new energy vehicles, Volkswagen Sales in China are expected to hit their lowest level since 2012, according to a CNBC analysis of public data for the first three quarters of this year.
The German auto giant isn’t the only company in trouble, according to a CNBC analysis of 10 global car brands.
CNBC analysis shows that Nissan is expected to have its worst year in the market since 2009, while Hyundai’s sales will also hit their lowest level since at least 2009.
Car sales have fallen as China has rapidly shifted from internal combustion engine vehicles to new energy vehicles.This is a fast-growing battery and hybrid vehicle market Tesla and local brands such as BYD Captured.
In China, the world’s largest auto market, new energy vehicles have accounted for more than one-third of the country’s new passenger car sales so far this year.
This is according to the China Passenger Car Association, which also predicts that the local car market will grow 20% November a year ago.
Although Volkswagen is still a giant in China’s car market with annual sales of about 3 million vehicles, the German brand has not gained much attention in the field of electric vehicles. In July, the company chose to invest approximately US$700 million in Chinese electric vehicle startup Xpeng Motors to jointly develop two vehicles for China.
BYD is catching up quickly. According to CNBC, the Shenzhen-based company’s car sales exceeded 1 million vehicles for the first time in 2022, and its car sales in China are expected to reach 2.5 million vehicles this year.
toyotaCNBC found that China’s overall sales this year will be its worst year since 2020, with sales of about 1.8 million vehicles as the market struggles to transition to electric vehicles.
Alvin Liu, an analyst at Canalys Shanghai office responsible for global tracking and analysis of the new energy vehicle market, said that the development speed of China’s automobile industry is faster than the market growth rate.
He pointed out that with sales of about 23 million vehicles, BYD will occupy an important share of China’s 8.5 million large new energy vehicle market. Liu also pointed to the potential for original equipment manufacturers (OEMs) to compete through joint ventures with Chinese companies.
When Chinese consumers consider electric vehicles, foreign brands are increasingly unpopular with them. License plate restrictions in big cities like Beijing have incentivized locals to buy electric vehicles instead of traditional gas-powered vehicles.
A Bernstein survey of more than 1,500 Chinese consumers in August and September found BYD to be the brand most considered by Chinese EV buyers. Tesla follows closely behind, followed by NIO.
When it comes to next car-buying preferences, “With the exception of Tesla, the brand traction scores of all foreign brands have declined year-on-year, with Japanese brands (such as Toyota, Honda, and Nissan) experiencing the largest declines,” the report said. explain.
“Young people’s interest in traditional non-German high-end brands has also declined, as has interest in German high-end brands,” the report states.
Surveys show that German car brands have a certain degree of brand loyalty. But not necessarily for different energy sources.
“With the current shift toward electric vehicles among German and other premium brands, Tesla is becoming more attractive to them,” Bernstein reported.
Fierce competition
Although China’s new energy market is growing rapidly, Even for domestic brands, competition is fierce.
BYD launched Tesla’s most direct rival to date, the Denza N7, in July, and has also expanded its business from mass-market cars to ultra-luxury models, with its Yangwang-branded giant U8 SUV priced at more than 1 million yuan. (Over $138,000).
“If the competition is fierce this year, then the competition will be even fiercer next year.” On October 27, An Conghui, head of Geely’s electric vehicle brand Zeekr, told reporters in Mandarin (translated by CNBC).
He made the comments after Zeekr launched the 001 FR, a luxury electric sports car with specs apparently designed to compete with Tesla’s Model S Plaid at a lower price.
An claims that no car company will be able to copy the 001 FR within five years.
Zeekr sold just over 13,000 vehicles in China in October, setting a monthly delivery record, and the company has aggressive expansion plans for sales in Europe and the Middle East over the next two years.
Enter the global market
Brands such as BYD are also selling electric vehicles overseas.
This year, China is expected to become Moody’s analysis in August said China is the world’s largest automobile exporter, surpassing Japan and Germany.
The European Union launched a countervailing investigation into Chinese electric vehicle companies in September, showing how influential Chinese automakers are overseas.
—CNBC’s Michael Bloom contributed to this report.
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