China: EVs and Plug-ins continue to grow

China continues on the path towards electrification: 780,000 "NEVs" represent the second-highest monthly figure of the current year. According to figures from the China Association of Automobile Manufacturers (CAAM), around 541,000 BEVs and 239,000 PHEVs were sold in July 2023. The fuel cell is not gaining momentum: It also belongs to the "NEVs," but only 200 new fuel cell cars were registered in July 2023. Our colleagues from Electrive.Net have broken down the numbers and discovered some interesting insights.

Plug-ins are making a massive comeback, while EVs account for a third of the market

While fuel cells remain a niche, the 541,000 BEVs represent an 18.2 percent increase year-on-year, but a 5.6 percent decrease compared to June (573,000 BEVs). The 239,000 plug-in hybrids correspond to a 77 percent growth year-on-year. Thus, the "New Electric Vehicles" generally followed the trend of combustion vehicles, where the numbers were less pronounced. Across all types of propulsion, approximately 2.39 million new cars were registered in China in July 2023 (+1.4 percent compared to July 2022, -9 percent compared to June 2023). This corresponds to an NEV share of 32.7 percent. In June, the number of New Energy Vehicles was larger at 806,000, but their share was only 30.7 percent.

Despite a decline compared to June 2023, BYD sells even more units

BYD managed to increase sales from June to July despite the market slowdown: The brand managed to register 262,161 NEVs, surpassing the June result by almost 10,000 vehicles. Of those, 261,105 are NEV passenger cars and 1,056 are NEV commercial vehicles. At BYD in China, the split between BEVs and PHEVs is roughly equal. By July 2023, BYD had sold 1,517,798 cars: This is extreme growth compared to the 1.69 million vehicles in the entire year 2022, but BYD originally planned to break the three-million mark for 2023, which now seems tight.

The gap between BYD and Tesla widens

In the July statistics for China, Tesla achieved 64,285 electric cars, although around half (specifically 32,862 Model 3 and Model Y) were exported. In China itself, GAC Aion managed to register just over 45,000 electric cars for the third consecutive month, this time 45,025 units. Chinese automaker Great Wall also set a new record for NEV sales, but the 28,896 units include plug-in hybrids.

Nio finally seems to be gaining traction in China

According to Electrive.Net, Nio stood out among EV startups in July 2023: 20,462 units mean almost a doubling compared to both the previous year and June 2023. Nio's first time surpassing 20,000 vehicles in a month was primarily due to the delivery start of the new mid-range SUV ES6, which is also set to be delivered in Europe soon.

VW swims around the 10,000-unit mark with many start-ups

Behind Nio, many startups and new brands (which are still often established in China as BEV or premium offshoots) follow at a respectful distance: Leapmotor sold 14,335 New Energy Vehicles (the company also sells vehicles with range extenders), followed by Geely's brand Zeekr with 12,039 BEVs, Xpeng with 11,008 BEVs (both aim to enter the EU market soon) and Neta with 10,038 NEVs. Volkswagen would come after Leapmotor: With 12,922 electric cars, the German manufacturer was even able to sell more electric vehicles than its new China partner Xpeng, with the ID.3 benefiting massively from the discount campaign: With 7,378 units, it was the best-selling electric VW in China – converted, the ID.3 is available there from 15,800 euros. The ID.4 reached 4,031 units, the ID.6 reached 1,513.

Smart reached over 4,000 units – that needs to be much more in perspective

And the Mercedes-Benz and Geely subsidiary Smart? Delivered 4,292 vehicles in China in July, with the #3 vehicle, which has been delivered in China since June 20, 2023, also contributing to this.

What does that mean?

The Chinese market is far from being a "New Electric Vehicle Market" – but it is on its way there. And it is shifting massively in favor of domestic manufacturers. VW is now among the smaller suppliers here, in the best company of many start-ups. Not a good sign.