CATARC report - February 2016: New Energy Vehicle trends in China

Production of new energy vehicles declines significantly for the first time in 2016

2016/03/15

Production volumes in China (Summary)

This report is based on a report by Beijing CATARC Automotive Technology Development Company*;
MarkLines has edited and translated the company's report to prepare this report.

  Production volume of new energy vehicles (electric vehicles [EVs], plug-in hybrid vehicles [PHVs], and fuel cell vehicle [FCVs]; vehicles equipped with lead-acid batteries were excluded) in January 2016 in China increased by 1.5-fold year-over-year (y/y) to 16,307 units. By vehicle type, 65% of the production volume of new energy vehicles was EVs of which 76% was passenger cars. Production volume of all vehicle types declined by more than 50% in January compared to that of the previous month. In particular, production volume of special-purpose EVs significantly declined, dropping from over 20,000 units (from the previous month) to 409 units.

Fig. 1 Production volume of new energy vehicles (Aug. 2015 to Jan. 2016)



Production volumes in China

Table 1 Production volume of new energy vehicles by type in Jan. 2016

 
PHV
EV
Total
Passenger car
4,903
8,025
12,928
Bus
835
2,135
2,970
Special-purpose vehicle
0
409
409
Total
5,738
10,569
16,307

Fig. 2 New energy vehicle production shares by type (Jan. 2016)

Plug-in hybrid vehicle (PHV)

  Production volume of PHVs in January 2016 was 5,738 units, which was 36.1% of the production volume of the previous month. Of the 5,738 units, 4,903 units were passenger PHVs. Six automakers produced passenger PHVs in January. These automakers were BYD, Shanghai Automotive Industry Corporation (SAIC), Guangzhou Automobile Group (GAC), Zhejiang Haoqing Automobile, Brilliance BMW, and Chery Automobile. The BYD Tang consecutively ranked first for production volume of passenger PHVs. Production volume, together with that of the Qin, accounted for 83% of the passenger PHV production share. Production volume of the SAIC 550 plug-in hybrid electric vehicle (PHEV) exceeded 400 units. Considering that production volume in the fourth quarter of 2015 exceeded 1,000 units, production volume in January significantly declined. Production volume of the GAC Trumpchi PHV ranked third.

  All plug-in hybrid buses that were produced in January 2016 were either mid-size or large buses with a length exceeding 10 m. Production volume of plug-in hybrid buses was 835 units, which was the same number of units year-over-year. However, production volume declined by 84.4% month-over-month (m/m). The top five bus makers that produced the most plug-in hybrid buses in January were Beiqi Foton Motor, Zhongtong Bus, Hunan CSR Times Electric Vehicle, Zhengzhou Yutong, and Xiamen Golden Dragon Bus.

Electric vehicle (EV)

  Production volume of EVs in January 2016 was 10,569 units. Production volume of passenger EVs was 8,025 units, which was below 10,000 units for the first time since August 2015. 17 automakers produced passenger EVs in January. The top five automakers were Beijing Automotive Industry Holding Co. (BAIC), China Anhui Jianghuai Automobile (JAC), Hunan Jiangnan Automobile, BYD, and Chery. By automaker, BAIC was ranked first and JAC was ranked second for production volume of passenger EVs in January. BYD was ranked fourth due to the popularity of the new e6 among individuals and taxi companies. Chery was ranked fifth because production volume of the new eQ reached 1,000 units. Subsidy policies implemented by the government are forming the passenger EV market. For this reason, it is predicted that the passenger EV market will expand even if the purchase subsidy amount decreases.

  Production volume of electric buses in January 2016 doubled y/y to 2,135 units; however, production volume was 8% of that of the previous month. 23 bus makers produced electric buses in January. The number of bus makers declined by half compared to that of the previous month. The top five bus makers were Yutong Bus, Ankai Automobile, SAIC Motor Commercial Vehicle, Zhongtong Bus, and Beiqi Foton. Small buses with a length of 6 to 8 m accounted for 78.8% of the electric buses that were produced in January.

  Production volume of special-purpose EVs in January was 409 units. Production volume in January increased by 2.32-fold y/y; however, production volume declined to 1.7% of that of the previous month. 22 vehicle makers produced special-purpose EVs in January. Vehicle makers that made it to the top five for the first time were Shandong KAMA Automobile, Monde Golden Horse, and Shaanxi Tongjia Auto.



Trends in China

Auto loan down-payment rates for new energy vehicles to be lowered

  On February 16, 2016, eight government departments—the People's Bank of China, National Development and Reform Commission (NDRC), Ministry of Industry and Information Technology (MIIT), etc.—jointly released a "policy for stable growth of the industry, structural adjustment, and financial support for efficiency." In the policy, the government encourages the following three points.

  Lower auto loan down-payment rates of financial institutions, such as banks, for new energy vehicles and used vehicles. Also, promote the prevalence of auto loans and the development of the new energy vehicle industry. Currently, the lowest auto loan down-payment rate for Chinese brand vehicles is 30% and that of import vehicles is 50%.

  Accelerate the securitization of auto loans, and expand direct financing to industrial companies. By supporting companies of emerging industries and companies that are starting a business in the industry, the central government’s manufacturing development plan, "Made in China 2025," will be promoted.

  Provide insurances that are specifically for new energy vehicles and improve services of industrial insurances. Upon implementing an insurance system for equipment on a trial basis, extension of insurance coverage to new materials and main parts will be considered.

Subsidy policy for charging facilities and policy to further promote prevalence of new energy vehicles in "13th Five-Year Plan" are finalized

  On January 18, 2016, the Ministry of Finance (MOF), Ministry of Science and Technology (MOST), MIIT, NDRC, and National Energy Administration (NEA) officially released a "notification on the 13th Five-Year Plan." The central government will implement a subsidy policy for new energy vehicle charging facilities and a policy to further promote the prevalence of new energy vehicles. According to the subsidy policy, the central government will pay subsidies to local governments that are constructing charging infrastructures and promoting the prevalence of new energy vehicles in their provinces (districts/cities). For local governments to receive subsidies, they will need to meet certain conditions. Provinces (districts/cities) are divided into one of the three categories below and local governments are granted subsidies according to the number of vehicles that prevail in their area. The amount of subsidy paid to each local government will be determined according to the number of new energy vehicles that prevail in its area; however, how the subsidy can be used will be limited.

  Category 1: Provinces and cities where local governments focus on air pollution measures (Beijing City, Shanghai City, Tianjin City, Hebei Province, Shanxi Province, Jiangsu Province, Zhejiang Province, Shandong Province, Guangdong Province, and Hainan Province). The number of new energy vehicles to prevail in 2016, 2017, 2018, 2019, and 2020 will be at least 30,000 units, 35,000 units, 43,000 units, 55,000 units, and 70,000 units, respectively. In addition, new energy vehicle share of new vehicles purchased (addition or replacement) in these areas in 2016, 2017, 2018, 2019, and 2020 will be at least 2%, 3%, 4%, 5%, and 6%, respectively.

  Category 2: Provinces in the central area (Anhui Province, Jiangxi Province, Henan Province, Hubei Province, and Hunan Province) and Fujian Province. The number of new energy vehicles to prevail in 2016, 2017, 2018, 2019, and 2020 will be at least 18,000 units, 22,000 units, 28,000 units, 38,000 units, and 50,000 units, respectively. In addition, new energy vehicle share of new vehicles purchased (addition or replacement) in these provinces in 2016, 2017, 2018, 2019, and 2020 will be at least 1.5%, 2%, 3%, 4%, and 5%, respectively.

  Category 3: Other provinces (districts/cities). The number of new energy vehicles to prevail in 2016, 2017, 2018, 2019, and 2020 will be at least 10,000 units, 12,000 units, 15,000 units, 20,000 units, and 30,000 units, respectively. In addition, new energy vehicle share of new vehicles purchased (addition or replacement) in these areas in 2016, 2017, 2018, 2019, and 2020 will be at least 1%, 1.5%, 2%, 2.5%, and 3%, respectively.

  Each local government will need to meet another condition to receive subsidies. An implementation plan for the prevalence of new energy vehicles and a management plan for the construction of charging infrastructures will need to be prepared and submitted to five government departments (MOF, MOST, MIIT, NDRC, and NEA) by April 2016. If plans are not established according to the condition, the local government will not receive subsidies from the central government.

MIIT: Buses equipped with ternary lithium-ion batteries are excluded from new energy vehicle list

  At the "China EV100 Forum 2016—Power battery development and breakthrough" on January 24, 2016, Zhang Xiangmu, head of MIIT’s Equipment Industry Department, announced that MIIT has temporarily excluded new energy buses equipped with ternary lithium-ion batteries from the model recommendation list for power battery safety reasons.

  There are various types of lithium-ion batteries. Some examples are lithium iron phosphate, ternary lithium, lithium carbonate, and lithium titanate batteries. Ternary lithium-ion batteries have high power and good cycle performance; however, not much research and development on ternary material has been conducted in China. In addition, not enough tests have been conducted to verify the safety of the batteries for them to be used on buses.

  The central government plans to enforce stricter technical requirements for the safety of new energy vehicles. Buses equipped with a ternary lithium-ion battery will be evaluated under the current safety standards. These buses will be excluded from the model recommendation list of new energy vehicles until the evaluation is over.

Hangzhou City: additional measures are implemented through preferential policies to encourage purchase of new energy vehicles

  To encourage personal purchase of new energy vehicles, the Hangzhou municipal government implemented specific measures through preferential policies. In addition to subsidy payment and license plate acquisition, traffic regulation exemption and parking space advantage have been included. Charging equipment will be installed at public parking spaces, exhibition halls, gymnasiums, logistics center, and taxi stands. By 2020, charging a vehicle will be as convenient and easy as fueling a vehicle at a gasoline station.

  The Hangzhou municipal government set a new energy vehicle prevalence target of 7,500 units for 2016, but the government will aim for a target of 10,000 units. Breakdown of the target is as follows: 6,000 new energy lease vehicles, 500 new energy vehicles for use at the G-20 summit, and 1,000 new energy vehicles used as garbage trucks, mail trucks, and logistics vehicles.

Beiqi New Energy releases new energy vehicle product plan

  On February 1, 2016, Beiqi New Energy Automobile released its new energy vehicle product plan. The automaker will be launching a total of five new models covering the passenger car segment (A00, A0, and A) and SUV segment (A). In addition, the automaker will officially release a new brand, Zhongchuang, in April.

Beiqi New Energy Automobile models planned for launch
Model
Segment
Launch plan
EU260
A
Feb. to Mar. 2016
EX200
A0 SUV
Mar. to Apr. 2016
"Nationa"
A00
Sept. to Oct. 2016
"Zhongchuang"
End-2016
New D segment passenger car
D
2017

Two "Besturn" EV models to be launched in 2016

  He Zhikai, marketing manager of FAW Car, announced that all models from the "Besturn" brand will be new energy vehicles. According to the Changchun Development and Reform Commission, FAW New Energy Automobile is planning to sell two Besturn models—B30 EV and X80 EV—in 2016.

Changan launches Eulove EV in 2016

  Changan Automobile released its new energy vehicle strategy. The automaker will invest CNY 18 billion in the development of EV and hybrid vehicle (HV) technologies. By 2025, the automaker will launch 34 new energy vehicle models of which six will be electric minivans. According to Zhu Huarong, president of Changan, Changan will launch nine new energy vehicle models in 2016. The Eulove, which is one of the models to be launched in 2016, will have a cruising range of 200 km.

Reference:
Energy-saving and new energy vehicle network www.chinaev.org
CATARC Beijing Operations

* China Automotive Technology & Research Center (CATARC) is affiliated to the State-owned Assets Supervision and Administration Commission of the State Council (SASAC). CATARC assists the government in such activities as auto standard and technical regulation formulating, product certification testing, quality system certification, industry planning, policy research, information service and common technology research. Beijing CATARC Automotive Technology Development Company is the Beijing office and a sole subsidiary of CATARC. The Beijing office researches on policies, technical regulations, and standards for promoting Chinese automotive industry.