2019 Sales Forecast in China (CAAM): NEVs to make up 1.6 million of 28.1 million vehicles sold

Drop in Sales of Low-End SUVs, Healthy Secondhand Vehicle Market

2019/04/02

Summary

中国の新車販売台数の増減率

 According to the China Association of Automobile Manufacturers (hereafter referred to as CAAM), vehicle sales in the Chinese market in 2019 are expected to see year-over-year (y/y) sales equal to the previous year of 28.1 million vehicles (as of January 2019). New passenger vehicle sales are forecast for equal y/y numbers with 23.7 million vehicles, and commercial vehicles are expected to see a y/y growth of 0.7% with 4.4 million vehicles. Sales of new low-end SUVs are expected to decline due to the effects of decreases in income in medium and small cities. However, the consumer base that cannot purchase new vehicles will move to the secondhand vehicle market, thus energizing the secondhand vehicle market.

 Sales of new energy vehicles (NEVs) are expected to continue to increase thanks to the vehicle purchasing tax exemption implemented in January 2018. Furthermore, starting in 2019, OEMs that manufacture 30,000 or more internal combustion engine passenger vehicles are required to manufacture or import a set percentage of NEVs, and both Chinese OEMs and foreign OEMs are releasing more NEV models.

 Each OEM group’s 2019 sales target and production plan varies widely by group, with Dongfeng Motor Group and BAIC Group planning for major increases. Geely will instead maintain their 2018 levels of 1.51 million vehicles.

 



Related Reports:
2018 China market: 28.081M units for new car sales, 23.71M units for passenger cars (Feb. 2019)
SAE China 2018:NEV industry and related policies (Jan. 2019)
SAE China 2018:NEVs and Big Data (Jan. 2019)
SAE China 2018 :Intelligent and Connected Cars (Dec. 2018)
Emerging Chinese EV makers: Rapid development with IT investment and partnerships(Apr. 2018)
The current situation of China’s NEV market (Dec. 2017)



CAAM’s 2019 sales forecast: 23.7 million passenger vehicles, 4.4 million commercial vehicles

 According to CAAM’s January 2019 forecast, it expects 28.1 million vehicles to be sold in 2019, including 23.7 million passenger vehicles for a similar y/y forecast, and a 0.7% increase in commercial vehicle sales at 4.4 million vehicles. While the Iranian market, a vital market for China, still hasn’t recovered, other regions have maintained stability, with exports forecasted for over 1 million vehicles. However, imports are expected to see continued effects of the U.S.-China trade dispute and were set at 1.1 million vehicles.

 According to the MarkLines database, vehicle sales between January and February 2019 saw a y/y decrease of 15% to 3.849 million vehicles, with passenger vehicles seeing a 17.6% decrease at 3.241 million vehicles. Commercial vehicles saw a 2.2% increase at 608,000 vehicles.

 

Sales Volume in China

(thousands of units)

2013 2014 2015 2016 2017 2018 2017
y/y
2019
CAAM
forecast
2018
y/y
Grand total 21,984 23,492 24,598 28,028 28,879 28,081 -2.8% 28,100
0.1%
Passenger car 17,929 19,701 21,146 24,377 24,718 23,711 -4.1% 23,700 -
Commercial vehicle 4,055 3,791 3,451 3,651 4,161 4,370 5.0% 4,400 0.7%

(Source: China Association of Automobile Manufacturers (CAAM) and MarkLines Data Center.)
Note 1: All the sales figures are on a wholesale basis, and include exports and commercial vehicles.
Note 2: From 2013, some minivan models were reclassified as MPVs.
Note 3: The minivan category includes all passenger cars except sedans and hatchbacks, and SUVs and MPVs.



The Chinese market in 2019: Increased speed to adjust to intensified competition and environmental changes, with consumption in regional cities being key

 CAAM believes that the Chinese automobile market in 2019 will see intensified competition making for a year with major changes in the environment, such as trade disputes, deregulation of foreign capital, support for the State VI emission standards, internet of vehicles (IoV), and the expansion of mobility services to provoke changes in the relationship users have with automobiles and in consumption behavior. OEMs are speeding up internal changes to support these various environmental changes and strengthen management systems. In 2018, excluding seasonal factors, July saw the lowest monthly vehicle sales. However, sales recovered by December and 2019 vehicle sales are expected to be equal to levels in 2018.

 When viewing the Chinese market from a macro perspective, various factors have exerted an influence, such as GDP, economic divergence between major corporations and small and medium-sized companies, decreased investment and consumption, decreased leverage, decreases in real estate inventory, and the U.S.-China trade dispute.

 The new vehicle market also has a pessimistic outlook. Restrictions on online peer-to-peer (P2P) finance and healthy secondhand vehicle sales will affect the new vehicle market. The consumer base that cannot afford new vehicles is moving to the secondhand vehicle market. In 2018, Chinese brand vehicles saw a decrease in sales, while in 2019, declines in income in Tier 3 cities will cause sales of low-end SUVs to drop. However, the government remains adamant in its policy to become a developed country by 2025, and because the Chinese market has a potentially wide consumer base for automobiles*1, vehicle sales are expected to increase in the mid-term

 As part of its economic stimulus package, on January 29th, 2019, the Chinese government released the “Notice to further optimizing supply to promote steady growth in consumption (2019).” This will help encourage consumers to replace their automobiles and purchase digital home appliances, vitalizing the economy as well as improving the quality of life in regional cities and rural areas. The following six items were related to automobiles. 1. Subsidies for replacing vehicles under the “State III” emissions restrictions or below for a new vehicle, 2. Optimizing subsidization structure for NEVs such as increasing subsidies for purchasing advanced NEVs, 3. Subsidies for replacing cargo vehicles weighing 3.5 tons or less, or a passenger vehicle with an engine displacement of 1.6 liters or higher in accordance with the disposal of three-wheeled vehicles in rural areas, 4. Relaxation of restriction of the entry of pickup trucks in designated regions (Hebei, Liaoning, Henan, Yunnan, Hubei, Xinjiang), 5. Stimulation of the secondhand vehicle market by reducing value-added tax (VAT) for secondhand vehicle dealers from 3% to 2%, 6. Optimization of vehicle management measures in regional cities.

*1:According to an announcement by the National Development and Reform Commission, there are 170 automobiles owned for every 1,000 people in China.



New energy vehicle sales forecast: 2019 to see a 27.5% increase to 1.6 million vehicles

新エネルギー車販売台数

 CAAM’s 2018 NEV sales forecast was at 1 million vehicles, but reached a y/y increase of 25.5% to 1.256 million. While 2019’s NEV sales are expected to reach a y/y increase of 27.4% at 1.6 million vehicles, only 148,000 vehicles were sold in January to February, at 114,000 EVs and 34,000 PHVs.

 In 2019, OEMs that manufacture or import more than 30,000 internal combustion engine passenger vehicles must have a certain percentage of NEVs in their production numbers. Until 2018, NEVs were primarily released by major Chinese OEMs, but in 2019, foreign joint venture OEMs plan to actively release EVs and PHVs for the NEV credit policy.

 The policy announced a plan of action relating to NEV charging capabilities in December 2018. This plan aims to improve charging infrastructure technology and quality, operational management, policies relating to construction sites, and equipment warranties within three years. As of January 2019, there are a total of 853,000 charging infrastructure facilities. Likewise, the government is releasing measures to support the increase in NEV sales with policies to promote consumption released in December 2018 and the exemption of tariffs on NEV batteries implemented on January 1st 2019.

 BYD, China’s largest EV OEM, set its 2019 NEV passenger vehicle sales target at a modest y/y increase of 19% or 270,000 vehicles. BYD is also a battery manufacturer involved in battery recycling, and has focused on the field of urban transportation in recent years.

 BJEV, a subsidiary of the BAIC Group, which manufactures China's best-selling EV in 2018, the EC180 EV passenger vehicle, unveiled three models from its ARCFOX brand at the 2019 Geneva Show. ARCFOX has partnerships with Daimler, Magna, and Huawei for product development, manufacturing, connectivity, and autonomous driving data processing chips. BJEV aims to finance itself through the market since becoming listed in 2018.

 SAIC Motor Passenger Vehicle, a subsidiary of SAIC Motor that manufactures vehicles for its own brands Roewe and MG, aims to double its y/y NEV sales in 2019.

 GAC NE began construction of its intelligent plant in December 2018 and will focus on NEV production. In 2019, it aims to sell 30,000 to 40,000 vehicles. In March, the automaker began pre-order sales for its Aion S, featuring AI technology.

 Of emerging EV makers, NIO, which Tencent has a stake in, will release a new model, the ES 6, following its ES 8. While the automaker will have two models in the market, it has a modest sales target of 20,000 to 30,000 vehicles. NIO was listed on the N.Y. Stock Exchange in 2018, and planned to construct its own plant in Jiading, Shanghai, but in March 2019, it announced it would cancel its plans, with its vehicles continuing to be manufactured at JAC Motor. Future Mobility Corporation (FMC), which acquired Tianjin FAW XIALI Automobile’s subsidiary FAW Huali for CNY 1 moved its production facility to Nanjing, where it plans to manufacture Byton models until the end of 2019.

2018 2019
Units(thousand) y/y(%) Plan/target (thousand)
NEV sales in China 1,256 62% 1,600
BYD*1 227 99% 270
BJEV 158 53% 220
SAIC*2 96 Almost double 190
Changan Automobile 870 42% -
JAC 640 125% 80
Chery/Chery New Energy Automotive 91 151% 200
GAC NE 20 - 30-40
YUDO 7 - Plans to jointly release
NEVs with FAW Car.
NIO 13 - 20-30
WM Motor - - 100
Singulato - - 20

*1.Not including commercial vehicles.
*2.Baojun and Roewe models.
(Source: Created by MarkLines based on CAAM, press releases, and media reports)



Chinese automaker's sales projections for 2019

 The 2019 sales plans for the 18 major Chinese automaker groups were compiled into the list below. Plans and target vehicle numbers were split between groups, with some having an optimistic outlook and others with a more conservative one, while other groups did not release detailed figures. Dongfeng Motor Group and BAIC Group plan a slight increase from the previous year while BYD has relatively optimistic plans of a y/y increase of 25%. GAC Motor Group, which has steadily increased its vehicle sales, set its target at a y/y growth of 8%. Geely, which has greatly increased its vehicle sales annually since 2014, has set a conservative goal of 1.51 million vehicles, unchanged from the previous year.

 

2019 sales plan of major Chinese automakers

(thousand units)

OEM group/brand 2018y(Result) 2019y(Plan/Target)
▽SAIC 7,025 n.a.
SAIC VW 2,065 2,000
SAIC GM 1,970 Plans to release 18 models (including updated models)
SAIC GM Wuling 2,072 n.a.
SAIC Motor Passenger Vehicle 702 1,000
SAIC MAXUS 126 180(Locally156)
Nanjing Iveco 31 n.a.
Shanghai Sunwin Bus 1 70
SAIC-Iveco Hongyan 58 70
▽DFG 3,831 4,000
Dongfeng Nissan 1,156 1,190
Zhengzhou Nissan Automobile 76 64(Pickup55)
Dongfeng Infiniti 29(Locally) n.a.
Dongfeng Venucia 132 150
DFCA(Dongfeng Automobile) 154 160
Dongfeng Honda 721 n.a.
Dongfeng-Peugeot-Citroen Automobile 253 235
Dongfeng Yueda Kia 370 410
Dongfeng Renault 50 70
Dongfeng Passenger Vehicle (Fengshen) 95 120
DFSK (Sokon) 262 n.a.
Dongfeng Yulon 7 n.a.
Dongfeng Liuzhou Motor 183 245
Dongfeng Liuzhou Passenger Car 128 180
Dongfeng Liuzhou Commercial Vehicle 55 65
Dongfeng Commercial Vehicle 172 208
Dongfeng Special Commercial Vehicle 29 30
▽China FAW Group 3,418 n.a.
FAW VW 2,051(VW brand1,391, Audi brand 660) 2,127(VW brand1,445, Audi brand 682)
FAW Toyota 723 745
Tianjing FAW Xiali 19 n.a.
FAW Car 238 310
 (of which) FAW Mazda 109 110
FAW Haima 11 n.a.
FAW Jiefang 332 343
▽BAIC Group 2,402 2,450
Beijing Hyundai 810 900
Beijing Benz 485 560
Beijing Foton 545 600
BJEV 158 220
BAIC Motor's own brand vehicle 160 239(Beijing Off-road vehicle 50)
▽Changan Automobile Group 2,138 2,460
Changan Automobile 922 Plans to release 8 models.
Jiangling Motor Holding 276 n.a.
Changan Ford 378 Release of 10 Ford and Lincoln brand models.
Changan Mazda 163 160
Changan PSA 4 Release of a new sedan in the second half of the year.
▽GAC Group 2,149 2,320
GAC Honda 742(Honda brand 732) 727
GAC Toyota 580 855
GAC Fiat-Chrysler 125 n.a.
GAC Mitsubishi 144 170 or more
GAC Motor 535 600
Honda Automobile (China) 13 n.a.
▽Brilliance Auto Group 699 n.a.
Zhonghua/Jinbei brand 170 n.a.
BMW Brilliance 466 n.a.
▽Great Wall Motor 1,053 1,200
▽Chery Automobile Group 753 n.a.
Chery Holdings 539 JETOUR brand:150
Chery JLR 68 n.a.
Chery New Energy Automotive 50 n.a.
Cowin 18 62
▽BYD group 521 650
▽Geely Holding (excluding Volvo Cars) 1,501 1,510
▽Jiangling Motors Co., Group
462 500-600
Jiangling Motors 198 n.a.
▽Zotye Holding Group 255 n.a.
▽Lifan Motors Group 102 n.a.
▽Fujian Motor Industry Group 191 n.a.
▽Haima Automobile Group 68 n.a.
▽China Heavy Duty Truck Group 327 400
Heavy-duty truck 127 200
Light truck 135 200
Bus 2 n.a.
▽Shaanxi Automobile Group 184 190(Domestic sales 155)

(Note:Created by MarkLines using information provided by various announcements, news reports, hearings, and other sources of information (partial estimates included)). Figures given here are on a wholesale basis, but some figures include retail sales. Therefore, subtotals may not match or add up to the totals.

 

2019 sales plans of non-Chinese automakers

(thousand units)

2018y(Result) 2019y(Plan/target)
GM 3,645 Plans to release roughly 20 models (including updated models)
Brand Baojun 840 n.a.
Wuling 1,181 n.a.
Chevrolet 523 n.a.
Cadillac 228 Plans to release 2 new models
Ford 752 Plans to release roughly 10 models.
Imported car 16 n.a.
VW Group 4,210 4,130
JV(FAWVW, SAIC VW) 4,210 4,127
Imported car 196 n.a.
PSA 258 n.a.
Brand Peugeot 139 235
Citroen 114
DS 4 Release of a new model every year.
Imported car 1 n.a.
Daimler 707 n.a.
Mercedes-Benz Cars 485(Locally) Of its plans to release roughly 15 models, approximately 10 will be SUV models.
Imported car193
Mercedes-Benz Van 29 Release of a middle-class van 
BMW Group 641 Locally production X2
Volvo Cars 131 four facelifts
FCA Group 163 n.a.
Renault 217 n.a.
Toyota 1,475 1,600
Lexus brand 160 n.a.
Nissan 1,564 1,600
Honda 1,432 n.a.
Mazda 272 270
Mitsubishi 140 n.a.
Subaru 22 25
Hyundai-Kia 1,180 1,320

(Note:Created by MarkLines using information provided by various announcements, news reports, hearings, and other sources of information (partial estimates included)). Figures given here are on a wholesale basis, but some figures include retail sales. Therefore, subtotals may not match or add up to the totals.

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Keyword
Chinese Market, Policy, Own brand, NEV, Battery, EV, PHV, SUV

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