• The top three brands, Tesla, BAIC Group and BYD Auto accounted for 40% of total EV sales during Q3 2019.
• Subsidy reductions in China continued to adversely affect sales.
• EV Sales declined in China and the US, but Europe experienced high growth.

The global passenger electric vehicle (EV)* sales have fluctuated during 2019. They reached a high point in the second quarter but fell back in Q3 to 480 thousand units – down 21% sequentially and 8% annually. When compared to Q3 2018, the EV sales increased in key European countries including Germany, UK, France, and Sweden, but declined in China and the US. Tesla, BAIC Group, BMW and Hyundai performed well, increasing their global EV market share after declining sales of EVs. But many Chinese brands lost market share due to difficult conditions in their domestic market.

Exhibit 1: Global Passenger Electric Vehicle Market Share by Brand (%) - Q3 2019

Commenting on the market dynamics, Soumen Mandal, Research Associate, said, “Reduced incentives and economic uncertainty in China heavily affected EV sales during the quarter. The latest subsidy cut in the country began in June when the government reduced the EV subsidy by 50%, adversely affecting sales during Q3 2019. Moreover, pressure on automakers to upgrade their technology to meet national standards reduced the number of new vehicles launches, which had a further effect of cooling demand. China is planning to cut subsidies completely from 2020 for new EV purchases will see slower growth in the next few years. Reduced subsidies are impacting local Chinese manufacturers, such as BYD, which has already seen deep cuts in its sales volume in 2019. A more measured reduction in subsidies would help the EV market in China adapt to the new pricing situation more easily.”

The top five EV model accounted for one-third of total sales in Q3 2019. Tesla improved its delivery capability around the world, with the Model 3 performing well in the Europe and US markets. Two out of the top five EV model are from the Chinese brands. BYD Yuan and SAIC Roewe Ei5 models were victims of subsidy cut which led them to slip from top 5 EV models in Q3 2019, despite these models providing good specifications.

Exhibit 2: Top 5 Electric Vehicle Models during Q3 2019

Commenting on the brands’ performance, Senior Analyst, Aman Madhok, noted, “Increasing overseas sales helped Tesla to increase its market share in the global EV market. The company is focusing on further increasing its foothold in Europe and China by setting-up new battery manufacturing plants in Berlin and Shanghai.”

Aman adds, “Following the reductions in local subsidies by the Chinese government, the big Chinese brands are looking to expand in global markets to improve their scale. Lower priced Chinese EVs are expected to do well in developing countries, but they face challenges in terms of safety, in-car experience and brand perception. Without an improvement in the China market situation, Chinese EV makers will likely face consolidation.”

Key Takeaways:

• Tesla sales grew 19% YoY, reaching 97,000 units, taking 20% of global EV sales. A 40% YoY increase in Model 3 sales due to strong overseas expansion drove Tesla’s performance.
• BAIC Group grew by 50% YoY, reaching 47,000 units (despite a slowing China market) due to a better performance of the upgraded Senova, EU and EX series.
• BYD EV sales were down by 30% YoY globally, reaching 45,000 units due to the revised New Energy Vehicle (NEV) policy in China.
• China is the largest EV market, accounting for 48% of global sales in Q3 2019. But new EV sales decreased by 16% YoY.

*Definitions

The report includes pure electric vehicles (also known as battery electric vehicles – BEVs) and plug-in hybrid electric vehicles (PHEVs). Hybrid electric vehicles (HEVs) are not included in the study.

Counterpoint Research tracks model-level EV sales in 55 countries worldwide.

Analyst Contacts:

Aman Madhok
+91 9560384548
[email protected]

@madhokaman

 Soumen Mandal
+91 8218140908
[email protected]

@passtubul

 Vinay Piparsania
+91 9971005882                                                                                                                                                                       [email protected]

@VPiparsania

 Neil Shah
+91 9930218469
[email protected]

@neiltwitz

 Counterpoint Research                                                                                                                                            [email protected]

@CounterPointTR