EV Battery Archives - Counterpoint

All Charged Up: EV Battery Sales Soar 54% YoY in H1, CATL Leads

Chinese battery suppliers held nearly two-thirds of the EV battery market.
Tesla, BYD and Volkswagen installed nearly 45% of total EV batteries in H1 2023.
Annual EV battery demand is expected to reach 4TWh in 2030.

London, New Delhi, Boston, Denver, Beijing, Hong Kong, Seoul, Taipei, Toronto – November 8, 2023

The global EV* battery capacity sold in H1 2023 grew 54% YoY to reach over 300GWh, according to the latest research from Counterpoint’s Global EV Battery Tracker. During this period, global EV sales also experienced a substantial 43% YoY growth. CATL led the EV battery market, with BYD and LG Energy Solutions trailing by some distance. These top three companies collectively accounted for nearly two-thirds of the market in H1 2023. The leading regions in terms of EV battery installations were China, US and Europe.

Commenting on the market dynamics, Senior Analyst Soumen Mandal said, “The EV battery ecosystem is undergoing rapid transformation. Over the next few years, numerous new battery suppliers, such as ACC, Verkor, Northvolt and E4V, are expected to secure a substantial presence within the battery supply chain. Apart from specialist battery suppliers, automakers such as Tesla, Volkswagen, BMW, Mercedes-Benz and Stellantis are also working on in-house cell and pack manufacturing, which will make the battery supply chain even more competitive.”

Mandal added, “Currently, Chinese and South Korean suppliers dominate the industry. Chinese companies like CATL, BYD, CALB, Gotion, Sunwoda and Farasis collectively hold two-thirds of the market, while the three major South Korean players – LG Energy Solution, Samsung SDI and SK Innovation – account for around 25% market share. As EV sales gain momentum in various parts of the world, countries will try to establish self-sustaining battery supply chains. This will allow local industry participants to thrive while forcing some players to exit the market due to heightened competition.”

Automakers Tesla, BYD and Volkswagen accounted for nearly 45% of the total EV battery capacity sold in H1 2023. The surging sales of Tesla’s Model 3 and Model Y have played a pivotal role in driving the growth of CATL and LG Energy Solutions. CATL supplies batteries for the standard versions of the Model 3 and Model Y manufactured at Tesla’s Shanghai factory, while LG Energy Solutions serves as the primary battery supplier for the performance versions of the Model 3 and Model Y. On the other hand, Hyundai, Kia and Ford‘s EVs have played an active role in boosting the market share of SK Innovation, while Rivian and BMW predominantly rely on Samsung SDI as their battery supplier. In the North American region, Panasonic holds a key position as the primary supplier of batteries for Tesla models.

Commenting on the market outlook, Research Vice President Peter Richardson said, “In H1 2023, the average battery capacity of EVs stood at 50kWh. The rising sales of small, compact and mini EVs, particularly in China, are expected to maintain the average battery capacity in the range of 65kWh to 70kWh by 2030. Consequently, we expect that the total EV-driven battery demand will reach 4TWh in 2030.”

Richardson added, “The increasing demand for batteries, coupled with geopolitical tensions, is exerting upward pressure on the prices of lithium, a primary component of EV batteries. As an alternative, battery suppliers are looking for different chemistries like sodium-ion (NA-ion) that could drive down the cost of batteries and make EVs more affordable. CATL has already achieved a breakthrough in sodium-ion battery chemistry, and we expect to see the mass adoption of such batteries very soon. Since the low energy density of NA-ion compared to lithium-ion doesn’t make it suitable for performance EV models, we expect to see higher usage of NA-ion batteries in electric two-wheelers, three-wheelers and small passenger cars. A model of Chery’s iCar brand is expected to be equipped with CATL’s sodium-ion battery and go on sale in early 2024. On the other hand, solid-state batteries are still under development and will take some time before becoming available commercially. Making solid-state batteries affordable is the main challenge.”

*For EVs, we consider only BEVs and PHEVs. Hybrid EVs and fuel cell vehicles (FCVs) are not included in this study.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

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US EV Sales Up 79% YoY in Q1 2023 Helped by Tax Credit Subsidy

Tesla sold more EVs than the next 18 automotive groups combined in Q1 2023.
Brands like Hyundai, Audi, BMW, Volvo and Nissan remain ineligible for the EV tax credit.
US EV sales expected to reach near 1.5 million units in 2023 if economic conditions continue to improve.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – June 15, 2023

US passenger electric vehicle* (EV) sales soared over 79% YoY in Q1 2023, according to the latest research from Counterpoint’s USA Passenger Electric Vehicle Model Sales Tracker. This strong growth helped the US surpass Germany to become the world’s second-largest EV market, the largest being China. Battery EVs (BEV) accounted for 81% of all passenger EV sales in the US while plug-in hybrid EVs (PHEVs) made up the rest. In Q1 2023, Tesla’s sales outperformed the combined sales of the next 18 automotive groups, which collectively represent 34 automotive brands.

Commenting on the market dynamics, Research Analyst Abhik Mukherjee said, “Total US passenger vehicle sales improved YoY in Q1 2023. The US economy is showing signs of recovery with lower inflation and improving consumer sentiment. Although EV sales saw strong growth during the quarter, those of conventional passenger vehicles remained flat. One reason was the introduction of an EV tax credit of up to $7,500, which has played a crucial role in driving up EV sales. Currently, around 20 models in total offered by Tesla, GM, Ford, Stellantis, Rivian and Volkswagen are eligible for the tax credit. However, strict eligibility conditions set by the US government have excluded brands such as Hyundai, Nissan, BMW, Audi and Volvo from benefiting from the EV tax credit scheme in 2023.”

The top 10 EV models in the US accounted for 69% of overall passenger EV sales during the quarter. Tesla’s Model Y retained its title of the best-selling EV model, while it also earned the title of best-selling passenger car model globally. Apart from BEVs, PHEVs are also gaining popularity in the US.

Commenting on the market outlook, Research Director Jeff Fieldhack said, “With the US economy showing signs of recovery, the auto industry, particularly the EV sector, is being helped by government policies announced last year. Tax credits for new and even used EVs are helping consumers, while investments in streamlining the EV battery supply chain, the establishment of a robust network of EV charging stations and the setting up of battery recycling plants nationwide will all support EV sales growth. Therefore, we expect US EV sales to reach around 1.5 million units in 2023 if economic conditions continue improving.”

*Sales refer to wholesale figures, i.e. deliveries from factories by the respective brand/company.

*For EVs, we consider only BEVs and PHEVs. Hybrid EVs and fuel cell vehicles (FCVs) are not included in this study.

The comprehensive and in-depth ‘USA Passenger Electric Vehicle Sales Tracker, Q1 2018-Q1 2023’ is now available for purchase at report.counterpointresearch.com.

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

Analyst Contacts

Abhik Mukherjee

Soumen Mandal

Neil Shah

Jeff Fieldhack

Counterpoint Research

press@counterpointresearch.com

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Climate Change Concerns Aid LG Electronics’ Q1 Numbers

The revenue for Q1 2023 stood at KRW 16.26 trillion, a 5.7% YoY decline.
The operating profit of the company declined by 15% YoY.
The revenue from the vehicle solutions segment grew 27% YoY to reach KRW 2.4 trillion.

LG Electronics has generated relatively steady Q1 2023 earnings results thanks to the stabilization of material costs and the continued sales of high-end home appliances. The heat pumps and energy storage devices helped it earn more as the climate change restrictions tightened.

The company’s revenue declined 5.7% YoY in Q1 2023 to KRW 16.26 trillion ($12.75 billion), while the operating profit declined 15% YoY to KRW 1.36 trillion ($1.06 billion) owing to sluggish global demand. Although the profit dropped YoY, it was a considerable improvement over the losses in the previous quarter.

The business portfolio is experiencing growth through qualitative measures, particularly in expanding B2B segments such as vehicle components and system air conditioners. Besides, non-hardware business revenue continues to increase. The vehicle component solutions segment raked in high profits, contributing almost 15% to the total revenue, up from 11% in Q1 2022.

Financial highlights

The consumer electronics segment’s revenue fell 5.5% YoY to reach KRW 11.38 trillion ($8.9 billion). However, the operating profit increased by 92% owing to lower logistics costs, efficient management of raw material supply, improved spending efficiency and active measures to enhance cost structure. The contribution of this segment to LG’s Q1 operating profit rose to 89.7% from 40% in Q1 2022.
The revenue of the vehicle solutions segment grew 27.1% YoY to reach KRW 2.39 trillion ($1.87 billion) driven by high order backlogs and the electric vehicle (EV) boom in the automotive market. Supply chain management improvements for key components, like semiconductors, played a crucial role. The operating profit grew to KRW 54 billion ($42.3 million), compared to the loss of KRW 6.7 billion ($5.6 million) in Q1 2022. Although the segment contributed just 4% to LG’s Q1 operating profit, it is touted as the future growth driver.
Revenue from other businesses, which include business solutions, kept declining YoY to reach KRW5 trillion ($1.95 billion), falling 25%. The operating profit dropped 91% YoY to KRW 85 billion ($66.7 million). The segment’s contribution to LG’s Q1 operating profit was only 6.3% compared to 61% in Q1 2022.
LG Innotek’s revenue grew 10.7% YoY to KRW 4.4 trillion ($3.43 billion). The operating profit decreased by 60.4% to KRW 145 billion ($114 million). This brought LG’s consolidated revenue to KRW 20.4 trillion ($16.01 billion).

Market outlook

Amid declining consumption due to economic downturn concerns, consumer electronics revenue is expected to fall while profits will remain sluggish in the next quarter. The decreasing IT demand will also have negative impacts on yields. The huge order backlog (KRW 80 trillion) and the ongoing transition to EVs will drive the vehicle solutions segment revenue. Based on the high growth within EV markets, it is expected that the EV component business will continue to take up a larger share in the future. A reliable portfolio of in-car infotainment systems, e-powertrain, headlights and unique solutions will maintain LG’s competitive advantage.

LG Electronics is going aggressive on increasing its technological advantage over competitors. This year, the company plans to invest over KRW 5 trillion ($4 billion) in its most significant capital expenditure in 10 years, mainly in the automotive electronics business. This move aligns with the business strategy of focusing on long-term growth and prosperity. The R&D spending has also been increased by 10% this year. LG wants to sustain growth and ensure consistent profitability by proactively and adaptively addressing shifts in demand across various regions and segments. It also aims to expand eco-friendly enterprises in pursuit of revenue growth through energy-efficient and environment-friendly products.

*LG Innotek’s numbers are not included in the total revenue and have been mentioned separately.

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Price Cuts Boost Tesla Revenue in Q1, Profit Slumps Compared to 2022

2 million vehicle deliveries are achievable in 2023 if the macroeconomic situation doesn’t worsen.
Gross profit was down 17% YoY to $4.5 billion due to price cuts, raw material inflation, exchange rate impacts and other factors.
3.9 GWh of energy storage was shipped during Q1 2023, Tesla’s highest yet.

Tesla’s Q1 2023 deliveries stood at 422,875 vehicles globally and registered a total revenue of $23.3 billion, a YoY increase of almost 25%. With Tesla announcing price cuts for its models starting from January, vehicle deliveries also saw a 36% YoY boost. Tesla’s sales increased significantly across the US and China, accounting for 40% and 33% of its global deliveries, respectively. Almost 98% of Tesla’s sales came from the Model Y and Model 3. During Q1, the Model Y became the best-selling car in Europe and the best-selling non-pickup vehicle in the US. The Model 3’s sales also increased significantly in Europe, with almost 29,000 of them being sold in the continent during Q1. As the Berlin factory only produces the Model Y, all the Model 3s sold in Europe were imported from China.

Financial highlights

Revenue from Tesla’s automotive segment stood at nearly $20 billion, an 18% YoY increase. Automotive sales accounted for almost 95% of the revenue but revenue from the sale of regulatory credits and vehicle leasing declined significantly.
Tesla’s revenue from other business lines, such as energy deployment and services, increased by 78% YoY to $3.3 billion. During Q1, Tesla deployed a record Megapack storage, totaling 3.9 GWh and growing 360% YoY, the highest in a single quarter.

Although Tesla generated strong revenue in Q1, gross profit declined by 17% YoY to $4.5 billion and net profit declined by 23% to $2.5 billion. High vehicle deliveries and growth in other business lines helped the revenue, but the lowered vehicle ASPs, high raw material costs due to inflation, increased logistics costs, costs associated with the ramping up of the 4680-cell production, lower-than-expected utilization of the Berlin factory and negative exchange rate impacts all played a role in the lowered profits compared to a year ago.
Tesla’s Q1 operating profit was 11.42%, a decline of 4.6% sequentially. Tesla claims to have a better position than its competitors who are still struggling through the challenges of reducing EV unit costs. Tesla aims to leverage its position as a cost leader, which it has achieved through increased penetration of in-house designed controllers, batteries and drive units.
Q1 R&D expenses were $771 million, 3.3% of total revenue. Tesla is developing a 360-degree ecosystem – Tesla OS. This will help the company reduce dependency on third-party software and cloud subscriptions for its day-to-day work, besides helping in the vertical integration of software-based services and better cost control.

Outlook

Tesla’s strong position in the auto market has also helped its market outlook. Price cuts have made Tesla’s vehicles more affordable and with its Model Y and Model 3 becoming eligible for the tax credit subsidy in the US, we expect Tesla to capture over 50% of the country’s EV market. In its earnings call, Tesla also signaled more price cuts. It also plans to open another factory in Shanghai to focus on the production of cells and batteries as part of its 100-GW cell factory capacity announced last year.

Tesla expects to start deliveries of its long-awaited Cybertruck in Q3 2023. The company is also working on its next-generation vehicle platform.

With a strong start, Tesla aims for 1.8 million global deliveries during 2023, but 2 million is achievable if the macroeconomic situation does not deteriorate significantly.

EV Sales in US up 54.5% YoY in 2022; Tesla Market Share at 50.5%

BEVs accounted for 80% of EV sales in the US in 2022.
In 2022, Tesla captured over 50% of the US EV market.
EV sales are expected to exceed 1.9 million units in 2023.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – April 4, 2023

Passenger electric vehicle* (EV) sales** in the US grew 54.5% YoY in 2022, according to the latest research from Counterpoint’s Global Passenger Electric Vehicle Model Sales Tracker. Battery EV (BEV) sales grew by almost 70% YoY to account for more than 80% of all EV sales in 2022. Tesla remained the market leader in 2022 with more than 50% market share. Tesla sold more cars than the other 17 automotive groups combined.

Commenting on the market dynamics, Research Analyst Abhik Mukherjee said, “Although overall passenger vehicle sales in the US declined in 2022, EV sales increased to represent 7% of all US passenger vehicle sales. Tesla is dominating the US EV market while other automotive giants like Ford, General Motors, Stellantis, Volkswagen and Hyundai are struggling to provide strong competition. But still, we are seeing new players like Lucid Motors, Karma, Fisker and Vinfast entering the US EV space, underlining the market’s potential. Moreover, with the recent price cuts by Tesla and all versions of Tesla’s Model Y becoming eligible for the EV tax credit subsidy, it is expected that Tesla will take an even higher market share.”

The top 10 best-selling EV models accounted for 69% of total EV sales in the US. All four Tesla models were present in the top-10 bestseller list for 2022. Hyundai’s IONIQ 5 and Kia’s EV6 made a significant impact, entering the list within a year of their US launch.

Discussing the market outlook, Research Director Jeff Fieldhack said, “High interest rates due to macroeconomic pressures during 2022 negatively affected vehicle sales in the US. In 2023, EV sales are expected to reach over 1.9 million units but only if economic headwinds do not severely impact the market, like in 2022. With automotive OEMs and battery manufacturers joining hands to set up battery manufacturing plants across the US, the battery supply chain is expected to become smoother and component costs will moderate, making the potential US EV market greater than 10 million per year by 2030.”

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media, and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects, and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts

Abhik Mukherjee

Abhilash Gupta

Soumen Mandal

Jeff Fieldhack

Peter Richardson

Counterpoint Research

press@counterpointresearch.com

Related Posts

LG Electronics Operating Profit Stumbles in Q4 2022

The operating profit of LG Electronics* declined by 133% YoY in Q4 2022.
The revenue for Q4 2022 stood at KRW 15.47 trillion, a 1.6% growth YoY.
The revenue from the vehicle solutions segment grew 44.6% YoY to reach KRW 2.4 trillion.

LG Electronics’* total revenue in Q4 2022 was KRW 15.47 trillion ($11.37 billion), a mere 1.6% YoY growth. This brought the company’s 2022 total revenue to KRW 64.71 trillion ($50.3 billion). Although LG registered a positive YoY revenue growth during Q4 2022, the operating profit declined by 133% YoY, causing losses of KRW 104 billion ($76.6 million). This was primarily due to increased marketing expenditure, increased raw material prices, and currency devaluation compared to the US dollar. The business was also impacted by the extension of geopolitical risks in Europe and interest rate hikes in many nations to reduce inflation. The worsening macroeconomic conditions weakened consumer sentiment, leading to a decline in consumer electronics sales. The vehicle solutions segment stood as a bright spot due to strong demand and order backlog from auto OEMs.

Financial highlights

The consumer electronics segment’s revenue fell 5.5% YoY to reach KRW 10.88 trillion ($8 billion). Its operating profit decreased by 127% due to rising marketing costs and fixed cost burdens. The contribution of this segment to LG’s Q4 revenue declined to 70.2% from 75.5% in Q4 2021.
Revenue from the vehicle solutions segment grew 44.6% YoY to reach an all-time high of KRW 2.4 trillion ($1.76 billion). This was primarily due to increased OEM orders and an improved automotive supply chain situation globally. Negative external factors like logistics costs and raw material supply chain are easing. Despite increasing expenses associated with running additional manufacturing subsidiaries, profits improved on increased sales. Vehicle solutions accounted for 15.5% of the total revenue in Q4 2022.
At the end of 2022, the vehicle solutions segment had a backlog amounting to KRW 80 trillion ($59 billion), underscoring the company’s position as a key supplier to the global auto industry. Infotainment accounted for more than 60% of the backlog value, xEV parts for 20%, and safety and convenience components for the rest.
Revenue from other businesses grew by 6.7% YoY in Q4 2022 to reach KRW 2.2 trillion ($1.62 billion). But low demand for IT products and global economic headwinds sent the operating profit down by 195% YoY.
LG Innotek’s revenue grew 14.4% YoY in Q4 2022 to KRW 6.5 trillion ($4.8 billion). The operating profit decreased by 60.5% to KRW 169 billion ($124 million). This brought LG’s consolidated revenue to KRW 21.8 trillion ($16.06 billion).

Market outlook

The anticipation of growing inflation, geopolitical uncertainties, mass layoffs and significant concerns about the economy weakening during the initial months of 2023 is likely to further impact LG’s profit in Q1 2023. LG aims to increase profitability by proactively cutting expenses and optimizing cost structures. LG stated that it would continue to improve the competitiveness of its premium goods like OLED TVs. Despite challenging financial conditions, LG is likely to invest around KRW 22 trillion this year in developing new sectors and broadening its business portfolio.

The vehicle solutions segment has the highest potential to earn high profits in coming quarters owing to a robust strategy to secure long-term product orders and the current order backlogs, despite uncertainties around vehicle demand in 2023. Besides, due to the high demand for infotainment and xEV components, this segment is likely to grow further, leading to a higher share of LG’s revenue.

*LG Innotek’s numbers are not included in the total revenue and have been mentioned separately.

Global EV Sales up 61% in Q2 2022; BYD Leads Market

Global passenger electric vehicle (EV) sales* reached 2.18 million units in Q2 2022.
BYD Auto overtook Tesla to become the top-selling EV brand globally.
The top 10 EV models accounted for more than 30% of global EV sales in Q2 2022.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – August 29, 2022

Global passenger electric vehicle* (EV) sales grew 61% YoY to reach 2.18 million units in Q2 2022, according to the latest research from Counterpoint’s Global Passenger Electric Vehicle Model Sales Tracker. In total EV sales, battery electric vehicles (BEVs) accounted for almost 72% and plug-in hybrid electric vehicles (PHEVs) for the rest. China remained the market leader in EV sales, followed by Europe and the US. China’s EV sales increased by almost 92% YoY in Q2 2022 to reach 1.24 million units from just 0.64 million units in Q2 2021.

Commenting on the market dynamics, Senior Analyst Soumen Mandal said, “As the global semiconductor shortage has eased a bit, automakers are able to cater to the increasing demand for EVs. Moreover, EV sales would have been higher if China had not experienced fresh COVID-19 outbreaks during March. Stringent lockdowns in and around major provinces halted the production ramp-up during April, which resulted in China’s passenger vehicle market recording its biggest drop since the COVID-19-hit March 2020. The situation improved only after lockdowns were lifted during the latter half of May. The second half of 2022 is expected to deliver better results, but economic downturns, energy crisis, supply chain bottlenecks and rising geopolitical tensions may hinder the growth of China’s automotive market, especially EVs.”

Market Summary

BYD Auto: For the first time, BYD Auto became the top-selling EV brand, dethroning Tesla. During Q2 2022, BYD Auto shipped more than 354,000 EV units, an increase of 266% YoY. The company officially stopped production and sales of internal combustion engine vehicles in March 2022 and has been focusing on the development of BEVs and PHEVs. More than 60% of BYD’s sales during the quarter came from its top three models – BYD Song, BYD Han and BYD Qin. The company is slowly penetrating the European market. It has already begun operations in Norway and is looking to start business in Germany, Sweden and the Netherlands.

Tesla: Tesla’s global sales during Q2 2022 grew 27% YoY to over 254,000 units, falling short of expectations. Although business in the US increased, its China business was affected by COIVD-19 shutdowns. Tesla sold just 98,000 cars in China during Q2 2022. Cumulative sales in China during April and May fell by 49% YoY. This was the lowest for the automaker since the COVID-19-hit 2020. But its sales during June improved by almost 115% YoY. Despite COVID-19 clouding Tesla’s Q2 sales, it remained the global leader in the BEV segment.

Wuling: The joint venture between SAIC, GM and Wuling has proved to be a success as the Wuling Hongguang Mini EV is the best-selling EV model in China. The model has been the undisputed market leader since its release in the second half of 2020. During Q2 2022, Wuling grew by 16% YoY to hold the third rank in the global EV market.

BMW: BMW’s EV sales during Q2 2022 increased by 18% YoY. The company has a more prominent presence in the PHEV segment. However, its BEV sales experienced a higher QoQ growth rate (18%) in Q2 2022 compared to its PHEV sales (2%). BMW’s aim to have 2 million BEV units on the road by the end of 2025 is motivating it to make significant developments in the EV category. The BMW X3 and i-series models are spearheading the company’s push in the BEV segment, while the 5-Series, 3-Series and X5 models are doing the same in the PHEV segment.

Volkswagen: Volkswagen’s EV sales declined 9% YoY in Q2 2022. Its shipments across Europe and the US declined by 44% YoY and 74% YoY, respectively. Bottlenecks in the supply of semiconductors and other automotive components due to Russia’s invasion of Ukraine, together with rising inflation, pushed EV sales down in these two markets. However, sales in China grew 115% YoY in Q2 2022. Apart from the supply chain crisis, the company’s internal issues and failure to develop new proprietary software for its vehicles are impacting the company’s EV shipment targets.

Source: Counterpoint Research Global Passenger Electric Vehicle Model Sales Tracker, Q1 2018 – Q2 2022

Discussing the reasons for the rise in EV sales, Research Vice President Neil Shah said, “Incentives play a crucial role in increasing EV adoption. For example, China’s strong incentive program for both automakers and consumers has helped the country become the global EV leader. China extended its consumer-side subsidies until 2023, even after deciding to end them in 2021. Moreover, China’s dual-credit policy for automakers has been a massive success and the government is planning to phase out consumer-side subsidies as its EV market reaches maturity. In contrast, lower subsidies in European countries have led to slow growth in EV sales. China’s EV market grew by over 90% YoY in Q2 2022, whereas Europe’s EV market increased by just 16% YoY. Rising EV sales in European nations have led to a discontinuation of many consumer-side subsidies on car purchases with the focus shifting to establishing improved charging infrastructure, including incentives for consumers to install charging points.”

Further commenting on EV subsidies, Shah said, “Recently, the US has brought a new EV policy which includes attractive incentives for both automakers and consumers. Benefits upto $12,000 are available for automakers and consumers on the purchase of a new EV. As a result, we expect to see an increase in EV sales in the US. Apart from these big markets, smaller markets like India, Japan, Thailand, South Korea and Malaysia have started providing various benefits for EV buyers and automakers either directly as a rebate in prices or tax exemption.”

The top 10 EV models accounted for more than 30% of global EV sales in Q2 2022. Tesla’s Model Y remained the best-selling EV model. Wuling’s Hongguang Mini EV moved up to the second place, pushing Tesla’s Model 3 to third place. The Hongguang Mini EV’s long streak of being the best-selling model in China was broken by the Model Y in June 2022. Six out of the top ten best-selling EV models during the quarter were from Chinese OEMs and are mostly only available in China.

Source: Counterpoint Research Global Passenger Electric Vehicle Model Sales Tracker, Q1 2018 – Q2 2022

Commenting on the market outlook, Research Vice President Peter Richardson said, “The automotive industry is unlikely to fully recover from the semiconductor shortages until 2023. We do not expect global passenger EV sales to exceed 10 million units in 2022 considering the COVID-19 outbreaks, production shutdowns due to the power crisis, component shortages and rising consumer price inflation.”

*Sales here refer to wholesale figures, i.e. deliveries out of factories by respective brands/companies.

*Under electric vehicles (EVs), we are considering only battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs). Hybrid electric vehicles and fuel cell vehicles (FCVs) are not included in this study.

The comprehensive and in-depth ‘Global Electric Passenger Vehicle Model Sales Tracker, Q1 2018 – Q2 2022’ is now available for purchase at report.counterpointresearch.com.

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

Analyst Contacts

Soumen Mandal

Neil Shah

Peter Richardson

Counterpoint Research

press@counterpointresearch.com

Related Reports:

Global EV Shipments Up 79% YoY in Q1 2022; Tesla Remains Leader

In Q1 2022, global electric passenger vehicle (EV) shipments exceeded 1.95 million units.
Passenger battery electric vehicle (BEV) shipments grew 90% YoY during the quarter.
EV shipments are expected to cross 10 million units by the end of 2022 and 58 million units by 2030.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – July 8, 2022

After surviving the COVID-19 pandemic and semiconductor shortages, the global automotive sector continued to recover in early 2022. Passenger vehicle shipments, especially electric passenger vehicle* (EV) shipments, grew during the first quarter. According to the latest research from Counterpoint’s Global Electric Passenger Vehicle Model Shipments Tracker, EV shipments grew 79% YoY in Q1 2022 to reach 1.95 million units. Of these, battery electric vehicles (BEVs) accounted for 73% and plug-in hybrid electric vehicles (PHEVs) for the rest. China remained the market leader in EV shipments, followed by Europe and the US. China’s EV shipments increased 126% YoY in Q1 2022 to reach more than 1.14 million units from just 0.5 million units in Q1 2021.

Commenting on the market dynamics, Senior Research Analyst Soumen Mandal said, “The EV market is witnessing a boom. However, shipments would have been higher if the automotive supply chain was not affected by the Ukraine crisis and fresh COVID-19 waves in China in March 2022. With EVs comprising just 12% of the total passenger vehicle shipments during the first quarter of 2022, there is a lot of scope for expansion. Fresh players are entering the market to benefit from the opportunity. To counter new entrants, existing players are using leading-edge technologies to have improved battery, superior IVI system and higher levels of ADAS in their EV models as major selling points.”

Tesla: Tesla has registered phenomenal growth over the course of a year. The company’s shipments grew 68% YoY in Q1 2022 and are expected to cross 1.3 million units by the end of 2022. After operations started at the Shanghai Gigafactory in 2019, Tesla’s China shipments skyrocketed. With the Berlin Gigafactory becoming operational in March, Europe sales are likely to increase in Q2 2022. Tesla is currently the global EV market leader. In Q1 2022, it sold more vehicles than the next three OEMs combined in the BEV segment. Tesla will face competition from BYD, NIO and XPeng in China while Volkswagen is gearing up to compete on the global front. Despite this competition, Tesla is likely to remain the market leader in the BEV segment for the next few years.

BYD Auto: BYD emerged as China’s top EV seller during Q1 2022. Its EV shipments increased by a whopping 433% YoY to reach more than 0.28 million units. This was due to BYD increasing its production of BEVs and PHEVs while completely halting its internal combustion engine business. In Q1 2022, BYD’s BEV and PHEV shipments grew 271% YoY and 857% YoY, respectively.

Wuling: The joint venture between SAIC, GM and Wuling has proved a success as the Wuling Hongguang Mini EV is the most sold EV model in China. Compared to Q1 2021, Wuling grew by just 14% and currently holds the third rank in the global EV market. Wuling achieved high EV shipments by just operating across China and Indonesia. Expanding across the SEA countries will help its business to grow as competition in the region is not that high. An early entry will help Wuling to secure a significant market share.

BMW: Over the years, BMW has developed its business more in the PHEV segment than in BEV. BMW’s 16% YoY growth is mostly due to its offering of several new and improved PHEV models. BMW’s BEV shipments are predominantly driven by the company’s i-series models, while BMW Series 3 and Series 5 models are driving its PHEV shipments.

Volkswagen: Volkswagen is working hard to compete with Tesla in Europe, but its efforts have been disrupted by the supply crisis caused by Russia’s invasion of Ukraine. With its ID models, Volkswagen wants to capture a significant share of the EV segment. During Q1, Volkswagen’s EV shipments increased by 25% YoY. China remains Volkswagen’s top EV market, followed by Europe and North America. Across all major regions, the company’s all-electric ID.4 model registered most shipments.

Source: Counterpoint Research Global Electric Passenger Vehicle Model Shipments Tracker, Q1 2022

Discussing the reasons for the rise in EV shipments, Mandal further added, “Technological development is the key reason behind the increase in EV shipments. Battery technology has undergone recent breakthroughs. These developments have made batteries capable of longer ranges and longer overall lives. Range anxiety, one of the barriers to EV adoption, has reduced. The development of composite charging network infrastructure, subsidies from governments on EV purchases and increasing fuel prices combined with increasing environmental awareness are other reasons.”

On battery technology, Research Vice President Neil Shah said, “Different compositions of lithium-ion batteries and the development of LFP batteries have been a game changer in this field. Battery chemistries like NMC, NCA and LFP are used widely for their high energy density and safety. After an increase in the price of lithium due to the Ukraine crisis, OEMs are transitioning to LFP batteries which use very little lithium and are safer than NMC and NCA composition batteries. Alongside LFP, manufacturers are also working on revolutionary solid-state battery technology. Besides being safer, solid-state batteries have higher energy density and will be able to outperform other battery chemistries. In 2021, NIO showcased its new ET7 with a solid-state battery of 150kWh. But this was later replaced by a semi-solid-state battery for the vehicle’s launch in March 2022. Despite several clear advantages, the high cost of solid-state batteries will limit their potential for mass adoption in the near term.”

The top 10 EV models accounted for a third of global EV sales in Q1 2022. With Tesla’s new gigafactories coming up across the world, its Model Y and Model 3 currently hold the first two positions. Wuling’s budget model, the Hongguang MINI EV, has been the best-selling model in China for more than 15 months. Seven out of the top ten EV models are from Chinese OEMs. This shows the development of Chinese EV market over the past few years.

Source: Counterpoint Research Global Electric Passenger Vehicle Model Shipments Tracker, Q1 2022

Commenting on the market outlook, Research Vice President Peter Richardson said, “With many countries aiming to phase out gasoline-powered vehicles by 2040, car makers are facing a seismic change. Not only are they having to move to electric drivetrains, but cars are becoming smart, connected and increasingly able to drive themselves. This is the most tumultuous period since the auto industry was established more than a century ago. According to Counterpoint’s Global Passenger Car Forecast, EV shipments are expected to exceed 10 million units in 2022 and reach around 58 million units in 2030. There will be a fight for existence as incumbent auto manufacturers use their scale and manufacturing expertise to fend off new entrants that have no legacy business to protect. The current economic headwinds are likely to favor deep-pocketed incumbents, but some new entrants will either survive on their own or be acquired by established players.”

The comprehensive and in-depth ‘Global Electric Passenger Vehicle Model Shipments Tracker, Q1 2018-Q1 2022’ is now available for purchase at report.counterpointresearch.com.

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

Analyst Contacts

Soumen Mandal

Peter Richardson

Neil Shah

Counterpoint Research

press(at)counterpointresearch.com

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Could Germany Reduce Its Auto Industry’s Reliance on Batteries from Asia?

The EU wants to foster home-grown companies to compete with Chinese and Korean competitors and to take battery cell production into its own hands. Germany is apparently in the center of it. The German government wants to reduce the dependence of its automakers on Asian electric vehicle (EV) battery suppliers and protect its auto industry jobs at home. Therefore, it is now trying to move further towards vast battery cell production by EU companies. Its EV battery push, however, might be coming too late.

The EU Is Now About to Make Progress with Plans for EV Battery Manufacturing

The EU has lagged far behind its economic counterparts in building up battery manufacturing capacity. Despite the world’s biggest incentives for EVs, the batteries to support the policies have been made in China and Korea. Although there are various manufacturing initiatives underway in the EU, most of them are by the Korean players. However, the EU is now about to make progress with plans for battery manufacturing to compete with those imports under the state aid rules. The European Commission has been working on both an EU Battery Alliance (EBA) and an EU Action Plan on rechargeable batteries. Initiatives include the introduction of state aid for EV battery research and billions of euro fund for EU companies to build gigantic battery factories.

The EBA was launched by Vice President for Energy Union Maroš Šefčovič with member states and industry in October 2017. It aims to stimulate entrepreneurs to manufacture ‘Made by Europe’ batteries and to create a competitive and sustainable supply chain in Europe. Consequently, a Swedish battery supplier, Northvolt started construction in mid-2018 on the first phase of its planned battery gigafactory by partnering with Scania and BMW respectively.
The main outcome of the EBA has been the strategic action plan for batteries adopted in May 2018. It was built on discussions with key industry stakeholders, interested member states and the European Investment Bank. Under the action plan, the EU is taking a proactive approach to major raw materials for batteries to secure its strategic independence. It is not only mapping and exploring EU resources for secondary raw materials through recycling batteries, but also trying to set up free trade agreements for raw materials from outside the EU.

Germany Will Play a Central Role in the Development of Battery Cell Production

Over the past ten years, Germany has invested around €500 million into battery cell research, but until now nothing much has come of it. Chancellor Angela Merkel has been in favour of battery cell development, but major German manufacturers have been reluctant to push ahead and are even more dependent than ever on Asian suppliers. However, recently the German government stressed the urgency of the project strongly and expressed willingness to build vast battery cell production lines in Germany with a budget of €1 billion.

At the Networking Conference Electromobility 2018 in Berlin, the German Minister of Economics Peter Altmaier announced a €1 billion investment to support local battery cell production. Then highlighted that the goal is to take 30 percent of global demand for battery cells from German and European production by 2030.

The funding aims to reduce the country’s dependence on Asian EV battery cells and to protect German manufacturing jobs. Germany has faced a potential threat from the decline in demand for gasoline-fueled vehicles. The budget will be divided between a consortium assembled to produce lithium-ion batteries for EVs and a research facility to develop solid-state battery technology with higher energy density, longer driving range and greater safety standards.
Most important task will be the construction of gigawatt-sized lithium-ion battery cell production lines in Germany. The German government hopes that the first production line could be available from 2021 and those batteries must be smart, have a high energy density and be easy to recycle. It is looking to have 30 percent of such production coming from Germany and Europe by 2030, with a forecast that the battery cell market in 2030 will have a global volume of €600-800 billion.

Global Li-Ion Battery Capacity Projection (GWh)

Source: Counterpoint Research

Conclusion

Chinese and Korean leaders have already been on mass production of lithium-ion batteries over the past decade. Gaining cost-competitive advantages, they plan to ramp-up huge additional production capacity accordingly. For the EU, therefore, it does not seem effective to spend significant efforts to establish new production lines on current commercial lithium-ion technology. Instead, we suggest that the EU concentrates on strengthening its supply chain of raw materials through recycling batteries for now. Germany, meanwhile, needs to focus on a lab-scale research and pilot lines for solid-state batteries rather than lithium-ion battery market entry. Only then, could it seize an opportunity to hold a dominant position in the advanced battery market optimized for the next generation vehicles for the long term.

Source: Counterpoint Research

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Could Germany Reduce Its Auto Industry’s Reliance on Batteries from Asia?

The EU Is Now About to Make Progress with Plans for EV Battery Manufacturing

Germany Will Play a Central Role in the Development of Battery Cell Production

Global Li-Ion Battery Capacity Projection (GWh)

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Financial highlights

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Market Summary

The EU Is Now About to Make Progress with Plans for EV Battery Manufacturing

Germany Will Play a Central Role in the Development of Battery Cell Production

Global Li-Ion Battery Capacity Projection (GWh)

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