EV parc in China growing 10 times faster than in US
Dragon year
While the rest of the electric car world is coasting, China is slamming down the accelerator. Hard.
In China, EV registrations, including plug-in and conventional hybrids, soared by 92% in January compared to the same month last year.
The sheer size of the Chinese EV market makes this feat even more remarkable. At just under 765,000 units, more EVs were sold in China during the first month of 2024 than the next 19 countries combined. Every third passenger vehicle sold in China in January was electrified.
When measured in terms of GWh of battery power rolled onto roads in newly sold vehicles, China grew the size of its EV parc in January 2024 at more than twice the rate it did in January 2023.
At 30.2 GWh, the country was responsible for 57% of global battery capacity deployment during the month and over 91% in the Asia Pacific region.
The Chinese surge lifted global battery capacity deployment in January to a towering 64% year on year.
Euro uplift, US downshift
The European EV market looked in danger of being driven into a ditch at the end of last year with total GWhs added to roads in December down 39% compared with the same month the year before. Volkswagen idling some workers and curbing production at the continent’s largest EV plant were taken as a portent of the year ahead.
However, the region, led by the UK and France, which overtook Germany as the number one and two markets in Europe last year, made a dramatic recovery at the beginning of 2024 with the combined battery capacity of EVs sold during January up 33% year on year.
In the Americas, the EV market was suppressed by a decidedly bad month in the US with all EVs sold in January sporting just under 8.0 GWh of battery capacity. January’s year on year growth in the US barely reached double digits.
The US now also constitutes just 85% of the market in the Americas in GWh terms, down from more than 92% in January 2023. That is after second and third placed Canada and Brazil doubled and quadrupled battery capacity deployment in January, respectively.
Two speed market
Given the still soft broader economic conditions in China, the burst of activity in the automobile sector appears to be an outlier.
The bang with which Chinese car buyers entered the year was not a function of new tax breaks or other incentives to buy electric (the expiration of which has led to record Decembers in the past).
In June, Beijing extended tax breaks on EVs for four more years, currently up to maximum of $30,000 yuan (~$4,150) per vehicle, so there was no rush for shoppers to get behind wheels in January.
Interestingly, the new Chinese government rules have stipulations about minimum EV battery performance in cold weather, a factor often cited as a barrier for those in colder climes, like the US, when considering switching from gasoline-powered vehicles.
Not that winter willies in the US could fully relate to China’s cold weather woes. Comparatively few Chinese drivers can juice overnight at home, making cold weather range and performance pertinent.
Overall however, lack of choice plays a major role in why ex-China markets struggle to keep up. In China you can get behind the wheel of 110 assorted brands covering any possible segment and demographic.
In the US by comparison, a full 50% of power hours steered onto roads in January were from behind the wheel of a Tesla, and that’s despite a retarded Cybertruck delivery schedule.
The price is righter
Lack of choices aside, the easiest explanation is often the right one – prices.
At the end of last year BYD, the world’s top EV manufacturer by volume and the only vertically integrated battery maker in the country, unleashed a price war in China.
Given the cutthroat competition in the Chinese market and few OEMs with a business moat or long history of brand loyalists, BYD’s many competitors had no choice but to follow suit.
And BYD has been brutal. The Shenzhen-based company now sells its popular Qin Plus DM-I and Destroyer 05 plug-in hybrid sedans for 79,800 yuan, or just over $11,000 – that’s 20% cheaper than previous versions and comparable to incumbent gasoline-powered vehicles.
Just this week, BYD proved that the first cut is not always the deepest while slashing the price of its “Glory Edition” Seagull full electric hatch to an eye-watering 69,800 yuan.
That’s $9,700.
*Note: To produce the most accurate and granular results Adamas Intelligence analysis is based on end-user vehicle registrations, insurance data and retail sales not extrapolations from reported production, wholesale car markets, sales to dealerships or preliminary sales projections.
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