China’s EV market slide extends as Geely, BYD September sales disappoint

2 min read

Defying peak seasonal patterns, China’s electric vehicle market gave little indication of a rebound in September as Geely, BYD, and JAC Motors reported dismal sales figures on Thursday, pressured by a reduction in government subsidies and broader economic headwinds.

Why it matters: Flagging sales in new energy vehicles (NEV) is weighing on Chinese players angling to gain a foothold in the world’s largest EV market absent government support.

  • NEVs sales in China declined for the first time in July, falling 5% year on year to 80,000 units, according to figures from the China Association of Automobile Manufacturers (CAAM).
  • In August, sales dropped much more sharply, falling 16% year on year despite a modest sequential uptick in total units delivered to 85,000.
  • Auto industry watchers had forecasted NEV sales would begin to recover in September after bottoming out in July and August as a result of a reduction in government subsidies.

Detail: China’s largest EV maker BYD reported a notable drop in sales to 13,681 NEVs in September, declining 18% month on month and sinking by more than half compared with the same period a year ago.

  • June sales for the Warren Buffet-backed automaker rose 55% from a year earlier to a record 26,571 units, but dropped nearly 40% sequentially in July when Beijing pulled NEV subsidies.
  • Geely figures were similarly gloomy: the carmaker sold 8,765 units in September, roughly 16% less than it did in the same month last year.
  • The Zhejiang-based auto giant’s July sales plunged 72% month on month after subsidies ended with just 4,476 NEVs sold.
  • Sales of JAC Motors’s battery electric vehicles also fell 24% year on year to 6,747 units in September. Nio’s manufacturing partner reported 30% year on year growth for the first nine months of the year, in a sharp contrast to a stunning 125% annual increase the same period a year prior.
  • BYD and Geely declined to comment when contacted by TechNode on Friday. JAC Motors was not immediately available for comment.

Briefing: China will cut subsidies for electric vehicles to spur innovation

Context: Given the continued decline in NEV sales in China, CAAM reduced the annual sales projection 6.3% to 1.5 million in August. The industry has been further affected by several incidents earlier in the year involving vehicle fires, scaring off potential consumers, and China’s trade dispute with the US.

  • China’s NEV industry had maintained double-digit growth over the past three years after hitting a record high five-fold increase in 2015. Sales volume in 2018 reached about 1.26 million vehicles, growing 62% compared with a year earlier.