The Chinese new energy vehicle (NEV) market experienced a gloomy February as the coronavirus outbreak hit sales and brought pressure to the whole automobile industry.
Sales of NEVs in China, the world’s largest automobile and electric vehicle (EV) market, have plummeted 77.7% year-on-year to 11,000 units in February, according to data released by the China Passenger Car Association (CPCA) on Monday. This also represents a 70% decrease compared with NEV sales in January.
The CPCA adjusted its prediction for Chinese auto sales in 2020 from a 1% increase to a drop of 8%. This is if the national authorities will not implement any strong stimulus policy in this sector in the coming months, the association said in the report.
The latest figures mark the eighth consecutive month of decline after authorities announced last June 2019 reductions in subsidies of about 50% for NEVs, including EVs and other cars powered by renewable energy like hydrogen fuel and electric hybrids.
The country’s overall auto sales also went down 78% year-on-year to 252,000 units in February, from over 1.17 million units sold in the same month last year.
The association attributed the sales decline to the impact of the coronavirus outbreak in China. While NEV makers struggle to resume full production due to supply chain disruption, people are also reluctant to use ride-hailing services under, an industry that normally purchases a large number of NEVs. About 60% of NEV purchases in China before the coronavirus were for ride-hailing, said the association.
Chinese EV makers have already borne the brunt of the outbreak. Shenzen-based BYD sold 2,803 units in February, only one-fifth compared to the February 2019 figure of 14,429. Beijing-based EV maker BJEV, a unit of Chinese state-owned company BAIC, also saw its February sales slump 59% year-on-year to 1,002 units.
However, some players still see opportunities amid headwinds. US-based EV firm Tesla has delivered 3,958 units in February, accounting for about 30% of all NEV deliveries in the country, according to CPCA’s secretary general, Cui Dongshu. Comparative Tesla figures were not available.
Tesla’s Shanghai Gigafactory has resumed production since Feb. 10, after the facility was forced to close down temporarily by the Shanghai government.