Vehicle sales in China are expected to grow 3% to 27.66 million units this year following a hard-won 2.1% growth in 2022. Automakers delivered 26.86 million vehicles in 2022, despite months-long production disruptions across the country caused by semiconductor shortages and the Covid-19 pandemic, said the China Association of Automobile Manufacturers (CAAM). The growth reflected strong market demand as well as favorable and timely policies rolled out by the government, said Chen Shihua, Deputy Secretary General of CAAM. The halved purchase tax, implemented from June to December, was estimated to have increased passenger vehicle sales last year by at least 1.45 million units, according to the China Passenger Car Association (CPCA). New energy vehicles (NEVs) saw “explosive” growth last year. A total of 6.89 million electric cars and plug-in hybrids were sold in 2022, up 93% year-on-year. They accounted for a quarter of total vehicle sales for the year.
The surging popularity of NEVs saw China’s BYD overtake FAW-Volkswagen as the best-selling carmaker in China in 2022, with 1.86 million vehicles sold during the period, up 149% year-on-year. Chen said as both the macro-economy and consumer confidence will take a turn for the better this year, vehicle sales will grow accordingly in the country. Major carmakers share such optimism, especially with regard to NEVs. Great Wall Motors, China’s largest SUV maker, expects to sell 1.6 million units this year, up from 1.06 million sold last year. It will launch 10 new NEV models this year. Volkswagen saw its China sales dip last year, but sales of its electric ID Series more than doubled. Ralf Brandstaetter, Chairman and CEO of Volkswagen Group China, estimates that one in three new passenger vehicles sold in China will be an NEV in 2023, up from one in four in 2022. “No other markets have seen such rapid NEV growth,” Brandstaetter said, adding that the company is speeding up efforts to introduce new models to China this year, including the ID.7 sedan showcased earlier this month at the Consumer Electronics Show (CES) in Las Vega. By 2030, up to 40% of the group’s models in China will be electrified, and it will invest up to €14 billion in e-mobility with its Chinese joint ventures by 2024, he added.
Paul Gong, Automotive Analyst at UBS, expects passenger NEV sales in China will reach 8.8 million units in 2023, accounting for 38% of total passenger vehicle sales. He said China’s NEV exports will further grow in 2023 as well. Last year, carmakers in China exported 3.11 million vehicles, up 54% from 2021, of which 679,000 units were NEVs, the China Daily reports.
