EV Share Of Total China Passenger Vehicle Sales Rises To 18.6% In Q3 As Nio, Volkswagen, Others Take On Tesla
Electric vehicle sales' share of the total passenger vehicle sales in China jumped significantly to 18.6% in the third quarter at a time when a lingering chip shortage hit production and sales of traditional internal combustion vehicles.
What Happened: Electric vehicle share of the total passenger vehicle sales in China rose to 18.6% in the three months ended September, from 13.2% in the second quarter.
As per the rating agency, deliveries of electric vehicles in China nearly tripled in the third quarter.
Wholesale deliveries — vehicles shipped to dealers — of traditional combustion engine vehicles plunged by over 25% in the third quarter on a year-on-year basis. The sharp decline was led by a lingering global microchip supply chain, which was further strained by the COVID-19 pandemic in Malaysia.
The supply bottlenecks weighed on retail sales with dealers’ inventories falling to the lowest since early 2018, the rating agency said.
Why It Matters: China, the world’s largest auto market, is speeding towards electrification. The Chinese government is targeting 20% of all new car sales by 2025 to be new energy vehicles, with electric vehicles making a major contribution.
China is also a hot destination for global automakers including Germany’s Volkswagen Ag (OTC: VWAGY), which is also the largest carmaker in the country.
Electric vehicle leader and market disruptor Tesla Inc (NASDAQ: TSLA) counts China as a key market for growth, despite recent regulatory concerns.
The Elon Musk-led Tesla reported third-quarter sales of $3.11 billion in China in the third quarter, nearly half of where they stood in the United States.
Foreign automakers are also seeing tough competition from homegrown electric-vehicle startups such as Nio Inc (NYSE: NIO),and Xpeng Inc (NYSE: XPEV).
Price Action: Nio shares closed 1.96% lower at $40.47 a share on Tuesday.
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