No imaginary golden nine and silver ten, and may not usher in the remarkable tail effect of previous years, several years of rapid rise in new energy vehicle sales in 2019 and even the risk of negative growth. According to the China Association of Automobile Manufacturers, from January to November 2019, China's new energy vehicle production and sales were 1,093,000 and 1,043,000 respectively, with year-on-year increases of only 3.6% and 1.3%. And November's sales have not exceeded 100,000 units, a year-on-year drop of more than 40%, has been five consecutive months of year-on-year decline. If December still can't stop the trend, the annual sales negative growth is a foregone conclusion.July has become a watershed. 2019 first half, the domestic new energy vehicles still maintain rapid growth, June sales rose even once more than 80%.July began the situation turned sharply downward, the year-on-year rate of decline gradually expanding from 3.8%, 21.7%, 34.8% to October has been a trend of the waist cut to 46.0%, only slightly narrowed in November (see charts 1 and 2). Since 2010, when new energy vehicles were listed as a national strategic emerging industry, sales have been almost all the way up, and even if the domestic auto industry has entered an era of micro-growth in recent years, and even ushered in the first decline in new car sales in the then 28 years in 2018, new energy vehicles have also been a splash of color in the relatively sluggish overall auto market. Why will it appear unprecedented "five consecutive declines" in 2019? What factors have shaped the current market situation? How is the market pattern changing? What other highlights are worth paying attention to?

"Hang on, hold on tight, the second half of the year is afraid that there are no such days." In the middle of 2019, the reporter interviewed a domestic well-known new energy vehicle brand 4S store in charge, he was busy for several days, pointing to a pile of information sheet on the computer and said to the reporter, "These, and these cars, are all processed in the past few days, this is what has been sold." After the busy will not say more. And by the end of the year, when the reporter came to the store again, there are no customers in the store, the reporter was told that the person in charge has left the store, and the store only staff, it seems that there is no end of the year busy state, "This year is almost like this, we do not intend to enter the car again."

In 2019, the domestic new energy vehicle market first "fire" after "ice", after entering the second half of the "five consecutive decline" has become the focus of attention of the entire industry. The performance of this 4S store is just an incomplete epitome.

"The core reason for the decline in sales of new energy vehicles is the impact of market-based decoupling, resulting in the entire market demand in a weak state." Cui Dongshu, secretary-general of the Passenger Vehicle Market Information Association, said that the current state of this downward spiral is a serious challenge for us, we previously underestimated the impact of the subsidy decline to bring such a serious impact, that the decline is just a little bit of the end.

Specific analysis, the current situation of the new energy vehicle market is affected by a combination of factors.

The first is the superimposed effect of the effectiveness of multiple policies.

1. The number one policy factor when the national subsidy rate is unprecedented, while the local turn to subsidize infrastructure.

Xu Changming, deputy director of the National Information Center and senior economist, has judged that new energy vehicle sales in 2019 may not reach the 2018 level. Over the past five years driven by policy, the domestic new energy automobile industry is in a unilateral and sustained high-speed growth stage. And with the substantial retreat of subsidies, new energy vehicles will enter a fluctuating development stage.

On March 26, 2019, the four ministries and commissions jointly issued the Notice on Further Improving the Financial Subsidy Policy for the Promotion and Application of New Energy Vehicles (hereinafter referred to as the Notice), which clarified the new round of new energy vehicle subsidy standards. From a general perspective, the 2019 new policy on subsidies continues to increase the regression on the basis of 2018, with an average regression of about 50% for major models, and eliminates local subsidies for the sale of vehicles in favor of subsidies for charging, hydrogen refueling and other infrastructure. For example, the staggered subsidies for pure electric passenger cars by mileage range were simplified from five grades in 2018 to two grades, with the overall regression averaging 50%, and no more subsidies for models with a range of less than 250 kilometers. The subsidy ceiling for new energy buses has also been reduced by more than half, and the fast-charging class of pure electric buses with the largest regression rate has been reduced from 2100/kW-h to 900kW-h. The subsidy for new energy special-purpose vehicles is even more in the case of a 40% reduction in 2018, and the regression rate in 2019 still reaches 46%-59%.

In addition, the 2019 subsidy regression, although also set aside a transition time for the enterprise, but from four months in 2018 has been shortened to three months, with two cut-off points of March 25 and June 25 will be the whole year's subsidy standard truncated into three segments, a purely electric passenger car to enjoy the subsidy amount in the first cut-off point before and after the difference of 30,000 yuan ranging in the second cut-off point before and after the difference of 20,000 yuan or so.

So, in order to seize the last policy dividend of the transition period, many car companies began to frantically discount promotions to clear inventory, and many consumers' demand for car purchases in just two or three months to focus on the release of the car ahead of time, *** with the same to promote the new energy vehicle sales in June jumped eighty percent year-on-year, but also to the second half of the market to bring great pressure.

China Association of Automobile Manufacturers, assistant secretary general Xu Haidong has said that although many car companies state that after the landing of the new subsidies, will not let the interests of consumers suffer. But in fact, after the implementation of the new policy, many models landing price increase, resulting in many potential buyers wait and see. The release of the new policy on subsidies has also raised the purchase threshold.

In accordance with the previously planned national emissions standards upgrade schedule, from July 1, 2019, the country began to formally implement the country's sixth stage of the new emissions regulations, that is, from July 1 onwards, the national five emissions standards of new cars to stop licensing registration. Some cities have even taken the measure of early implementation.

But data from the 2018 Auto Dealer Survival Survey, published by the China Automobile Dealers Association in late April 2019, shows that new car sales by dealers in 2018 were almost unprofitable, and inventory warnings remained high for 17 consecutive months, with "National 5" models in serious inventory pressure. For dealers, significant price cuts and promotions become the inevitable choice to quickly clean up the inventory of cars, the market in May and June even appeared in the "buy one get one free" discount method.

This kind of price cuts to a certain extent also affects the choice of many consumers to buy a car, that is, from the intention to buy a new energy car to buy a super low price of the National Five traditional fuel cars. And some consumers are even more confused in the face of this situation, continue to wait and see.

"New energy vehicles are in fact also subject to the National Six standard, many companies are subject to the impact of the National Six standard, resulting in traditional products can not keep up, the old products and must be cleared out of the warehouse, suffered huge losses." Cui Dongshu believes that the implementation of the National VI standard has promoted the process of rapid clearance of the industry, some joint ventures, especially many independent brand car enterprises have been seriously affected. Plug-in hybrid models saw a 44 percent year-on-year decline in October, also due to the subsequent impact of this policy.

3. The third policy factor is related to the ongoing implementation of the "double points" policy. Some industry experts have pointed out that the "double-points" policy currently being implemented has failed to deliver the huge "power" that was expected.

Released in September 2017, the "average fuel consumption of passenger car companies and new energy vehicle points parallel management approach" ("double points" policy), the industry as a subsidy to encourage car companies to continue to produce new energy vehicles after the exit of the gear policy, intended to promote the market promotion of new energy vehicles through the points trading. The policy on the annual production or import volume of 30,000 or more enterprises put forward a clear proportion of new energy vehicle points requirements: 2019, 2020, the proportion of new energy vehicle points requirements for 10%, 12% respectively. Xu Changming has said that how new energy vehicles fluctuate in the future depends on the role played by the double integral policy. If it is not strictly enforced, the future development of the new energy vehicle market will be full of questions.

From the current point of view, although the "double points" policy has begun to show the role of promoting, but whether it is the current performance of the points trading price, or in forcing car companies to increase investment in new energy vehicle products, to promote the expansion of market share, some experts in the industry believe that a little insufficient.

In 2018, the double points policy has been implemented to promote the development of new energy vehicles. New energy vehicle double points trading amounted to more than 700 million yuan, only 850 yuan per point, is expected to rise to more than 2,000 yuan by the end of 2019.

Chen Qingtai, chairman of the China Electric Vehicle Association, clearly pointed out that "the efficiency of the current 'double points' policy is not high, and we should study the adjustment of the implementation program of the 'double points' policy, through the 'double integral' policy to guarantee the realization of the goal of increasing the proportion of electric vehicles year by year."

2019 is the first year of the implementation of the "double points" policy, the Ministry of Industry and Information Technology has been adjusted twice, and come up with a draft for public comment to the community. At present, the "double points" policy is still in the process of adjustment and improvement. It is understood that this revision is intended to guide the diversified development of energy-saving vehicles, new energy points to car companies to assess and source requirements to provide a more relaxed environment, in order to play a good role in guiding the development of the industry.

Secondly, from the perspective of the consumer market, there are three main factors affecting consumers' purchasing power and confidence in 2019.

1. The continued downturn in the macro economy in recent years has affected the entire domestic auto market.

Some domestic economists have pointed out that for industries such as automobiles, one of the severe situations currently faced is that domestic consumption has been severely squeezed, and residents' household assets and liabilities are in serious trouble, which has dealt a blow to residents' consumer confidence and ability. Under the superimposed influence of the substantial regression of vehicle purchase subsidies, it has been difficult for the new energy vehicle market in 2019 to stand alone as in previous years. Zhao Xinzhi, director of the market research department of the Product and Business Model Innovation Center of the BAIC Group Marketing Business Committee, also analyzed that because many families are second-car users, the lack of purchasing power is caused by the decline in the income level and consumption ability of the middle- and low-income groups.

2. From the second half of 2018 to 2019, frequent safety incidents such as fires in new energy vehicles have also dampened the purchasing confidence of ordinary consumers to a certain extent.

The "New Energy Vehicle National Supervision Platform Big Data Safety Supervision Achievement Report" released by the New Energy Vehicle National Big Data Alliance shows that from May to August, the New Energy Vehicle National Supervision Platform*** has found 79 safety incidents involving 96 vehicles. Among the vehicles with identified causes of fire, 41% were in traveling state, 40% were in a stationary state, and 19% were in a charging state. It is particularly noteworthy that the vast majority of the accident vehicles using ternary lithium batteries, accounting for 86%.

The national new energy vehicle subsidy policy in the past three years has continued to improve the requirements for range and energy density, with rapid upgrades on a yearly basis. In order to achieve the standard of subsidies, car companies mostly adopt high energy density battery, but the verification work is seriously insufficient. At present, the range of products in the domestic new energy automobile market has been greatly improved, but the safety hazards brought about by it have also gradually appeared.

Data from the State Administration of Market Supervision and Administration shows that 33,281 new energy vehicles have been required to be recalled. It is also understood that nearly 20% of the vehicles were recalled due to power battery problems.

3. At present, new energy vehicles, especially pure electric models of the value of the situation is worrisome, and the value of the rate is precisely one of the factors that consumers focus on when buying a car.

The 2019 China Auto Value Retention Report released by the China Automotive Finance and Value Retention Research Committee shows that the value retention rate of most Chinese branded new energy vehicles on the market for one year is already lower than 50%, and those with a range of 300 kilometers or less are only 20% or 30%. Even for the best-performing Tesla Model?X, the 1-year warranty rate is only 67.46%, followed by the Tesla Model?S and Azera ES8, whose warranty rates are 65.32% and 51.28% respectively.

"There is a more important reason for the decline in sales of new energy vehicles, which is the low residual value and the need for professionals to assess the use of their power batteries before pricing. Even if the battery use condition is still OK, but the used car buyers do not recognize, the price of new energy used cars can not be raised." Cui Dongshu said that the direct consequence of this situation is that dealers are not good out of the recycling of the price will be very low, the owner does not accept the private transaction, the used car market and the circulation of new energy used cars are very unfavorable.

The above three factors, coupled with policy changes and uncertainty, have caused more consumers to pause in their purchasing plans and remain in a state of observation and wait-and-see.

Third, from the supply side, some domestic new-energy vehicle companies have weakened their production momentum, reducing the supply of products to the market.

The head of sales at a domestic OEM even said, "In terms of the cost of a single vehicle, it is currently selling one at a loss, and some have temporarily stopped selling." Before March 25, 2019, some pure electric passenger car single car subsidy can get 75,000 yuan, by June 26 has been reduced to 45,000 yuan, after which it continues to drop to 25,000 yuan. Cui Dongshu analysis pointed out that this adjustment period to the huge pressure on enterprises is unbearable, but also led to the current difficult predicament.

According to Zhao Xinzhi, the subsidy for new energy passenger cars has been regressed by 60%-80% relative to 2018. This has increased the cost pressure on enterprises, so they must limit production and raise prices for low-priced cars.

Evolution of the market pattern: the share of traditional autonomous vehicle enterprises fell below 90%

After several years of development, the domestic new energy vehicle market is breaking the original situation, and the market share and power ratio of each participant and various products are in the midst of change.

In the battle of independent brands and joint venture brands, foreign brands, the traditional independent automobile enterprises in the new energy vehicle market absolute advantage is being impacted.

"2019 could be the first year in recent years when the share of traditional independent brand models is below 90 percent." Recently, Li Jinyong, 2019 president of the All-China Federation of Industry and Commerce Automobile Dealers' Chamber of Commerce and chairman of Zhonghai Tongchuang Group, said at the 2019 China Car Dealers' Summit Forum that domestic joint venture brands of purely electric models have gradually entered the market, and the products of the new forces of car-making accounted for 9% of the total, and have gradually become an important participating force in the market.

Between 2010 and 2015, the domestic new energy vehicle market was almost the world of traditional autonomous vehicle enterprises. But since 2016, multinational automotive giants have significantly accelerated the pace of transition to electrification, and the planning efforts to launch new energy vehicle products into the Chinese market have also increased significantly.

Huang Yonghe, director and chief engineer of the Intelligence Institute of the China Automotive Technology Research Center, observed that from 2013 to 2015, although many joint ventures, including multinationals, released their development strategies on new energy vehicles, the number of models on the market was still relatively small. However, starting from 2018, there has been a significant increase in the number of joint venture brand new energy models on the market. from January to October 2019, the proportion of joint venture brand products has exceeded 10%. He is concerned that, according to market research, in the consciousness of many "post-80s" and "post-90s" young people, Tesla and BBA have been listed as luxury car brands, which may affect the entire new energy vehicle market, especially for the younger generation segment. market. "It should have a bigger impact on our market."

Looking at the various segments, plug-in hybrid sales have declined more than 40 percent year-on-year through November 2019. And in the pure electric passenger car market, the decline was especially pronounced in the A0 and A00 classes.

These two models have been the mainstay of pure electric passenger car sales in recent years. In 2017, the total sales of A0 and A00 class models once accounted for more than 70% of the market share of pure electric passenger cars, however, they began to contract in 2018, especially the market share of A00 class products was nearly 20 percentage points less.In 2019, the market share decline of A00 class models has expanded, and now accounts for less than 30%. It is worth noting that in 2019, the share of A-class pure electric passenger cars increased significantly, and has occupied half of the current pure electric passenger car sales.

Industry experts analyzed that the evolution of this market pattern is precisely the result of the continuous adjustment of the national subsidy policy in the past three years. Cui Dongshu pointed out that another factor is that a number of time-share leasing enterprises fell, their products were a large number of returned to the lease and flow to the market, a large number of low-priced disposal.A00-class electric vehicles have been the main operating vehicles of time-share leasing scenarios, "so there is huge pressure on the growth of the A00-class vehicles, the market performance of the market is sluggish."

Imported cars, travel market contracted annual highlights

Despite the decline of the overall market for new energy vehicles, there is still no shortage of bright spots in some segments.

The first is the rapid growth in imports of new-energy models, which has become a bright spot in the imported car market.

Statistics show that from January to October 2019, the total import volume of new energy vehicles was about 49,000 units, up 191.7% year-on-year. Among them, Tesla's total import volume was about 33,300 units, up 184.1% year-on-year, becoming the main brand in the imported new energy vehicle market.

The second is the travel market, especially the cab and online car market, but whether this market performance can be called a bright spot is a matter of considerable debate in the industry.

Wang Yongqing, general manager of SAIC-GM, once revealed at the 2019 Guangzhou Auto Show that from January to September 2019, only more than 100,000 electric vehicles were sold to private users across the country, and the rest of the more than 700,000 were all put into the B-side travel market. Many industry players have expressed their doubts and concerns about the development of the new energy vehicle industry after seeing this information, and they believe that this does not reflect the real demand of private users, and they are more pessimistic about the market prospects of new energy vehicles. The January-October new energy vehicle licensing data shows that more than half of the pure electric passenger cars are operating vehicles and non-operating vehicles purchased by the unit.

The travel market, especially online cab and cab, has become a major channel for digesting new energy vehicle products. From another perspective, this is not a bright spot in the development of the new energy vehicle market. Cui Dongshu revealed that the current new energy vehicle ownership included in the scope of monitoring is about 2.01 million or so, of which cabs, net car, official leasing vehicles accounted for 47 percent, while private vehicles accounted for 53 percent.

From the point of view of the mileage of operation, the mileage of operation of the vehicles used for net-journey cars and cabs accounted for about 60 percent and 55 percent. "The good development trend of the net car market has led to a significant increase in the sales of new energy vehicles, the current penetration rate of new energy vehicles in the net car market reached more than 10%, while cabs reached about 6%, the main models include BAIC EU series, Dihao EV series, BYD e5, e6, etc., net cars, cabs are the real promotion of new energy vehicles live business cards ."

So, Cui Dongshu analysis pointed out that the new energy vehicles are mainly sold to travel companies should be a bright spot rather than a problem. Because this just shows that the travel market to the acceptance of new energy automobile products, especially the operation of the user's recognition of its electric consumption than fuel consumption, if the net car operation and did not reach a reasonable business situation, the user is absolutely not willing to use. This would have been the highlight of the development of new energy vehicles.

Currently, new entrants to the network car must be pure electric models have become more and more cities to choose. In terms of driver income, the new energy online car has begun to take advantage of the first and second-tier cities. The massive use of new energy vehicles in the online car market should be seen as one of the more successful cases so far.

Expert view: 2020 new energy vehicle market prediction

New energy vehicle sales will not improve significantly in 2020

Xu Haidong, assistant secretary-general of the China Association of Automobile Manufacturers (CAAM)

In the last month of 2019, the sales of new energy vehicles may show signs of tailing off due to multiple factors, but even if there is a year-end a small uptick in sales, it will not be able to directly drive a significant increase in sales of new energy vehicles for the whole year. In the second half of the new energy vehicle market, the "five consecutive declines" will allow the government, car companies, consumers and other parties to re-examine the new energy vehicle market. It is expected that the government will launch more favorable policies for the development and sales of new energy vehicles, car companies will also be adjusted according to the market production rhythm and product layout, and consumers will be more rational. Therefore, after 2020, the sales of new energy vehicles will not have much improvement, will still be in a period of adjustment.

China's new energy vehicle market will see a positive growth of 26% in 2020

Cui Dongshu, secretary-general of the Passenger Vehicle Market Information Association (PVMIA)

The challenging target for new energy vehicle sales in 2020 is expected to be 2 million, with a neutral judgment of about 1.6 million. According to the Ministry of Industry and Information Technology's "New Energy Automobile Industry Development Plan (2021-2035)" solicitation draft of the target of 25% of new energy vehicle sales in 2025, it is expected that new energy vehicle sales in 2025 will reach more than 7 million units. Based on the sales of nearly 1.3 million units in 2019, the compound growth rate from 2020 to 2025 will be more than 33%. The new energy vehicle sales of new vehicles accounted for about 25% of the target is a great leader for enterprises, which will push them to accelerate the development of new energy vehicles.

It is expected that domestic sales of new energy vehicles will reach 1.8-2 million units in 2020

Li Jinyong, 2019 president of the All-China Federation of Industry and Commerce Automobile Dealers' Chamber of Commerce

2020 will be the starting year for the marketization of new energy vehicles. The B-side market will continue to firm up in the future, and the electrification of cabs and online cars will become an inevitable trend. The market of purchase-restricted cities is expected to see an incremental increase in new energy vehicles (40,000-100,000 additional vehicles in Beijing). In the future, as the value of points increases and the cost of batteries decreases, the market for A00-class pure electric passenger cars will pick up, and sales in non-restricted cities will increase. With Tesla's domestic production and the listing of some of the new car-making power models, promoting the expansion of high-end users of new energy vehicles is expected to increase by more than 100,000 units. 2020, as the last feast of the new energy vehicle subsidies, the last end of the year effect is visible, and it is expected to increase sales by 200,000 units.

2020 is still a period of adjustment, to achieve micro-growth

Beijing Automobile Group marketing business committee product and business model innovation center market research department director Zhao Xinzhi

2019 and 2020 is the market adjustment period, is expected to new energy vehicle sales in 2019 at about 1.1 million units, of which 800,000 units of pure electric vehicles. Next year is expected to grow slightly, pure electric vehicles about 6% increase to 850,000 units. The market will enter a growth period in the future, with a growth rate of about 17%-20% in 2021-2023. By 2023 and beyond it is expected to reach more than 2 million units.

This article comes from the authors of the Automotive House Car Family, and does not represent the viewpoint position of the Automotive House.