China’s top EV trio suffer sales setback in July as heatwave deters consumers but new models inspire second-half confidence

  • Shanghai-based Nio said it delivered 10,052 units in July, down 22 per cent from a month earlier
  • Chinese smart EV start-ups are all ramping up development of new models to tap the accelerated pace of electrification in China

China‘s top three home-grown smart electric vehicle (EV) makers hit a stumbling block with sales growth in July as a heatwave across the country deterred consumers from visiting showrooms.

All three companies, regarded as China’s best response to US EV maker Tesla and who enjoyed a strong May and June, reported July sales declines on Monday.

Shanghai-based Nio said it delivered 10,052 units in July, down 22 per cent from a month earlier. Beijing-headquartered Li Auto posted a 20 per cent month-on-month drop in sales, delivering 10,422 vehicles in July.

Meanwhile Guangzhou-based XPeng’s deliveries plunged 24.7 per cent to 11,524 units in July from June.

However, some analysts played down the dip, looking ahead to new model launches in the second half.

“July is normally a low season for car sales,” said the founder of Shanghai-based technology portal CnEVpost.

“Overall, demand for their intelligent battery-powered vehicles remains strong. Many customers, who refused to go shopping last month due to high temperatures, are expected to conduct their purchases [of EVs] in the coming one or two months.”

According to preliminary estimates by the China Passenger Car Association (CPCA), sales of new-energy vehicles (NEVs) – which comprise pure electric, plug-in hybrid and fuel-cell cars – across the mainland could have fallen 15 per cent in July from June to 450,000 units.

However, Nio’s delivery number in July represented a 26.7 per cent rise from the same month a year ago; Li Auto reported a year-on-year increase of 21.3 per cent while XPeng’s July deliveries jumped 43.3 per cent year-on-year.

Tesla, the runaway frontrunner in the mainland premium EV segment, typically does not publish monthly sales data for its China operations. In June, the global EV leader delivered 77,938 Model 3 and Model Y vehicles to mainland customers, after its Shanghai Gigafactory restored production to a level on par with March.

The Shanghai plant lost about 50,000 units in production between March 28 and April 18 when it halted operations amid a Covid-19 outbreak. Its total loss could amount to 70,000 units amid knock-on effects for Tesla’s supply chain.

Kevin Shen, co-founder and president of Li Auto, said in a statement on Monday that the new model L9, a full-size luxury SUV, had accumulated more than 50,000 orders since it started presales on June 21. The vehicle, priced at 459,800 yuan (US$68,087), can go as far as 1,315km (817 miles) on a single charge.

Meanwhile, Nio’s ET5 sedan – which is priced from 328,000 yuan – is expected to hit the market in September. XPeng will start selling its new model G9, an SUV equipped with a semi-autonomous driving system, in the coming weeks.

The Chinese smart EV start-ups are all ramping up development of new models to tap the accelerated pace of electrification on mainland China roads. All of their vehicles feature preliminary autonomous driving technology, sophisticated in-car entertainment systems and high-performance batteries.

Tesla is not expected to launch any new models this year as it focuses resources on overcoming ongoing supply chain disruptions.

Author: Cheryl Heng, SCMP

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