In 2021, the global electric vehicle market will grow by 40%, with total sales exceeding 3 million units. As of 2019, more than 2 million electric vehicles have been sold worldwide, accounting for 2.5% of all vehicle sales. It is estimated that the compound annual growth rate of global electric vehicles in the next ten years will reach 29%; the total sales of electric vehicles It will increase from 2.5 million in 2020 to 11.2 million in 2025 and 31.1 million in 2030.
The industry that receives the most attention in early 2021 is the electric vehicle industry. In addition to Tesla’s sales of almost 500,000 vehicles, major automakers in various countries are also sprinting for development. In the post-epidemic era, electric vehicles are developing rapidly and even the technology industry is not allowed. The reason for the non-entry development trend is that the electric vehicle industry has strong kinetic energy, which drives the innovation of the automobile industry and promotes the manufacturing transformation of related industries.
Tesla has changed with technology to challenge the automotive market and disrupted the original solidified industrial landscape. In a flash, automatic driving, software updates, touch panels, and artificial intelligence have become standard equipment for almost every car; China manufacturers are betting resources and expect to join the battle. Japan and Korea brands are making every effort to develop the Hydrogen fuel cell, and European and American automakers are striving to reduce carbon to meet the standards. In such a highly competitive market, even Apple expects to redefine "cars."
Why is the whole world paying attention to and investing in the electric vehicle market?
Looking at the auto market in 2020, we can see that, looking at the major brands last year, the annual auto market sales fell below 80 million units. Volkswagen and Toyota both declined by about 15% throughout the year. In the automotive economic depression, only electric vehicles bucked the trend. growing up.
In 2019, the global sales of electric vehicles totaled about 2 million. Under the influence of the epidemic in 2020, it will still grow to 2.4 million. Among them, Tesla has increased its market value by 7 times, becoming the world's most valuable car manufacturer.
In 2021, the auto market will gradually recover in the post-epidemic era, with annual sales reaching 83.5 million units, and new energy vehicles including plug-in hybrid electric vehicles (PHEV) and battery-only vehicles (BEV) are expected to accelerate to 3.4 million, the growth rate is about 40%.
More important than sales compliance: production capacity compliance
For Tesla, the most difficult thing is not to sell the car, but to build the car. Tesla has almost completed its goal of 500,000 sales in 2020, which has doubled compared to 2018. The biggest executive force behind it is the super factory in Shanghai, China.
Since the Shanghai plant was officially started at the end of 2019, the production capacity has continued to maintain a high level. In 2020, 137,000 models of Model 3 made in China were sold. If the export to Europe is counted, it can be said that Giga Shanghai produced 150,000 vehicles throughout the year, which is close to 30% of Tesla's annual production capacity.
With the completion of the Shanghai Super Factory expansion project in 2021, Tesla China’s production target has been directly raised to 550,000. According to the survey, the Shanghai plant will currently produce 5,000 Model 3 and 3,000 Model Y vehicles per week. Fully sprint towards the annual goal.
Tesla's current sales situation is to sell one if you make one. In fact, other automakers are also facing a similar situation, because the production capacity of electric vehicles is insufficient to meet market demand. Two key components limit the production capacity of electric vehicles batteries and chips.
Panasonic is Tesla’s main component supplier, has increased its battery production capacity from 24 GWh to 39 GWh in 2020. LG Chem, the main battery supplier of the Chinese plant, is also expanding its product line and is expected to be able to provide 320,000 Tesla electric vehicles. This is almost 500,000 batteries needed by the Shanghai plant in 2021. This is only a Tesla manufacturer. The world’s three major battery suppliers, Ningde Times, LG Chem, and Panasonic, together provide 70% of the world’s electric vehicle batteries. With Tesla’s sales skyrocketing, other automakers must do their best. If you can't grab the battery, you can only wait for manufacturing. Today, not only Tesla wants to make its own batteries, but GM, Ford, and Toyota are all considering making their own batteries to solve the problem of battery shortage.
The second part that restricts production capacity is automotive IC chips. This seemingly tiny part is indeed very important. It needs to be used no matter whether electric or fuel vehicles. Compared with the whole vehicle, its cost is low. However, if the supply is insufficient, the assembly will be required. Can only be shut down. The shortage of goods since the end of 2020 has already affected the shipment of fuel vehicles. The number of chips used in electric vehicles is several times that of fuel vehicles. At present, car manufacturers can only wait for the shortage of goods to ease.
The number one driver of electric vehicle sales: policy
Why will major automakers push electric vehicles under the epidemic in 2020? The answer is simple, there will be a fine for not selling. In 2020, the EU promulgated carbon emission standards. According to regulations, the average carbon emissions of car factories need to drop from 130 grams per kilometer in 2019 to 95 grams per kilometer. Those who fail to meet the standard will have one gram exceeding the standard. The number of vehicles, each with a fine of 95 Euros.
At the same time, many European countries also provide subsidies for people who buy electric vehicles, including tax cuts and car purchase rewards, ranging from 3,000 euros to 9,000 euros. European countries have also provided large budgets to expand public charging facilities, improve infrastructure, and lower the threshold for people to exchange for electric vehicles.
With the addition of these three factors, the European market will sell more than 500,000 electric vehicles in 2020. Benz’s EQC and Porsche Taycan have achieved more than 20,000 vehicles. Volkswagen’s newly launched ID.3 even directly surpasses Tesla to become European electric vehicles. The car sales champion, calculated based on the estimated sales volume proposed by various factories, there will be a chance to sell 750,000 pure electric cars in Europe in 2021.
The world’s largest electric vehicle market is still China. In 2020, 1 million Pure Electric Vehicles and approximately 240,000 Plug-in Hybrid Electric Vehicles have been sold in the Chinese market. Among them, Tesla Model 3 has been successfully sold annually under the continuous price reduction strategy. 137,000 vehicles reached the top. The second place is the short-range electric car SAIC-GM-Wuling Automobile Mini EV, and the third place is the GreatWall electric car Ora R1. It is worth noting that BYD Auto, although not ranked in the top three models, the combined sales of all pure electric models under the group is about 130,000, which is a 17% decline compared to 2019. It is still the first class in terms of brand. Including plug-in hybrid vehicles and commercial vehicles, BYD is still a core competitor in the electric vehicle industry.
The China market experienced a low tide of subsidy withdrawal in 2019. Now they have extended the new energy vehicle subsidy policy to the end of 2022. Together with the introduction of cash car subsidies and other programs in various provinces, it is generally expected that China's electric vehicles will also grow by about 40% in 2021. Under the strong competition of Tesla's China-made Model Y, although the space for Chinese independent brands will be compressed, the growth space of small cars will be much better than that of SUVs.
The U.S. Green Energy and Electric Vehicle Market is Optimistic
Although Tesla is from the United States, in the past few years, the Federal Government of the United States and the California government have been unable to reach a consensus on air pollution and carbon emissions. With the new U.S. President Jor Baiden taking office and the Democratic Party, which is generally believed to be more supportive of green energy, taking power, it is generally estimated that the U.S. electric vehicle market will enter a period of rapid growth in the next five years.
The latest automotive market report pointed out that the U.S. market in 2021 will have similar changes to the European market in 2020. One of the main reasons for this is that Jor Baiden may introduce stricter carbon emission regulations, which may drive the US plug-in hybrid vehicles and the European market. The growth of pure electric cars.
In the past, former U.S. President Donald John Trump relaxed carbon emission standards a lot. Although Jor Baiden may push for stricter standards after taking office, considering the current state of the industry, 2022 will be the deadline for the transformation of U.S. automakers, because most automakers the greenhouse gas (GHG) emission quota will expire at the end of 2021, which will be a huge test for car manufacturers that have not seriously reduced their carbon in the past two years.
Based on the current sales volume and carbon emissions of major automakers in the U.S. market, it is estimated that automakers may generate a carbon tax of up to 2 billion U.S. dollars in 2022. If the United States returns to the Barack Obama era carbon emission standards in 2025, it may be generated by then. The carbon tax will be 7 billion U.S. dollars. If the automakers fail to meet the standards, the money will either fall into the hands of the Federal Government of the United States or into Tesla's pockets.
It is worth noting that the calculation method of the US carbon emission standard is not like the EU and China based on vehicle weight. The US uses Foot Print (four-wheel area as the standard) to calculate carbon emissions, which is important for pickup trucks and trucks. Cars are more disadvantaged, which can also explain why GM and Ford’s first targets for electrification are RVs and pickup trucks.
In 2020, the sales volume of electric vehicles in the United States is approximately 350,000. In 2021, with the successive delivery of new electric vehicles from major manufacturers, sales are expected to reach 500,000.