Can auto companies rely on subsidiaries? Half-year sales volume of alternative energy vehicles has not reached 1/4 target

Alternative energy vehicles now also face sales trouble. According to data published by China Association of Automobile Manufacturers (CAAM), alternative energy vehicles have a sales volume of 170,000 units in the first half of year across the nation, increasing 126.9%. Despite of the high growth, the sales volume has great distance with the annual 700,000 units’ target.

Currently, the biggest sellers in alternative energy vehicle market are still BYD, SAIC Passenger Vehicle, BAIC BJEV, JAC and other auto giants. However, data shows they also encounter great challenges in the market this year.

CPCA’s statistical data shows Qin, BYD’s mainstream product, only sells 9,404 units in the first half of year, decreasing 42.9% with the same period of last year. BYD’s current best-seller products are Tang and Song, selling 19,000 and 28,000 units respectively. Resulted by the decreasing local subsidiaries, BYD’s sales volume decreases greatly this year. To save the declining sales, BYD provided a cooperated price subsidiary of RMB 14,000 with its dealerships in June. However, with the oncoming 40,000 units’ sales volume and subsequent halving price subsidiary, BYD will face a great challenge to keep the price.

JAC also adopts a discount to save the sales volume. It’s learned that JAC provides subsidiaries of RMB 15,000 for each alternative energy vehicle just days ago. However, data shows JAC’s sales volume is only 2/5 of the same period of last year. It seems inevitable for alternative energy vehicles to face a sales drop when subsidiaries are decreasing.

Data shows that the production and sales volume of alternative energy vehicles are 45,000 and 44,000 units in June, increasing 107.4% and 107.3% respectively. Sales volume of BEV reaches 34,000 units, increasing 126.6%. Resulted by government subsidiaries, sales volume of BEV passenger vehicles accounts for 47.7% of the total sales from January to June, higher than PHEV. The oncoming subsidiary drop forces alternative energy vehicle companies to transform to a product-driven model and seize the SUV market. Although the sales volume is less than 1/4 target, Yao Jie, Deputy Secretary of CAAM said that the target will stay unchanged. Because sales volume in Q4 is higher than the three quarters, it’s still possible that annual target will be achieved this year.