Category: General

France’s plugin electric vehicle share reached 23.8% in February, up from 20.1% year on year. Full electrics grew share, whilst plugin hybrids remained static. Overall auto volume was 126,237 units, up over 9% YoY. The Dacia Spring was once again the best selling full electric.

 

 

February’s combined plugin result of 23.8% comprised 15.5% full electrics (BEVs), and 8.3% plugin hybrids (PHEVs). These respective shares compare with 20.1%, 11.7%, and 8.4%, year on year. All the growth in share has come from BEVs.

With plugless hybrids (HEVs) also growing share (adding 2.6% YoY), traditional combustion-only powertrains saw their 4th consecutive month at under 50% share of the market (49.0%).

With diesel-only powertrains now standing at 11.7% share, and declining by around 0.5% per month recently, we can expect them to fall to under 10% share sometime over the summer.

 

 

Bestsellers

The bestselling BEV in February was again the Dacia Spring, which has held the top spot for the past three months. The runner up was the Tesla Model Y, and the Peugeot 208 came in third.

 

 

As usual, we only have partial data for BEV models, so we can’t yet detect the arrival of newcomers at low initial delivery volumes.

Of the “newish” models in the top 20, the Renault Megane continues to be strong, in 5th spot, though not as dominant as it was in H2 2022. The MG4 continues to do well, being inside the top 10 for the third consecutive month, in 6th spot.

Let’s now step back to view the three month picture:

 

As usual, we only have partial data for BEV models, so we can’t yet detect the arrival of newcomers at low initial delivery volumes.

Of the “newish” models in the top 20, the Renault Megane continues to be strong, in 5th spot, though not as dominant as it was in H2 2022. The MG4 continues to do well, being inside the top 10 for the third consecutive month, in 6th spot.

Let’s now step back to view the three month picture:

Here, on the strength of its three recent monthly bestseller titles, the Dacia Spring is in the clear lead, a great improvement from its 5th spot over the September-to-November period.

The Spring stands a decent margin ahead of the Tesla Model Y, and Renault Megane.

The Model Y itself has picked up momentum, compared to the prior three month window, when it was in 5th position. The Megane, on the other hand, has dropped two places over the period, from its previous lead.

Here are the main climbers compared to three months prior:

• Dacia Spring up from #5 to #1
• Tesla Model Y up from #4 to #2
• MG4 up from #13 to #7

Here are the models losing rank:

• Renault Megane down from #1 to #3
• Tesla Model 3 down from #2 to #6

Other movements within the top 20 were more subdued.

The Tesla Model Y is now being produced at the rate of around 18,000 units per month at Gigafactory Berlin (and still ramping), all of which will be sold through to the European market. Some additional volume is still arriving from Shanghai.

2022 saw over 138,000 units of the Model Y sold across Europe, by far the best selling BEV in the region. Berlin production will supply perhaps 250,000 units (or more) this year, plus more from Shanghai. This suggests that we could expect a given country’s monthly volumes to approximately double compared to last year — so long as purchasing power can keep up.

Given that waiting times are now just 2 to 4 weeks for some Model Y variants, it may be that Tesla has to tweak the price points a little bit, to balance demand with supply. However, it has plenty of room to do this, and still maintain strong margins.

If supply volumes do indeed roughly double (and assuming the closest competitors in Europe like the VW ID.4 may not be able to quite match this doubling), the Model Y looks unassailable as Europe’s best seller again this year, with an even larger lead than it had in 2022.

As a reminder — this relative strength of a high-price point model (around twice the price of Europe’s historical best selling vehicles) is largely because of continuing relative lack of supply (vis-a-vis demand) of the even more affordable BEVs, like the Renault Megane, and MG4.

In the fullness of time, perhaps years from now, the consumer BEV market will move towards a more classic demand curve, with more affordable vehicles correlating with higher volume, rather than the current anomalous pattern of sales volume distribution, shaped by limited available BEV supply for most models. In the French auto market, the equilibrium demand curve will likely roughly resemble historical patterns, for example with the 2021 median price of €23.2k, plus future inflation. The Nordics support a much higher median (Norway 2021, €34,800), as does Germany (2021 – €33,900) whereas much of southern Europe is lower still (Portugal 2021 – €21,300).

Tesla will of course still be in the mix, with an even more affordable model, which will be available at “Tesla volume”.

 

Outlook

France’s auto market has seen some recent recovery, with 7 consecutive months of YoY growth. Supply chain issues are slowly and steadily being resolved. However, despite these supply-side improvements, if economic sentiment is negative, the demand side may become the constraining factor, and it remains to be seen where the market’s equilibrium volume will sit.

France’s central bank forecast last month that the country will emerge from the winter having escaped a recession, unlike several neighbouring countries. In large part this is because energy prices have stabilised somewhat (though are still much higher than historical levels), helped by France’s majority nuclear electricity generation, which avoids fossil fuel price fluctuations.

Latest forecasts are seeing 0.2% economic growth in Q1 and Q2 — lacklustre, but better than much of Europe. This being the case, the overall auto market may continue its modest YoY recovery trend.

Since plugin vehicles remain competitive from a long term total cost of ownership perspective, we can expect their relative demand (vs. ICE counterparts) to continue to grow. This will result in plugin share growth in 2023, though it’s hard to say how much.

What are your thoughts on France’s auto market, and EV transition? Please jump in to the comments below, and join the discussion.

The post Dacia Spring continues to lead the French EV market first appeared on 🔋PushEVs.

February saw Norway’s plugin electric vehicle share continue to grow to 90.1%, from 86.1% year on year. All the growth came from full electrics, whilst plugin hybrids lost share. Overall auto volume was 7,439 units, down some 9% YoY. The bestselling vehicle was the Tesla Model Y.

 

 

February’s 90.1% overall plugin share comprised 83.1% full electrics (BEVs), and 7.0% plugin hybrids (PHEVs). These shares compare with 86.1%, 75.6%, and 10.5%, YoY.

Overall auto sales recovered to close to seasonal norms in February, from the historic low of January. That low came as a hangover effect of new tax policies active from January 1st, which had pulled-forward a large number of auto sales into November and December.

With the new tax policies further disincentivising combustion-only sales, their combined share in February fell to 4.4%, almost a new record low. Their cumulative share since the policy change sits at 5.5%, and likely will steadily fade to consistently under 5% in the next few months.

The new equilibrium across BEVs, PHEVs, and plugless hybrids (HEVs), remains to be seen in the coming few months. One might hope that PHEVs > HEVs > combustion-only vehicles, and that BEV growth will continue to compress all of the others. Let’s see how it plays out this year — whatever the short term variabilities, the long term trend is abundantly clear, seen in the graph below.

 

 

Best Selling BEVs

Tesla, with the Berlin Gigafactory now cranking out some 18,000 units per month (and still ramping), was able to deliver 1,296 units of the Model Y to Norway in February, taking the top spot.

With early production snafus now seemingly largely resolved, the still-newish Toyota BZ4X finally put in a decent performance in February, with 543 units, gaining 2nd place.

In third (and fourth), were the Volkswagen ID.3 (and ID.4).

 

 

There was little other news concerning the top 20. Having been largely AWOL since September, the Tesla Model 3 regained a respectable ranking in February, with 272 units, taking 7th. Other models in the top 20 saw mostly small shuffles in position.

Lower down the ranks, some newcomer models gained traction. The new Nio EL7, Nio’s next generation of large luxury SUV, saw its first 23 deliveries in February. It will largely replace its older sibling, the Nio ES8, which was based on Nio’s previous generation of BEV technology, dating back to late 2018 (though launched in Norway in mid 2021).

The EL7 is 4.9 metres in length (~10 centimetres shorter than the ES8). It has more modern,  sleeker styling, and better aero, though it lacks the 7 seat option that the ES8 offered. The EL7 has faster acceleration (0-100 in 3.9 seconds), and slightly faster charging performance (40 minutes 10% to 80% on DC) compared to its older sibling. It too offers Nio’s battery swap service.

Starting with just 12 units, the new Hyundai Ioniq 6 sedan also saw its first customer deliveries in February. This is based on the same technology platform as the already popular Ioniq 5 SUV, but in a sleeker, low aero, sedan form. It is already very popular in the home market of Korea, and can be expected to do well in Europe.

Let’s now look at the 3 month picture:

Unsurprisingly, the Tesla Model Y has a large lead, over the Volkswagen ID.4 in second, and the Volvo XC40 in third.

Here are the main climbers since the previous 3 month period:

• Mercedes EQC up from 13th to 7th
• VW ID.Buzz up from 30th to 9th
• Ford Mustang Mach-E up from 19th to 11th

Apart from the Tesla Model 3’s ups and downs mentioned above, there were not many other significant changes in ranking over the period.

 

Outlook

Norway’s economy is high and dry relative to every other country in Europe, as we first discussed last month. Its gas export revenue tripled in 2022 compared to 2021, earning it large revenues, thanks in part to a new “Baltic Pipe” opening to deliver gas to desperate European neighbours.

In a potential bombshell report, Pulitzer prize winning investigative reporter Seymour Hersh, renowned for exposing the Vietnam My Lai massacre to the world back in the late 1960s, has recently claimed to have inside sources that tell him that Norway and the US were responsible for the September 2022 sabotage explosion of Germany’s Nord Stream pipeline.

Whitehouse spokespersons have of course denied any such claims on the part of the US, calling them “utterly false and complete fiction,” and the Norwegian government has called them “nonsense”. Sweden refused to release the findings of its October 2022 investigation, citing “national security“.

A few German politicians (from across the political spectrum) have raised questions about Germany’s inaction over the attacks, (e.g. Sevim Dağdelen), in the face of deafening silence from most of Europe’s news media and most politicians, typified by the Swedish response noted above.

It may be years or decades before the majority of us find out which country was in fact responsible (and note that most European intelligence agencies have already concluded that it was probably not the Russians).

The EV community should be very concerned about environmental progress, so we can’t ignore that the natural gas leaks caused by the sabotage are estimated to have caused the equivalent of 14.6 million tons of CO2 in climate damage! How much is that? The average modern combustion-only car emits around 100 grams of CO2 per km, and travels ~12,000 km per year in Norway, so releases around 1.2 tons of CO2 per year.

The climate damage from the sabotage leaks therefore amounts to around 12.2 million cars driven for an entire year. Norway’s entire auto fleet is around 2.8 million vehicles, so this is equivalent to every Norwegian car being driven on combustion power, for more than 4 years.

In terms of climate cost/benefit, the damage therefore more than outweighs all of Norway’s emissions reduction progress in the EV transition, since it began.

For the sake of Norway’s green credentials, perhaps we should then hope that Hersh’s allegations, that Norway was involved in the sabotage, are simply not true. The alternative is just too horrifying to contemplate.

What are your thoughts on Norway’s EV transition? Please join in the discussion in the comments below.

The post EVs market share continues to grow in Norway first appeared on 🔋PushEVs.

In February, Sweden’s plugin electric vehicles continued to dominate with a 54.0% share of auto sales, up from 51.6% year on year. Full electric share grew substantially, whilst plugin hybrid share decreased. Overall auto volume was 18,442 units, down some 13% YoY. The Volvo XC40 was February’s best selling BEV yet again, holding the lead for the 5th consecutive month.

 

 

February’s overall plugin result of 54.0% comprised 33.2% full electrics (BEVs), and 20.8% plugin hybrids (PHEVs). These compare with respective shares of 51.6%, 25.6%, and 26.0%, YoY.

We can see that BEVs are continuing strong growth in share, whilst PHEVs are now declining. This is partly a result of deliberate policy changes that have sought to support BEVs over PHEVs.  The plugin market is still re-settling after a strong pull-forward in December, and will take a couple more months to find a new equilibrium.

Plugless HEVs are slowly decreasing, having hovered around 9% share over the past 6 months, from near 15% in 2020. Combustion-only powertrains have averaged under 29% recently, from 53% in 2020.  On current trends, we can expect plugins to regularly exceed 80% share a couple of years from now.

 

 

Top Selling BEVs

The Volvo XC40 again took the top spot in BEV sales in February, for the fifth month running. It is looking unassailable for the time being, certainly amongst its similar priced peers, such as the Volkswagen ID.4 (2nd place), and the Tesla Model Y (3rd).

 

 

Sweden’s auto buyers have, for years, favoured midsized vehicles, whether sedan or, more recently SUV. This preference is at odds with most European markets, where affordable compacts sell at much greater volumes (e.g. VW Golf, Peugeot 208, and similar). So, even when affordable BEVs in the compact categories start to be available at high volume, and take the lead in other European markets, they aren’t necessarily likely to displace the lead of the Volvo XC40 (or its future successors) in the Swedish market.

There were no outstanding growth stories, or “personal bests” in February’s top 20, just normal jostling in the ranks.

A few newer BEV models were detected much further down the rankings, with the BYD Han registering 20 units, from an initial 8 units in January.

The Nio EL7 recorded its first Swedish sales in February, with 12 registrations. This is a large luxury SUV, with decent range and tech, competing with the BMW iX, the Mercedes EQS SUV, the Tesla Model Y, and similar luxury SUVs priced around €100k (and up).

One of the Nio EL7’s peers, the Hongqi E-HS9, also debuted Swedish sales in February, with a modest 4 units.

Now let’s have a look at the 3-month picture:

 

Unsurprisingly, the Volvo XC-40 took the top spot, from the Volkswagen ID.4, and Volvo C40. These top 3 BEVs were unchanged from the previous 3 month period.

The main climbers compared to the previous period were as follows:

• Tesla Model Y up from 8th to 4th
• Kia EV6 up from 9th to 5th
• BYD Atto 3 up from 44th to 6th
• MG5 up from 19th to 12th
• Peugeot 2008 up from 33rd to 17th

These models lost ranking:

• Nissan Leaf fell from 7th to 13th
• Ford Mach-e fell from 11th to 24th
• Mini Cooper fell from 18th to 33rd

As usual, most of the changes in rankings reflect manufacturers’ constantly shifting allocation decisions over the limited supply of the most popular BEVs, rather than necessarily reflecting their unconstrained demand.

One thing to watch for is the Tesla Model Y’s continuing ramp up of production (and thus supply) from the Berlin Gigafactory. Last week saw 4,000 units produced, so nearing 20,000 units per month, all of which will go to European consumers. Some thousands of units from Shanghai are also still coming to Europe each month.

Given that mid-sized SUVs are Sweden’s most popular category, it’s no great stretch to envisage that at least 1,000 Model Ys per month could be heading to Sweden in the near future, potentially placing it close to the top of the ranks, and pressuring the Volvo XC-40.

 

Outlook

Sweden’s auto industry agency, Mobility Sweden, claims that order books for plugins coming from private consumers are currently “cold” due to November 2022’s abolition of incentives, and the broader economic pressures. This will begin to be visible in BEV registrations in late summer.

On the other hand, the majority of Sweden’s plugin orders come via company cars, and from commercial leasing operators, which tend to make decisions based on long term economic calculations, and must try to go about their business despite temporary plugin incentive fluctuations.

The country’s general economic outlook remains troubling, with the national statistics office last week finding that 2022 Q4’s economic shrinkage was slightly greater than initially thought, and inflation continues to grow. Further economic decline is expected in the coming months, with the EU commission predicting that Sweden will see a 0.8% economic recession across 2023 as a whole.

To the extent that spending on new cars will be suppressed, the relative merits of plugins remain strong compared to ICE vehicles, so their share of the auto market may be expected to grow, even if that overall market takes a hit.

What are your thoughts on Sweden’s EV transition? Please jump in the comments below to join the discussion.

The post BEVs start to replace PHEVs in Sweden first appeared on 🔋PushEVs.

Germany saw plugin electric vehicle (EV) share at a low ebb in January, just 15.1%, from 21.6% year on year. The one-off low result comes in the shadow of record plugin share in December, ahead of reduced incentives from January 1st; the imbalance will normalise in the coming months. Overall auto volumes were 179,225 units, just 2% lower than January 2022, though still well down from pre-Covid seasonal norms. The best selling BEV was the Tesla Model Y.

 

 

January’s combined plugin share of 15.1% comprised full electrics (BEVs) at 10.1%, and plugin hybrids with 4.9%. Their respective shares in January 2022 were 21.6%, 11.3%, and 10.3%.

Trend analysis

BEVs took a slight YoY dip in volume, from 20,892 units in January 2022, to 18,136 units this time around. This reflects the hangover from the December pull-forward, ahead of the roughly €1500 trimming of incentives from January 1st (see last month’s report for details). Since this is a modest change, and still leaves €3000 to €4500 BEV incentives on the table, the hangover is not overly dramatic for BEVs, and the market should equalise by sometime in Q2.

PHEVs on the other hand saw a more dramatic complete incentive cut. This means that a consumer buying a PHEV before the end of December was saving around €4000, compared to buying in January. The large cost change created a much stronger pull-forward-and-subsequent-hangover disjuncture.

As a result, the PHEV category in January saw their lowest market share since June 2020, and unit volumes just 12.7% of those seen in December. It will be several more months before we can begin to detect what the new steady-state market share of PHEVs is likely to be. There may remain some distorting PHEV incentives in, e.g., company tax rates, and similar (beyond simply the lower rated CO2 emissions). Please chime in below if you have insights into this.

Personally, I think the only “incentive” for PHEVs should be the intrinsic running cost savings that they provide when correctly used as a plugin, along with the convenience features of having a large battery (cabin pre-conditioning, etc), and the other experiential benefits of electric drive (smooth, silent, etc).

Because of these fiscal incentive disjunctures, we can’t read too much into the December-through-January pattern of plugin sales, other than saying that the overall the move to EV will continue. We will get more of a handle on 2023’s plugin trajectory perhaps by the end of Q2, and certainly later throughout the second half.

 

 

Best selling BEVs

January saw an interesting distinction in market leader Tesla’s model deliveries:

The habitual first-month-of-quarter low volumes were still evident for those models produced overseas and arriving via global shipping, most noticeably, the Tesla Model 3, which again saw a relatively quiet month (389 units), compared to December and November.

With the local Tesla Gigafactory in Brandenburg now producing decent volumes of Model Y, however, its January performance was very strong, with 3,708 units. We haven’t seen the first month of a quarter with these volumes for a Tesla model previously, and this should become the new normal, from now on.

In second place was the Volkswagen ID.4/ID.5 pair, with the refreshed Audi e-tron (which from now on is badged as the Q8 e-tron), taking third.

 

 

The Tesla Model Y’s January volumes were in fact so strong that it actually took 4th spot in the overall auto market for the month (behind the VW Golf, VW Tiguan, and VW T-Roc), something never previously seen in the first month of a fiscal quarter.

Over a 3 month period, the Golf, and Tiguan, are nevertheless each selling around 20,000 units (sometimes a bit more), whereas the Model Y is still “just” around 15,000 units for now. With production still ramping at the Brandenburg factory, Tesla could close this gap.

Further down the top 20 list there were a few movements in the ranks, but considering the market disjuncture discussed above, we can’t read too much into these.

There were four BEV models new to the German market in January; the BYD Atto 3 (48 initial units), Genesis GV60 (27 units), Hyundai Ioniq 6 (8), and even the Lucid Air (2). Diversity of choice is obviously healthy for the continued improvement of EVs, so it’s good to see these new arrivals. It will be interesting to see if the GV60 and Air are given attention by German premium-segment consumers, who have transitionally favoured their home-grown premium brands.

Let’s now turn to the three month picture:

 

Tesla’s models have a very strong lead, on the basis of massive volumes since November. Volkswagen’s ID models will need to step up to catch up. This is not just in Germany — the balance is roughly similar at the Europe-wide level.

Most of the top 10 rankings have shown remarkably little movement (one or two positions at most) since three months ago.  Gainers include the Opel Corsa (10th from 18th), and Renault Megane (12th from 17th).

Those falling in rank, since 3 months prior, include the Hyundai Ioniq 5 (7th to 13th), Audi Q4 e-tron (10th to 14th, Skoda Enyaq (12th to 18th), and Mini Cooper (13th to 19th).

Many of the larger movements are due to irregular global logistics patterns (particularly Tesla, Hyundai, MG), and temporary regional allocation decisions. As a reminder, the best BEVs (i.e. most or all of the top 20) are production-and-supply constrained, rather than demand constrained.

Let’s take a quick look at the manufacturing group performance:

The top four ranks are unchanged since the three months to October. Volkswagen Group has actually taken 2.2% more of the German BEV market pie since the prior period. Tesla lost 1.5%, Stellantis gained 2.2%, and Renault–Nissan gained 1.1%.

In the lower half, BMW Group slipped from 6th to 7th (just outside this table), and Mercedes Group climbed from 7th to 5th, pushing Hyundai Group down a spot to 6th.

 

Outlook

January’s low plugin result is a one-off, the hangover from the significant pull forward we saw in December (and to some extent, November). In a few more months, the market will settle in to a new normal.

More broadly, the German economy continues to face significant headwinds, which will necessarily affect the auto market this year. The government statistics office just reported a 0.2% QoQ shrinkage in the final quarter of 2022, which was worse than expected.

Q1 2023 is also expected to show shrinkage, which means that 2023 will likely start in recessionary conditions. As of early February, the Scope ratings agency expected a 0.2% economic decline across 2023, whereas in late January, the government was still hoping for 0.2% growth. This latter was before the news of the 2022 Q4 shrinkage however. Deloitte forecasts 0.4% shrinkage, amid declining consumer spending.

Obviously heavy energy users, like the auto manufacturers and their supply chains, will face cost pressure from energy price inflation. This comes just as consumers are facing both recessionary conditions and inflation (still near 10% overall).

These macro economic conditions suggest growth in overall auto sales is unlikely in 2023, even if the auto supply chain shortages seen over 2021 to 2022 are somehow improved.

As I usually point out, since demand for plugins will likely remain relatively buoyant in the context of a shrinking overall auto market, this does at least mean that plugin share of the market will continue to grow. We will have to see how all these factors play out.

What are your thoughts about Germany’s auto market outlook for 2023, and the EV transition? Please jump in and share your perspective, in the comments below.

The post Domestic Tesla Model Y dominated the German EV market in January first appeared on 🔋PushEVs.

The UK auto market saw plugin electric vehicles (EVs) take 20.0% share of new sales in January, flat from 20.4% year on year. Full electrics grew slightly whilst plugin hybrids shrank. Overall auto volume was 131,994 units, up some 15% YoY, but still 21% below pre-2020 seasonal norms. Volkswagen was the UK’s best selling BEV brand in January.

 

January’s combined plugin share of 20.0% comprised 13.1% full battery electrics (BEVs), and 6.9% plugin hybrids (PHEVs). These compare with respective shares of 20.4%, 12.5%, and 7.9% YoY.

It’s normal for January’s plugin share to take a significant step back from December’s results, when manufacturers  push to meet fleet emissions requirements, and to boost their PR credentials for annual plugin progress. This year, there was additional pressure in some European markets for a “big December” since many plugin incentives have also been cut as of January 1st. So where December often sees a pull-forward, January inevitably sees a bit of a hangover.

Whilst this year France saw YoY plugin share growth in January, both the UK and Sweden have seen January’s plugin results flat,  and both Norway and Germany saw a decline. The good news is that flatness or decline is mostly due to falling PHEV sales (stemming from incentive cuts), whilst the performance of BEVs has been more resilient.

Meanwhile, diesel-only vehicles continued their decline, reaching 4.0% share of the market in January, from 5.2% YoY. Petrols were flat YoY in January, but are also on a slide over the long term. Plugless hybrids continue to replace combustion-only powertrains, offering a bit more efficiency, which — whilst a slight emissions improvement on the status quo ante — are only a temporary fix, and will lose out to plugins over the longer term.

 

 

UK’s leading BEV brands

January saw Tesla at the low-ebb of their logistics cycle, so the Volkswagen brand had a chance to take the lead spot on the UK BEV market. They were closely followed by group sibling brand, Audi, with BMW taking the third position.

 

 

This was a big gain for Audi, who are usually much further down the rankings (7th in December). Others seeing gains were Kia, taking 5th (from 16th in December), and Hyundai (8th, from 14th). Other brands were making more minor moves.

To iron out monthly logistics variations, let’s look at the trailing 3-month results:

 

 

Here Tesla retains its usual dominance in the UK market, with Volkswagen and BMW vying for second spot.

Audi has seen a decent upward move to 5th, since three months ago when it was in 8th. Polestar has also climbed, now in 7th (from 12th), as has Renault (8th from 17th).

Fallers compared to three months prior include Mercedes (5th to 9th), Hyundai (6th to 10th) and a few of the Stellantis brands (Vauxhall/Opel, Peugeot, Fiat, and DS). As usual, many of these moves will prove temporary, and regional allocation decisions can change things again in the future.

 

 

Above is a quick look at the manufacturing group charts. Tesla is dominant, but the Volkswagen group is not far behind. Recall that Volkswagen Group was temporarily in the lead in July and August, after Tesla’s Shanghai production snafus.

BMW Group took 3rd, where it has been steady since October, on the strength of its diverse BEV model line up. The i4 is popular in the UK market, and won Auto Express‘ premium car of the year in 2022. The BMW UK website displays all the BEV models front and centre, and in January some 22% of BMW’s UK sales were BEV (the highest of any large legacy brand), almost doubling from January 2022.

 

Outlook

The UK’s industry body, the SMMT is currently forecasting 1.79 M autos to be sold in 2023, some 11% growth over last year.

The broader economy is in a tough spot, with the IMF forecasting a recession of 0.6% in 2023. Inflation remains above 10%, and consumer confidence is at a low point. Against this background, the SMMT’s forecast of auto growth looks optimistic.

The SMMT don’t give the logic behind their growth forecast, perhaps they are looking at long order books and hoping that easing supply chain woes will help bolster sales this year. But this may be wishful thinking. Consumers may let their prior orders slide as their economic circumstances take a change for the worse. We will have to see how it plays out.

Regardless, plugin share of the market should still see an upward trajectory this year, as the economic advantages remain in place over the long term.

What are your thoughts on the UK’s auto market and EV transition? Please jump into the discussion below.

The post Electric car sales remain low in the UK first appeared on 🔋PushEVs.

France’s auto market saw plugin electric vehicles (EVs) take 22.3% share of new sales in January, up from 17.6% year on year. Full electrics saw stronger growth than plugin hybrids. Overall auto volumes were 111,939 units, some 9% higher YoY, but still well below pre-2020 seasonal norms. January’s best selling full electric was the Dacia Spring.

 

 

January’s 22.3% combined plugin share comprised 13.1% full electrics (BEVs), and 9.2% plugin hybrids (PHEVs). These compare with respective shares of 17.6%, 9.9%, and 7.7%, a year ago.

In volume terms, BEVs grew YoY from 10,217 units to 14,626 — annual grow of over 43%.

The BEV bonus saw a small modification from January 1st, trimming the value from €6,000 to €5,000 for most consumers, but for those on low incomes, increasing it to €7k. The bonus is limited to a max vehicle price ceiling of €47,000, and a max proportion of 27% of the vehicle price.

For example, the Dacia Spring (January’s bestseller), priced from €20,800, receives a bonus of €5,000 for most consumers. This brings the effective outlay down to €15,800.

Diesels saw a big YoY hit in January, falling from 18.3% to 11.2%. At this point in 2021, diesels took a quarter of new sales. Expect them to continue to fade throughout 2023. Plugless hybrids are also no longer growing as strongly as plugin categories, and currently are on a trajectory to plateau at no more than 25% of the market.

 

 

 

Best selling BEVs

The Dacia Spring was the best selling BEV in January, keeping its top spot from December. Second place was claimed by the Fiat 500, and third by the Renault Megane.

 

 

The Spring now comes in 3 variants, two of which are trim related, and the newest of which (mid January announcement, summer deliveries) has a higher power motor (48 kW) compared to the standard (33 kW). This allows the Spring to now appeal a bit more to folks who want peppier acceleration (as well as higher peak regen power).

On paper, the 0–100 km/h time of the stronger motor is still very modest, at 13.7 seconds (up from 19.1 seconds for the standard motor). Acceleration at typical European urban speeds (~5 to ~60 km/h), however, will feel much more responsive than many competing entry-level ICE vehicles. Especially given the lack of gear shifting delay.

 

 

Overall, it is great to see Dacia gradually evolving the powertrain of the Spring — next stop perhaps a slightly larger battery option and faster DC charging? Sales will surely see a decent boost as the options broaden out.

Most of the remaining January BEV top 10 faces were broadly familiar. A stand out result was from the new MG4, with 686 units, almost the same as December (729 units). With January being a lower volume month overall, this performance was enough for the MG4 to gain the #5 spot (from 10th last month), its highest ever.

Let’s now step back to get a view of the longer term trend:

 

 

Note that — with only thin data available — I can’t yet define the 8th to 10th positions. The contenders for these missing ranks are almost certainly the Mini Cooper, Volkswagen ID.3, and Renault Twingo (likely in that order), with volume in roughly the 1700-1800 unit range.

Having led the December and January sales, it’s no surprise to see the Dacia Spring take the top spot over the trailing 3 months. The race for second was remarkably tight between the Renault Megane, and the two Teslas. Other regular favourites, the Peugeot 208, and Fiat 500, took 5th and 6th. It is good to see the MG4 now climbing into 7th place.

If I had to place a bet this early in the year, I think the Renault Megane is still the favourite to take the annual title, but much of that is on the strength of Renault prioritizing deliveries of this model into the home market. Let’s also see how the new Peugeot e-308 will do once it is released in the next couple of months.

 

Outlook

Auto industry data organization, AAA Data, summarized their take thus;  “The year 2023 is off to a better start than 2022. And we could almost speak of an upturn, in a context that remains marked by a shortage of supply, coupled with a difficult national and international environment.” (Machine translation).

The French economy is holding up a bit better then the German and UK economies, the latest data suggests. Q4 2022 narrowly escaped an economic dip (0.1% growth), and the outlook for 2023 is currently barely flat. Sentiment however is at a low level, with street protests 1.25 to 2.5 million strong in recent weeks, and inflation high (6%) and forecast to grow further in H1.

These social and economic conditions will obviously weigh on the auto market, and we can’t expect much overall growth compared to 2022. However, the relative attractiveness of plugins remains in place, so we can expect their share to keep growing this year, especially if overall auto volumes don’t see growth.

What are your thoughts on France’s auto market and EV transition for 2023? Please jump in below and join the discussion.

The post Dacia Spring takes the lead in France first appeared on 🔋PushEVs.

Norway saw plugin electric vehicles take 76.3% share of the auto market in January, down from 90.5% year on year. The January auto market was highly anomalous due to the new year’s introduction of tighter auto emissions and tax increases, which had pulled sales forward into December. Overall January auto volumes were just 1,860 units, under 5% of December’s volume, and the lowest monthly volume in over 60 years! The auto market will resume more typical patterns in the months ahead. January’s bestseller was the Volkswagen ID.Buzz.

 

 

January’s combined plugin result of 76.3% comprised 66.5% full electrics (BEVs), and 9.8% plugin hybrids (PHEVs). These compared with respective shares of 90.5%, 83.7%, and 6.8% a year ago.

Due to the anomalous tax discontinuity mentioned above, we have to take January’s picture with a pinch of salt — it doesn’t tell us very much. For a recap on what the new emissions and tax changes involve, take a look back at my summary in last month’s report.

The new policies affect both plugins and non-plugins, although the latter are hit much harder. For example, petrol-only vehicles (with relatively high CO2 emissions) are now taxed much higher in Norway. That’s the reason why there was a December rush of 2,503 petrol-only units, whilst January saw just 36 units, roughly two orders of magnitude less!

For the most popular and affordable entry BEVs, the effective outlay for the consumer is now roughly 5% higher than it was previously. For the midsized SUVs that Norway favours, the additional outlay is roughly 8% to 10%, or more. This is a comparatively light burden compared to all other powertrains, and smaller and less expensive BEVs are (relatively) favoured.

For most auto consumers, who are anyway facing 6 to 12 months of wait time between orders and delivery, these new rules — once “digested” — should even boost plugin share further. We are anyway in a situation right now where December’s and January’s results were shaped NOT significantly by demand side, but by supply side, as manufacturers made a short-term push, to keep customers happy, ahead of effectively higher costs.

I suspect that — once things settle down — we will find that petrol-only sales will have experienced a permanent discontinuity. I don’t expect them to ever get above 2% in the future, excepting further one-off anomalies, and fast heading towards only trace amounts.

Overall, it will be interesting to see what the auto landscape will look like once these new policies become normalized and new consumer preferences (i.e., orders) start to work their way through into the sales results.

 

 

Best Selling BEVs

With the caveat that we can’t read much into January’s tea leaves, the Volkswagen ID. Buzz was the best selling vehicle for the month, fractionally ahead of its sibling the ID.4. Their cousin, the Skoda Enyaq, came in third.

 

 

One surprise was the Mazda MX-30, which didn’t see significant drop in supply volume, or registrations, compared to H2 2022. As in neighbouring Sweden, and in other European markets, Mazda is now releasing the range-extender (REx) variant, which may prove popular with folks who might otherwise have shopped for PHEVs or non-plugins. With its modest battery size, and the REx being the in-house “Wankel” design, Mazda should find itself relatively unconstrained in producing this vehicle.

There were no all-new passenger BEV models released on to the Norwegian market in January.

Let’s now look at the 3-month picture, again with the caveat that December and January have been anomalous months:

 

The Tesla Model Y leads, as it has for most of the past 18 months. Other regular favourites, the VW ID.4 and the Volvo XC40, take 2nd and 3rd.

Given the current anomalies, I hope you don’t mind if I skip a summary of the risers and fallers this month, and likely next month. Once we get to the March report, I will revisit this and compare the Q1 2023 favourites to those from Q3 2022 (before the “madness” set in).

 

Outlook

As we have seen, the auto market is in the middle of a serious discontinuity just at the moment, due to the policy changes outlined. It will settle down in due course.

Norway’s road transport information agency, OFV, summarizes the situation: “Because from 1 January VAT was expected on new electric cars over NOK 500,000, and in addition a new weight tax was introduced for all passenger cars. This led to a large price increase for the vast majority of new passenger cars, which in turn led to a massive registration rush before the turn of the year.” (Machine translation).

Beyond these policy changes, the Norwegian macro economy generally continues to look healthier than all its European neighbours. Norway is a rare European fossil fuel exporter, most of whose neighbours now consider a relatively preferable supplier, more so than previously. Consequently, the value of Norway’s gas exports nearly tripled in 2022 compared to 2021, and crude oil exports’ value rose by 55%.

However, since most consumer goods, and energy, are internationally traded, price inflation in Europe is also experienced by Norwegian consumers. This will inevitably affect consumption patterns, despite the massive boost in exports at the national level. Let’s see how this combination plays out, especially for the auto market.

What are your thoughts on Norway’s transition to electric transport, and how it might be shaped in 2023 by broader economic factors? Please jump into the discussion below.

The post Auto sales drop to new low in Norway first appeared on 🔋PushEVs.

Sweden’s plugin electric vehicle share in January was 52.4%, flat from 52.9% year on year. The temporary pause in growth comes after a pull-forward in December. Overall auto volume in January was 35,476 units, some 27% down from January 2022. The best selling full electric was the Volvo XC40.

 

 

January’s combined plugin share of 52.4% comprised 28.9% full electrics (BEVs), and 23.5% plugin hybrids (PHEVs). This compares to respective shares of 52.9%, 25.9%, and 27.0% a year ago; thus BEVs are still steadily replacing PHEVs in share.

With plugless hybrids (HEVs) also seeing a slight YoY growth in share, combustion-only vehicles were squeezed, and continued to lose share.

In volume terms, all powertrains except the miniscule “other fuels”, lost volume year on year.

 

Murky Incentive Changes

January’s low ebb for plugins was said, by industry association Mobility Sweden, to be “a consequence of the high number of new registrations in December ahead of the reduction of the climate bonus from 1st January.” No further elaboration.

And so… I must admit to now being a bit confused. Based on several hours of previous research of Swedish reports (via machine translation), I had understood that the bonus cut had already been put in place — with immediate effect on 8th November 2022 — for any plugin order placed after that date, as I reported last month.

Now I find this throw away comment by Mobility Sweden, and – after much more digging – that the Swedish transport agency has since issued more correctives and attempts at clarification about the bonuses. They have recently said both that “from the turn of the year [Jan 1st 2023], the rules for climate bonuses will change,” and also that, “The climate bonus ends on the 8th November [2022].”

To their credit, the agency appears to realize the messaging is prima facie contradictory, saying “I understand that it can be perceived as contradictory when we go out and inform about changes to something that we previously announced has ceased to apply. That’s why this clarification feels urgent, says Jonny Geidne, qualified investigator at the Swedish Transport Agency.” Yet, the alleged “clarification” itself doesn’t actually provide any clarity — perhaps something is getting lost in translation.

At this point, I’d like to request any of our readers who are Swedish speakers, and have a very clear grasp of all the relevant incentives, and their recent changes, to kindly help me and our other readers to understand all of this. Please jump in to the comments section below, if you can decode what is going on.

Regardless, looking back from here at the data from recent months, we can now conclude that there was indeed a pull-forward effect on plugin registrations in November and especially December, from which January experienced a significant hangover. This explains the lack of YoY growth in January. Once we have more clarity on the incentive landscape, we might be able to foresee when things will normalize again (I will update this report if our community steps up).

Update: Two of our kind community members have pointed out that there are now overlapping rules in effect. Yes, the 8th of November ENDING of bonuses for new orders is still the most impactful one in the long run, but an earlier ruling from Spring 2022 had anyway decided to cut the AMOUNT of the bonus, coming into effect from January 1st 2023 (by roughly a third of its value). This applies to deliveries, rather than orders (different to the November 8th ruling).  So there was a rush by manufacturers to fulfil customer deliveries before the Jan 1st bonus reduction. Thus this was a supply side pull forward (should that be a “push forward”?), but a pull forward nonetheless.

This likely means that manufacturers will now effectively de-prioritise Swedish plugin supply for a while, although we can expect e.g. Tesla to still make a big push in March. I would expect plugin supply (and thus market shares) will return closer to trend by the close of Q2. However, November 2022’s “ending” of bonuses for new orders may start to be visible in Q3 and Q4 2023 (due to long waiting lists / delivery delays).

Over the next couple of years, the overall long term trend for plugin powertrains in Sweden will of course remain “up and to the right”.

 

 

Best Selling BEVs

While overall BEV volumes declined, the Volvo XC40 nevertheless retained its top spot in the charts, albeit at a quarter of December’s volumes. The Kia EV6 took #2, and the Volvo C40 took #3.

 

 

Only a couple of the top 20 BEVs increased their volumes in January compared to their recent averages. The Mazda MX-30 got close to its record volumes, with 178 units. It is now available in both the base battery-0nly model, and in a range-extender version (with over 50 miles / 80 km of electric-only range).

The new BMW iX1 saw 110 units in January, and should continue to grow from here (subject to adequate supply).

At the other end of the scale, both the Ford Mach-e, and Aiways U5, didn’t ship at all in January. All the Teslas were at the low end of their logistics wave, as were several other models that performed well in December (e.g. BYD Atto 3, Cupra Born, VW ID.5, and more). Again, many of these changes simply reflect temporary allocation reversals, after the pull-forward rush in December.

In terms of new faces, the BYD Han saw its first Swedish samples arrive in January (8 units), and the Nio ET7 also appeared for the first time (just 1 unit). Both are large sedans, around 5 meters in length, and decent value compared to segment rivals. We will have to wait a few more months to see what volumes they might achieve in steady state.

Let’s now step back and look at the trailing three month picture:

 

Continuing to dominate, the Volvo XC40 again took the top spot, a strong turnaround compared to its low ebb between May and August. The Volkswagen ID.4, the previous favourite, again had to settle for 2nd place. The Volvo C40 came 3rd.

Here are the significant climbers compared to 3 months prior:

• Volvo C40 up from 9th to 3rd
• Tesla Model Y up from 10th to 4th
• BYD Atto 3 up from 69th to 9th
• Renault Megane up from 28th to 12th

The following models dropped rank:

• Skoda Enyaq fell from 3rd to 8th
• Nissan Leaf fell from 4th to 12th
• MG ZS fell from 8th to 19th
• Tesla Model 3 fell from 11th to 30th
• BMW i3 fell from 20th to 63rd

Most of these changes are temporary, but the venerable (and still futuristic) BMW i3 is now finally phasing out everywhere except for Germany, where a modest number continue to be supplied (for now at least).

It’s somewhat ironic that — just as the most interesting 1st generation range-extended BEV is retiring — Mazda is coming forward with a new iteration of this format.

I still think that a BEV+Rex which has decent all-electric range (80+ km /50+ miles) which can be used fully independent of the ICE, is still a good compromise at this stage whilst global battery production capacity is still a limiting factor keeping ICE-only sales afloat. Three 20 kWh BEV+Rex vehicles in daily use with families and commuters are typically going to electrify a lot more KM driven than a single 60 kWh BEV plus two ICE-only vehicles. Later in life, on the used market, even with a potentially failing Rex engine, these can step into the role of local-duty BEV-only vehicles, for years into the future (much like early Nissan Leafs still do today).

When global battery production capacity is no longer a bottleneck, the calculus will of course be different. We are not there yet. BEV “purists” feel free to preach to me in the comments for this heresy 

 

Outlook

Obviously the Swedish bonus-policy changes mentioned above have temporarily disturbed the auto market, but the transition will doubtless settle back closer to long term trends in due course. I keenly await clarifications from our Swedish readers on what the “actual” changes to the incentives have been, and insights into likely near term market patterns. Thanks to the community members mentioned above for their help in clarifying the state of things.

Sweden’s wider economic landscape is also shaping the auto market. Mobility Sweden says that “Private customers are decreasing as a result of the economic situation and households’ reduced purchasing power… price increases on the cars, higher interest rates, and a reduced bonus for ordered cars… The increasingly difficult financial situation for households is contributing to a shift from private customers to business customers.” (Machine translation).

This reflects the Swedish economy having shrunk in Q4 2022, with the finance minister forecasting recession lasting into 2024, and inflation being at its highest rate in over 30 years (and climbing). Sweden isn’t alone here, as the UK and German economies are also now in (or entering) recession.

We will have to see how the economy shapes Sweden’s auto market and the EV transition. With the long term cost savings, I still expect plugin share of the auto market will grow this year, but partly because overall auto volumes are likely to be tepid.

What are your thoughts on Sweden’s auto market and EV transition? Please jump in below to join the discussion.

The post PHEVs sales still strong in Sweden first appeared on 🔋PushEVs.

The UK’s auto market saw plugin electric vehicles take 39.4% share of new sales in December, a new record, up from 33.2% year on year. Full electrics alone took almost a third of the market. Overall auto volumes were up 18% year on year in December, but still down compared to pre-2020 norms. The Tesla Model Y was the UK’s overall 3rd best selling vehicle in 2022, and the top seller in December.

 

 

December’s combined plugin share of 39.4% comprised 32.9% full battery electrics (BEVs), and 6.5% plugin hybrids (PHEVs). The respective shares in December 2021 were 33.2% plugins, 25.5% BEV, and 7.7% PHEV.

In terms of volumes, December saw BEVs grow 1.53x from a year ago, to 42,284 sales. PHEV volumes were essentially flat year on year, with 8,367 sales.

The full year 2022 plugin share amounted to 22.8% combined, composed of 16.6% BEVs, and 6.3% PHEVs. This compares to full year 2021 results of 18.5% combined, with 11.6% BEVs, 6.9% PHEVs.

The 16.6% result for BEV share represents an annual rate of growth in share of 1.43x, which is a calming from the higher growth rate of 2021 over 2022, which was 1.76x.

The volume in full year 2022 amounted to 267,203 BEVs, up 40% from 2021, and 101,413 PHEVs, down 11.5%. This comes against a background of overall auto sales down by 2.0% in 2022 compared to 2021.

Full year 2022 diesel-only vehicles’ share amounted to 5.1%, down from 8.2% in 2021. For petrol-only vehicles, 2022 saw 42.3% share, down from 46.3% in 2021. Expect petrol’s rate of decline to accelerate in the coming years, once diesel sales have effectively ended.

 

 

UK’s bestselling BEV brands

Tesla made their habitual end-of-quarter huge push in December, with the Model Y (10,664 units) and Model 3 (5,704 units) actually taking the overall top two bestselling autos (of any powertrain) for the month. Note, however, that Tesla’s delivery volumes are so uneven that December alone represented almost one third of the Model Y’s total 2022 sales.

Behind Tesla, the Volkswagen brand (mainly the ID.3 and ID.4) took December’s second place in BEV market share, and BMW (led by the i4) took 3rd.

 

 

In terms of movements, Renault jumped up significantly in December, to #4 spot (from #18 the previous month), likely thanks to the Megane, which seems to have recently started volume deliveries in the UK. Porsche and Skoda brands also climbed the ranks by a few spots compared to November.

Far outside the top 20, the Ora brand saw a few initial deliveries in the UK (just around 20 units for now), which we can deduce must have been the new Ora Funky Cat hatchback. This is a decent value offering in the premium hatchback segment, so let’s see how high Ora can climb.

Let’s now look at the trailing 3-month brand results:

 

 

Here Tesla still has a massive lead, though this is again partly due to the brand’s habit of back-loading deliveries towards the end of the year (see the longer-term full year brand shares below).

Brands which saw gains in Q4 compared to Q3 include Polestar (17th position to 8th position), and Volvo (20th to 12th). Renault also did well (15th to 9th), and Nissan climbed from 9th to 5th. On the flip side, Kia dropped from 7th to 14th, and Hyundai from 3rd to 10th.

As usual, much of the movement is temporary, due to shifting allocation priorities of popular models across many European (and global) markets, where overall demand for BEVs outstrips supply. In the case of the UK, this is even more deliberative, due to the need to batch production of right-hand drive models for this market.

Finally in our UK brand analysis, let’s look back at the full year performance:

 

 

Here we can see that Tesla was still very strong, though not quite to the same degree as in those months and quarters where it biases deliveries. BMW and Volkswagen brands took second and third spots. Note Ford’s weak performance in BEVs, and the fact that Toyota doesn’t appear at all in the top 20 (and, by my calculation, only took 0.2% of the UK’s BEV sales in 2022).

Since we reached the end of another year, the UK auto industry association, the SMMT, provided a top 10 chart of the bestselling BEV models for the year. We can compare the 2022 list (on the left) with the same list from 2021 (on the right):

 

 

As we saw above, the Tesla Model Y (which started UK deliveries in February 2022) has immediately proved the most popular BEV, and jumped into the top spot.

Notice, however the general consistency in popular models between 2021 and 2022. The top 4 from 2021 shuffled down one place to make way for the Model Y, but otherwise kept their relative rankings. However, the Tesla Model 3 took a volume dip, which points to sibling “cannibalisation” from the Model Y. Yet across the two models, Tesla’s combined volume grew by 57% year on year — faster volume growth than the UK’s overall BEV market (40% YoY growth).

Tesla’s relative strength in the UK can be seen by the fact that some the other popular BEV models (the Kia Niro, VW ID.3, Nissan Leaf) saw 2022 volumes roughly flat, or slightly dipped, compared to 2021.

Manufacturing group rankings

Now let’s take a look at manufacturing group performance, first over the Q4 period:

 

 

Compared to Q3, Tesla and VW Group maintained their positions at the top. BMW Group climbed from 5th to 3rd, and Renault-Nissan climbed from 6th to 4th.

The biggest gainer was Geely (owner of Volvo and Polestar) which climbed from 9th to 5th. On the flip side, Hyundai Motor Group fell from 3rd to 6th, and Stellantis fell hardest, from 4th to 8th.

Let’s finally look at the groups’ full year results, and compare with last year.

 

 

I have partial and indicative data for 2021 (though not 100% complete or 100% accurate). In 2021 VW Group had the overall lead, with Tesla in second. In 2022, VW Group lost market share, whilst Tesla gained share, and took the lead.

It seems that the remaining ranking positions are the same as last year. The market share weightings have improved a bit for Tesla, BMW Group, and Geely, at the expense of lost weightings for Hyundai Motor Group, Stellantis, and VW Group.

As Tesla have shown, the introduction of a competitive new model, backed up by relatively unconstrained production volumes, can change the leadership charts. That means there’s everything to play for in 2023 if other manufacturing groups can step up.

 

Outlook

The Model Y was the UK’s overall bestselling BEV in 2022, and, remarkably the third best selling vehicle overall. This is an amazing result given that even the base variant (only offered from late August ’22) costs some £52,000, around twice the price of other vehicles in the UK’s overall top 10.

It is true that, starting from mid December, Tesla UK temporarily offered 6000 miles of free supercharging to incentivise deliveries taken before the end of the month (confirmed by Tesla).

This was likely to try to meet an end-of-year symbolic milemarker in Tesla’s global headline sales, rather than indicating any issue with ongoing UK demand. This temporary incentive may have pulled forward into December some low-thousands of deliveries, which would anyway otherwise have been made in January. Even without this, though, the Model Y would have been the UK’s 4th or 5th overall bestseller for 2022, a great result for BEVs.

Despite the UK’s overall auto market shrinking by 2% year on year (and still being 30% down on pre-2020 norms), BEVs continue to grow strongly, up 40% in volume YoY.

The overall auto market did see 5 consecutive months of YoY growth in the latter part of the year, and the SMMT are currently forecasting some 11% overall growth in 2023, saying “supply chains are beginning to stabilise and although the shortage of semiconductors is expected to ease, erratic supply will likely impact manufacturing throughout 2023.”

PHEVs now appear to have lost momentum in the UK. If Norway and Sweden can serve as guides, PHEVs will keep selling but not grow share by much overall (unless perhaps compelling new BEV+Rex models come available). Plugless hybrids, recently buoyed by “quick emissions fix” mild hybrids, seem to be now slowing their growth.

The only powertrain type with decent growth prospects from here on is BEV.

The long-term total cost of ownership proposition of BEVs is still compelling compared to ICE, even though the differential is temporarily suffering due to extreme electricity price inflation in recent months. New car buyers are aware of the BEV advantages, and we can expect BEV share to continue to grow in 2023, perhaps reaching above 40% of the market at the end of the year.

The actual growth rates for BEVs are now primarily influenced by the volume of supply, rather than by limited demand. 2023’s result will thus primarily depend on manufacturers making decent volumes of BEVs available to the UK market.

What are your thoughts on the UK’s auto market, and the transition to EVs? Please share your perspective in the discussion section below.

The post Full electric cars took one third of the UK car market in December first appeared on 🔋PushEVs.

The tide has turned in the electrification of the German auto market, with plugin electric vehicles taking the majority of sales for the first time in December. Plugins took 55.4% of the month’s passenger auto sales, with full electrics taking a third (33.2%) and plugin hybrids taking over a fifth (22.2%). Plugless hybrids took 12.8%, leaving less than a third of sales for combustion-only autos (31.8%).

Overall auto volumes in December were 314,318 units, up some 38% on December 2021. 2022’s total auto sales were 2.65 million units, up just 1.1% from 2021. December’s overall bestselling vehicle (of any kind) was the Tesla Model 3 with 9,566 registrations.

 

 

December’s combined plugin share of 55.4% is a new record, up from 35.7% year-on-year. The combined result comprises 33.2% full battery electrics (BEVs), and 22.3% plugin hybrids (PHEVs). This compares to share weightings of 21.3%, and 14.4%, in December 2021.

The full year 2022 share of plugins amounted to 31.4%, up from 26.0% in 2021. The 2022 weightings were 17.7% BEV (up from 13.6% YoY) and 13.7% PHEV (from 12.4%).

BEVs thus grew share from 13.6% to 17.7% YoY, a rate of 1.3×. This growth trajectory hypothetically trends for 50% BEV share in full year 2026, and close to 90% in 2028. Obviously, there are a lot of real-world variables which get in the way of hypothetical trajectories, but the current vector is decent.

In volume terms, December saw 104,325 BEVs registered, a breakout new record (the former record was ~58,000, just last month), and over 2× the volume of December 2021. PHEV volumes also grew more than 2× YoY, to 40,259 units.

Part of the influence on December’s very high plugin sales was a looming trimming of Germany’s plugin incentives starting on January 1st. BEVs’ government subsidies have just been cut from €6k to €4.5k for BEVs priced under €40k, and from €5k to €3k for BEVs priced  between €40k and €65k (nothing for vehicles priced above this). The thresholds and subsidy amounts will be further tightened from 2024. Government PHEV subsidies are cut entirely from January 1st (previously around €3.7k to €4.5k per vehicle).

Apart from some temporary pull-forward and rebound effects, these policy changes are unlikely to change the trajectory of the EV transition in Germany, except for denting PHEV sales a good bit. Recall though that Norway and Sweden have already largely moved on from the PHEV phase of the transition, with no major regrets.

Full year 2022 in Germany saw total volumes of BEVs reach 470,592 units. This is decent volume growth of 32.2% over full year 2021, especially in the context of a roughly flat overall auto market.

The combined share of combustion-only powertrains dipped below one third of the market for the first time ever, with diesel-only powertrains falling to 10.8% (from 15.7% YoY).

 

 

Bestselling BEVs — Month, Quarter, Year

Tesla’s usual huge push in the last month of the year resulted in the Model 3 taking the overall bestseller spot in the German auto market in December.

The Tesla Model Y took second spot, with the Volkswagen ID.4/ID.5 coming in 3rd. Not to be outshone, the VW ID.3 made a notable record of its own — outselling its ICE older brother, the iconic VW Golf, for the first time.

 

 

In fact, if we separate out autos by powertrain variant (e.g., the Fiat 500’s summed December sales were 70% the BEV version, and much of the remainder, the HEV version), most of December’s overall top 10 models-by-individual-powertrain were BEVs or PHEVs.

In the above list of December’s top 20 best selling BEVs, most are familiar faces. Are any new models appearing? Far outside the top 20, the new BMW iX1 had a strong second month on sale, registering 807 units (from a 77 unit debut in November). Could the iX1 become BMW’s bestselling BEV in the months ahead? It seems likely.

The Smart “#1”, having only shipped a few dozen units up until now, finally saw noticeable registration volume in December, with 192 units. Let’s see how far it can ramp from here.

A few existing BEV models saw updated versions arriving in December. The Audi Q8 e-tron — a technology update (and model name deconfliction) of the successful original Audi e-tron — started initial registrations in Germany with 21 units in December. It has better efficiency, a larger battery, more range (600 km WLTP on the sportback variant), and faster charging than the original e-tron, with a slight styling refresh also.

Similarly, the long-awaited refreshed versions of Tesla’s two big vehicles, the Model S and Model X — having initially appeared in small numbers in November — saw growing volumes in December (340 and 213 units respectively). Let’s see what the appetite is for these updated versions now that there are more competitors on the market.

Since Tesla (and some others) tend to bias deliveries towards the end of each quarter, let’s take a step back and look at the trailing 3-month performance of the top BEV models:

 

 

Here, the Model 3 still takes an easy lead, though the second spot is a close race. The Model Y, with Gigafactory Grünheide production now ramping quickly, has every chance to separate itself from the pack in 2023.

Overall, it’s good to see some strength-in-depth coming to Europe’s largest BEV market, with a decent variety of high-volume models now competing. There’s much more progress to be made, of course, especially at the affordable end of the market, where almost no models currently exist in Germany (or elsewhere in Europe). The Dacia Spring is the shining exception, but where are the other sub-€25,000 (or even sub-€20,000) BEVs?

Since we’re now in the new year, let’s look back on 2022’s full year bestselling BEVs:

 

 

Again, Tesla’s top 2 dominate the chart. At these volumes, the Teslas are in fact the #9 and #10 overall bestselling vehicles for 2022 in Germany.

Now, with local production ramping, if Tesla is able to hit huge volumes, the Model Y could conceivably enter Germany’s top 5 “overall” in 2023, ahead of the Ford Kuga (#5) and BMW 3 Series (#6). After all, the Model Y has just won the #3 position in the UK market for the full year 2022 (report coming soon).

German consumers are arguably less Tesla-fanatical than UK folks, and to climb as high as #3 in Germany would likely need an altogether more affordable base model than the €54,000 current entry price. Perhaps a variant starting in the mid-forty-thousand euro range (around where the VW ID.4 starts) might do the trick. But until Tesla has more production capacity than demand, there is little motivation to offer a more affordable variant.

 

Manufacturing Group Performance

Finally, let’s have a look at which auto manufacturing groups are leading in BEV sales volume in Europe’s largest auto market. Here’s the trailing 3-month view:

 

 

There have been a few changes since Q3. Volkswagen Group is still top, but with more than 2× the volume than it delivered in Q3. Tesla and Stellantis have switched places, thanks to the latter growing sales more rapidly compared to Q3.

Similarly, Renault–Nissan switched places with Hyundai Motor Group to grab 4th, and Mercedes Group displaced BMW Group to grab 6th.

Here is the full year manufacturing group picture for Germany:

 

 

As we can see, the ranking is exactly the same as the Q4 table above, and even the relative weightings are mostly similar. Note that — for the top 4 groups — between 42% and 45% of their total annual volume was delivered in the final quarter of the year!

Taking a step back, it’s worth remembering that the results in a single market — even one as dominant as Germany — are influenced by decisions over how to allocate the limited production of BEVs across different European markets, in all of which BEV demand currently outstrips supply. Often, local brands favour allocating units to their home market (Volvo in Sweden, VW in Germany, Renault and Peugeot in France). We will wait to see the summed Europe market report later this month to see who the overall volume leaders are in the European region as a whole.

 

Outlook

It is good to see Europe’s largest auto market crossing the 50% barrier in plugin adoption. Yes, this is “only” in the peak month of the year, and yes, 40% of that plugin demand was for PHEVs, which are “only” a transition technology. But this is a milestone worth celebrating, nonetheless.

The future outlook for the German industry is less certain. Germany is still braced for a mild recession in 2023, and particularly affected will be industries with high energy inputs, including the auto industry and many of its suppliers. Highly energy intensive auto supply chains include steel, aluminium, rubber, plastics, and glass, amongst others.

Europe’s industries, including Germany’s crucial auto industry, will face these cost increases, much more so than industrial competitors in all other regions of the world where energy inflation is more modest, and the economic outlook is less unhealthy. This being the case, it is hard to predict the short-to-medium-term future for Germany’s auto industry.

However, in terms of the EV transition viewed purely from the consumer market perspective, the fundamental economic proposition remains unchanged, with long-term costs of ownership, and residual values, strongly favouring BEVs over traditional ICE vehicles.

We see this consumer sentiment reflected in December’s market share, strong relative demand for plugins, and especially BEVs. This will surely continue. What’s less certain is how effectively the industry can continue to transition from ICE to EV, to keep up with this demand, and whether the macroeconomic conditions in Europe will support consumers continuing to make big purchases like autos.

What are your thoughts about Germany’s EV transition, and also the economic prospects for its auto industry? Please jump into the comments below to share your perspective.

The post In December EVs took more than half of the German car market first appeared on 🔋PushEVs.