EV market in China: Key market research findings
- Reduced total cost of ownership is the primary driver for market growth
- Increased R&D in EV charging infrastructure
- Key vendors—BAIC, BYD, FDG, Geely, Yutong, Wuzhoulong, and Zotye
Technavio’s market research analysts predict the EV market in China to reach more than 1 million units, in terms of sales, between 2016 and 2020. The reduced total cost of ownership of electric vehicles (EVs), as opposed to internal combustion engine (ICE) vehicles, is one of the fundamental drivers for market growth. EVs require high initial investments compared to other technologies but offer cost benefits in the long run, especially fuel cost savings. In 2015, the EV market in China was dominated by battery electric vehicles (BEVs), which accounted for almost 77% of the market. Initiatives taken by the Chinese government to curb carbon and greenhouse gases (GHG) emissions is expected to boost growth in the EV market in China during the forecast period.
The new market research report from Technavio presents a breakdown and analysis of the EV segments by type.
“Increasing research and development (R&D) initiatives in the EV charging infrastructure space is an ongoing trend in the market. Manufacturers are introducing pure EVs and plug-in hybrids and are attempting to develop higher energy density batteries that can store more energy in the same space. Manufacturers are also emphasizing on the development of better vehicle charging infrastructure and reducing charging time and cost. For instance, Envision Solar (a US-based company) entered into two agreements with organizations in January 2016 in Fujian province,” says Siddarth Jaiswal, Lead Analyst, Automotive, Technavio Research.
At present, the passenger vehicle segment dominates the EV market in China by accounting for more than 54% of the market space. Aggressive promotion to widen the range of models by the Chinese government and manufacturers is responsible for the booming of this segment of the market. Easy licensing (unlike the lottery system for ICE vehicles), subsidies, fiscal incentives provided by state and central governments, growing consumer emphasis on creating a better environment are some of the factors that will contribute to the growth of the passenger EV market in China in the coming years.
The key vendors in the market are BAIC, BYD, FDG, Geely, Yutong, Wuzhoulong, and Zotye. The market is largely fragmented and hosts many foreign and domestic players. Many players are investing in China to set up plants and operating joint ventures to cater to the domestic market. As China is expected to be the biggest market for EVs by 2020, several foreign players are entering the market through joint ventures and partnerships. There are several growth opportunities for the vendors to develop new products regarding performance, range, and low charging times.
A more detailed analysis is available in the Technavio report, EV market in China 2016-2020.
We can customize reports by other regions and specific segments upon request.
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