In July, half of all vehicles sold in China were either fully electric or plug-in hybrids, marking a major step forward in the country’s adoption of electric vehicles (EVs). According to industry data, sales of these new energy vehicles (NEVs) surged 37% from the same time last year, making up a record 50.7% of all car sales.
Just three years ago, NEVs made up only 7% of vehicle sales in China. However, significant investments in EV supply chains have fueled the rapid growth of the domestic EV industry, putting China ahead of many Western countries. For example, in the United States, electric and hybrid vehicles accounted for only 18% of sales in the first quarter of this year.
NEV sales growth in China sped up from a 28.6% increase in June. Sales of fully electric vehicles grew by 14.3% in July, compared to 9.9% in June.
This strong NEV sales performance helped local brands like BYD and Li Auto achieve record monthly sales in July. However, overall car sales in China fell by 3.1% as consumer confidence remained low, with the economy struggling due to ongoing issues in the property market. To boost car sales, China’s state planning agency announced in late July that cash subsidies for vehicle purchases would be doubled, retroactive to April.
BYD, China’s leading EV company, continued offering discounts in July, though not as aggressively as earlier in the year. For example, the price of the hybrid SUV BAO 5 from their off-road Fangchengbao lineup was reduced by up to 17.3% at the end of July.
Vehicle exports from China also grew by 20% in July compared to the previous year, though this was a slowdown from the 28% increase seen in June.
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