Democratisation of the market driving boom in worldwide electric auto sales according to AlixPartners Automotive Electrification Index
Market no longer dominated by nice offerings as competition intensifies
China continues to push electrification forward
Established automakers behind an unprecedented new model offensive
LONDON, UK – The AlixPartners FY2017/8 Electrification Index has found that every industrialised country is seeing significantly increased interest in electric vehicles. The move towards electrified cars includes both battery-powered vehicles and plug-in hybrids, technology that is now being developed by the majority of carmakers. The range of electric vehicles sold has increased rapidly with China leading the charge. In the first quarter of 2017, 36.7 million kilometres of electric range were sold globally compared to the last quarter of 2017 where this figure more than doubled to 77.8 million. By way of comparison, in the first quarter of 2013, the figure was 5.6 million kilometres, only one fourteenth of this number.
Tesla’s head start is diminishing
While Tesla has previously dominated the AlixPartners Automotive Electrification Index, twelve Chinese manufacturers ranked among the top 20 in 2017 in terms of electric kilometres sold with BAIC and BYD creeping up on the US manufacturer. Although Tesla maintained first place in the Q4 rankings, with 13 million kilometres in electric range sold, BAIC now stands at 8.8 million kilometres and BYD at 7.4 million.
This indicates a shift in market share away from Tesla, which appears to be profiting less than other manufacturers from the momentum in the global electric auto market. The electric range sold by Tesla grew by 34% in 2016 and 42% in 2017, but the overall market in the industrialised countries grew at a faster pace of 54% in 2016 and 82% in 2017. By way of comparison, the electric range sold by BAIC rose by 216% in 2016 and 130% in 2017. GM also outpaced Tesla in 2016 in the electric range of vehicles sold (104% vs 34%).
Andrew Bergbaum, automotive expert and Managing Director at AlixPartners said: “For a long time Tesla was a leader in the market, and priced its vehicles as such. However, as the traditional global giants and high growth Chinese manufacturers start to add significantly to their portfolios this is no longer the case.”
China leads the charge but Norway is punching well above its weight
For many countries, government subsidies are helping drive the boom in electrified vehicles. China remains the main contributor to the AlixPartners Electrification Index and now accounts for more than half of the electric kilometres sold around the world. In 2016, the electric range sold in China grew by 96%, and in 2017 it expanded another 91% reaching 44.1 million kilometres in Q4.
Norway also reinforced this trend, ranking as number three in the AlixPartners index, despite being a comparatively small country with less than six million inhabitants and almost four million electric kilometres sold. While a long way behind the two largest car markets, Norway is well ahead of heavyweights such as Germany, France, Japan, the United Kingdom and South Korea. The USA also recorded strong growth, with a 61% increase in 2016 and 49% in 2017. With 12.8 million kilometres sold (Q4 2017), the USA is a strong number two in the global rankings.
Expanded model range is enticing customers
AlixPartners believes that the e-boom is due to the greater number of electric car models that manufacturers are bringing to the market. This is highlighted by the fact that in 2017 84 new electrified car models were rolled out, almost as many as in the three previous years combined, and will be boosted further with 271 new electric launches planned between 2018 and 2022.
European automakers and their joint ventures with Chinese partners will be launching 101 models, more than one third of the market total. The Volkswagen Group in particular is investing massively in the development and launch of models with electric power trains, with plans to roll out 55 new models over the next five years – more than all European carmakers combined in the past four years. Meanwhile, Geely is planning to launch 22 new models, Renault/Nissan 12 and BMW 11.
Andrew Bergbaum, concluded by saying: “The results of this years’ AlixPartners Automotive Electrification Index clearly indicate that the race towards widespread electric adoption is picking up pace. The Chinese manufacturers have made huge progress in the electrification of their ranges in the past year whilst the established global carmakers are now flexing their muscles by producing many new models, making massive investment in research and development, and leveraging their traditional strength in manufacturing. What we are seeing therefore is an increasing democratisation of the market as electrification comes to every segment and major geography.
“However, there is only so much that the manufacturers can do on their own. A key factor is government-organised expansion of the e-infrastructure, in particular a network of charging stations. Wherever governments are not involved in actively supporting the underlying infrastructure required, sales of electric cars will lag irrespective of the degree of choice.”
+44 (0)20 7680 6550 / AlixPartnersUK@newgatecomms.com
Notes to editors
About the AlixPartners Automotive Electrification Index
Each quarter, the AlixPartners Automotive Electrification Index measures progress on electrification in the global automotive industry. It does this by calculating the electric range of the vehicles sold, using the formula “number of electric cars sold” x “electric range without combustion engine support”.
A separate analysis determines the level of electrification of the vehicle fleet sold, according to the formula “number of electric vehicles sold” x (“electric range (without combustion engine support) / 500 km”) / “total number of cars sold”. The weighting based on a 500-kilometre range corresponds to the industry-standard range for combustion engines.
The calculations underlying the AlixPartners Automotive Electrification Index include the following vehicle types: battery-powered electric vehicles (BEVs), fuel cell electric vehicles (FCEV) and plug-in hybrid electric vehicles (PHEVs); hybrid electric vehicles (HEVs) with no plug-in option are excluded. The analysis is based exclusively on publicly available data, above all IHS Markit and EV volumes (global sales figures for light vehicles and electric vehicles). The electric ranges for vehicles employed in the calculations are based on data from EV volumes and information published by the car manufacturers themselves.
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