New energy vehicle (NEV) sales in China will likely grow 20% in February compared to a month ago, according to the forecast of the China Passenger Car Association (CPCA). It makes sense, considering the seasonal sluggishness due to the Chinese New Year and the final wave of the COVID-19 outbreak has already passed.
CPCA preliminary estimates
NEV retail sales can potentially hit 400,000 units in February, according to the data released by the CPCA on February 21. Notably, that figure represents a month-on-month increase of 20.3% and a year-on-year growth of 46.6%.
The CPCA further noted that automakers that held nearly 80% of the overall car sales in China expect minimal retail sales growth this month.
As per the preliminary forecasts, passenger car retail sales will hit 1.35 million units in February, indicating an MoM increase of 4.3% and a YoY of 7.2%.
Furthermore, new energy passenger vehicles noted a penetration rate increase of 3.9% to 29.6% from just 25.7% last month.
Nonetheless, it must be noted that these CPCA figures are just preliminary forecasts. That said, it may still change before the release of the final data.
NEV retail sales in China – January 2023
NEVs reported a YoY decline in retail sales of 6.35 to 332,000 units last month, as per CPCA’s data. Notably, that figure also represents a 48.3% decline from December 2022’s record of 640,000 units.
As for the overall passenger vehicle retail sales, it reached 1.29 million last month. It indicates a YoY decline of 37.9% and an MoM drop of 40.4%.
It is worth noting that these recorded declines are not surprising considering the effects of certain short-term factors, including the Chinese New Year and COVID-19’s final wave.
The report also highlighted that the state subsidies expiration and substantial price adjustments by major EV makers had affected customers to delay their purchases.
However, as the Chinese New Year subsided on January 17, the auto market is now recovering. According to the CPCA, the total discount rate in the passenger car market in China was approximately 13.8% in mid-February. Notably, that figure practically aligned with the 13.7% rate last month.
