Shulou(Shulou.com)11/24 Report--

CTOnews.com, February 24 (Xinhua)-- Research firm Canalys has released an overview of electric vehicle trends in 2023, including that electric vehicles should be priced close to comparable fuel vehicles; a price war is launched by the most profitable car companies; government policy changes lead to changes in demand; by 2025, many traditional car companies will have a product line dominated by electric vehicles; assembly sites and sources of raw materials will become increasingly important.

Tuyuan PexelsCanalys automotive industry analysts conduct in-depth analysis on the prospects of the global electric vehicle (EV) market in 2023. Here are some key trends in the market in the coming year:

The market is recovering from the adjustment of electric vehicle subsidy policy in January 2023, and governments around the world adjusted their electric vehicle subsidy policy almost at the same time. This is a huge blow to electric vehicle sales in 2022, as buyers either buy in advance to use 2022 subsidies or postpone purchases to use 2023 subsidies. These adjustments have had a negative impact on 2023 orders and will continue for a whole year. Changes in the major electric vehicle markets include the complete elimination of subsidies for electric vehicles in China, Norway, Sweden and the UK. France, Germany and the Netherlands continue to cut subsidies. A few markets will increase subsidies in 2023, but depending on the brand of electric cars, the United States is one of them. Under the new policy, the government will subsidize different electric models based on prices, places of assembly and sources of battery minerals and parts. But such a policy could have the result of a "further step back" in the United States: fewer vehicles qualify for a federal tax credit in 2023 than in 2022.

Tesla triggered a price war for electric vehicles Tesla cut vehicle prices in January 2023, and competitors are also under pressure to cut prices. When an industry's most profitable head company cuts prices, it will be a devastating blow to many peers, especially emerging brands that have not yet made a profit. Tesla's overall price reduction is about 20%, depending on the model and the market. This will not only expand the target market, but also that Tesla will have more models eligible for subsidies in 2023 than in 2022, especially in the United States. In markets where subsidies are eliminated, price cuts are also good for maintaining sales. As Tesla has no dealer network, marketing activities or cumbersome processes, he can make quick decisions according to local market conditions. Unlike many competitors, Tesla has the ability to achieve economies of scale and fast delivery by improving production capacity and efficiency. Although the price cut will affect the brand's profit margins and cause dissatisfaction among customers who previously bought cars at high prices, for Tesla, more vehicles on the road will improve the company's ability to cash out in terms of software and services.

Regional expansion and market repositioning some of China's emerging electric car brands have gone abroad, targeting markets with strong demand and / or insufficient supply or limited product options, looking for new opportunities. Europe has always been their main target. In 2022, more than a dozen Chinese car companies entered the European electric vehicle market. These brands initially choose to work with distributors, but some brands choose to set up headquarters, service centers and showrooms in Europe. But in 2023, carmakers must remain flexible and switch to other markets if necessary, as demand for electric cars is largely affected by prices and government incentives. Without incentives, the luxury showrooms opened by these brands in places such as Oslo, Norway, will soon be deserted. In addition to Europe, emerging brands have many opportunities in 2023, such as Australia, India, Japan, Latin America and Southeast Asia, many of which still do not have mainstream electric car brands in 2022.

The growth of electric vehicles in mature markets will slow due to rising interest rates and inflation and the overall economic situation is uncertain. The best performance of the entire light vehicle market in 2023 will be a year of low-single-digit moderate growth. The price of electric cars will also rise in 2022 as materials and manufacturing costs generally rise. The average price of electric cars in the United States in 2022 is about $65000 (CTOnews.com note: 61000 euros), and there are not enough potential customers in this price range. Because American consumers don't have many other models to choose from. Chinese car companies have done their homework on electric vehicles, not only to meet the needs of all customers, but more importantly, to meet the budgets of all customers. The top-selling Wuling Hongguang Mini EV, for example, starts at 33000 yuan (CTOnews.com note: $4800). Since its launch in mid-2020, the model has sold a staggering 1 million vehicles, and although there are many similar models launched by competitors, none of them can match it. By contrast, European customers have a wider choice of models, including popular compact cars. But in terms of price, European consumers are only willing to accept a premium of about 25 per cent for electric vehicles, including Europe's most popular Peugeot 208 electric version.

To sum up, although the market is not yet saturated, the growth of electric vehicle sales will slow in 2023 due to the lack of electric versions of some cars, the gap between the price of electric vehicles and fuel vehicles, and a weak economy. Electric vehicle subsidies have been removed in many markets. In addition, it is very difficult to maintain a growth rate of more than 50% all the year round.

Referenc

Overview of Electric vehicle Market Trends in 2023

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