• The top three brands, Tesla, BAIC Group and BYD Auto accounted for 40% of total EV sales during Q3 2019.
• Subsidy reductions in China continued to adversely affect sales.
• EV Sales declined in China and the US, but Europe experienced high growth.

Exhibit 1: Global Passenger Electric Vehicle Market Share by Brand (%) - Q3 2019

Commenting on the market dynamics, Soumen Mandal, Research Associate, said, “Reduced incentives and economic uncertainty in China heavily affected EV sales during the quarter. The latest subsidy cut in the country began in June when the government reduced the EV subsidy by 50%, adversely affecting sales during Q3 2019. Moreover, pressure on automakers to upgrade their technology to meet national standards reduced the number of new vehicles launches, which had a further effect of cooling demand. China is planning to cut subsidies completely from 2020 for new EV purchases will see slower growth in the next few years. Reduced subsidies are impacting local Chinese manufacturers, such as BYD, which has already seen deep cuts in its sales volume in 2019. A more measured reduction in subsidies would help the EV market in China adapt to the new pricing situation more easily.”

Exhibit 2: Top 5 Electric Vehicle Models during Q3 2019

Commenting on the brands’ performance, Senior Analyst, Aman Madhok, noted, “Increasing overseas sales helped Tesla to increase its market share in the global EV market. The company is focusing on further increasing its foothold in Europe and China by setting-up new battery manufacturing plants in Berlin and Shanghai.” Aman adds, “Following the reductions in local subsidies by the Chinese government, the big Chinese brands are looking to expand in global markets to improve their scale. Lower priced Chinese EVs are expected to do well in developing countries, but they face challenges in terms of safety, in-car experience and brand perception. Without an improvement in the China market situation, Chinese EV makers will likely face consolidation.”   Key Takeaways:

• Tesla sales grew 19% YoY, reaching 97,000 units, taking 20% of global EV sales. A 40% YoY increase in Model 3 sales due to strong overseas expansion drove Tesla’s performance.
• BAIC Group grew by 50% YoY, reaching 47,000 units (despite a slowing China market) due to a better performance of the upgraded Senova, EU and EX series.
• BYD EV sales were down by 30% YoY globally, reaching 45,000 units due to the revised New Energy Vehicle (NEV) policy in China.
• China is the largest EV market, accounting for 48% of global sales in Q3 2019. But new EV sales decreased by 16% YoY.

*Definitions The report includes pure electric vehicles (also known as battery electric vehicles – BEVs) and plug-in hybrid electric vehicles (PHEVs). Hybrid electric vehicles (HEVs) are not included in the study. Counterpoint Research tracks model-level EV sales in 55 countries worldwide.   Analyst Contacts: Aman Madhok +91 9560384548 [email protected] @madhokaman  Soumen Mandal +91 8218140908 [email protected] @passtubul  Vinay Piparsania +91 9971005882                                                                                                                                                                       [email protected] @VPiparsania  Neil Shah +91 9930218469 [email protected] @neiltwitz  Counterpoint Research                                                                                                                                            [email protected] @CounterPointTR