New energy vehicles are developing in a polarized manner, and the auto market has entered a wait-and-see period

June 12 is the last day of the transition period for the "Notice on Adjusting and Improving the Financial Subsidy Policy for the Promotion and Application of New Energy Vehicles" (hereinafter referred to as the "New Policy") issued by the Ministry of Finance. Starting from June 12, the New Policy will provide subsidies according to the new standards. New energy vehicles with long mileage will enjoy higher subsidies, while new energy vehicles with a range of less than 150 kilometers will be exempted from subsidies. On June 9, a Beijing Business Daily reporter visited the auto market and found that the new energy vehicle market has entered a wait-and-see period. More low-mileage models have begun to be promoted, while high-mileage models are waiting for the market to explode after the new policy subsidies are implemented.

Subsidies for low mileage are reduced

According to the new policy released in February this year, the new subsidy standard will be in transition period before June 11. During the transition period, new energy passenger cars registered will be issued at 0.7 times the standard of 2017. The new policy has a clear division of range. Pure electric vehicles with a range of less than 150 kilometers will no longer enjoy subsidies. The subsidies for models with a range of 150-300 kilometers will be reduced by 20%-50%, and the subsidies for models with a range of more than 300 kilometers will be increased by 2%-4%. Subsidies clearly tend to favor models with long range.

For example, if you want to buy a pure electric passenger car with a range of 300 kilometers, the maximum subsidy you can get in 2017 is 44,000 yuan, and the maximum standard in 2018 is 34,000 yuan; for vehicles with a range of more than 300 kilometers, you can get a subsidy of 45,000 to 50,000 yuan after the new policy is implemented, which exceeds the maximum subsidy of 44,000 yuan in 2017.

In addition, the new policy in 2018 also made a series of classifications on the energy density of power batteries. The minimum requirement for the energy density of the battery system was increased from 90Wh/kg in 2017 to 105W/kg. In addition, if you want to obtain 1 times the standard subsidy, the energy density of the battery pack needs to reach 120Wh/kg, which is nearly 30% higher than before.

Industry experts pointed out that the new policy is in line with the development trend of new energy vehicles in China. It will gradually eliminate low-endurance and low-tech automobile products, and focus more resources on new technologies and new fields. At the same time, it will also urge automakers to develop and produce vehicles with higher energy efficiency and longer endurance.

A BYD new energy vehicle dealer told the Beijing Business Daily reporter that "the announcement of the new policy has focused the attention of consumers and car manufacturers on vehicles with long mileage. Consumers will first ask about the vehicle's range and then consider price factors. Manufacturers will also gradually eliminate short-range vehicles that have lost the market and increase the introduction of vehicles with long mileage."

The auto market enters a wait-and-see period

Since there is a 4-month transition period before the implementation of the new policy, many consumers have adopted a wait-and-see attitude during this period. Beijing Business Daily reporters visited the auto market and found that the current new energy vehicle transactions are in a sluggish period, with transaction volume much lower than before the new policy was released. "Many consumers came to see and inquire, but there was no news after that. Sales were indeed relatively low during the transition period." A new energy vehicle salesman admitted, "Most consumers tend to buy vehicles with long mileage. After learning that the new policy will increase subsidies for vehicles with long mileage, they all hope that vehicle prices will be cheaper after the new policy is implemented. However, according to manufacturers, vehicle prices will not fluctuate too much before and after the implementation of the new policy, and will basically maintain the current price."

In order to alleviate the unfavorable sales situation during the transition period, Beijing Asian Games Village Auto Market and several new energy vehicle dealers held the "2018 Beichen Asian City New Energy Vehicle Exhibition and Sale" at Beichen Asian Games Village Auto Market from June 9 to 17. A person in charge of the exhibition and sale revealed, "We hope that consumers can better understand the purchase policy at this point when the new policy begins to be implemented, so that consumers can choose vehicles with confidence. At present, there are many more consumers who come to consult than before, and we hope to sell more cars before the new policy is implemented."

A Beijing Business Daily reporter found that dealers are clearly promoting sales on models with low mileage. A dealer on the scene told the Beijing Business Daily reporter that they will offer cash discounts of 2,000 to 3,000 yuan for models with a range of less than 300 kilometers.

Yan Jinghui, an expert from the Expert Committee of the China Automobile Dealers Association, said that it is normal for sales to decline during the transition period. Many consumers do not know the specific content of the new policy and will take a wait-and-see attitude. At the same time, since the quota period for new energy vehicles has been extended to one year, it also gives consumers more time to choose. This situation will gradually improve in the second half of the year. In addition, dealers' regulation of vehicle prices before and after the implementation of the new policy is also a major factor. If the price does not change much, consumers can choose vehicles according to their actual needs without considering the price factor.

Waiting for the third quarter to pick up

In fact, despite the change in subsidy policies this year, the new energy vehicle market has not declined. Before the new policy was issued, pure electric passenger cars ushered in a sales peak in January this year, as the industry had already known in advance that subsidies would decline in 2018. Data showed that new energy vehicle sales in January 2018 were 38,500, a year-on-year increase of 431%. After entering the transition period, although some consumers in the market showed a wait-and-see attitude, production and sales still showed a gradual strengthening. According to data released by the China Passenger Car Association, my country's new energy passenger car sales in April were 72,000, a year-on-year increase of 136%, and further increased to 92,000 in May, a year-on-year increase of 140%; pure electric accounted for more than 80%, reflecting the development momentum of new energy passenger cars after the policy became clear.

A consumer who came to Asia City to buy a new energy vehicle told the Beijing Business Daily reporter, "I prefer vehicles with a range of more than 300 kilometers. This mileage can fully meet the needs of daily commuting or short trips. I heard that the new subsidy policy will be implemented soon, and I hope the price will be cheaper. In addition, the new energy vehicle quota period has now been changed to one year, so I am not in a hurry to buy a car. I can wait and see the price changes for a while or wait for the launch of new products."

A person in charge of a new energy vehicle dealer in Asia City predicted, "After entering the new policy period, consumers will end their wait-and-see state and start purchasing vehicles according to their actual needs. In previous years, since the new energy vehicle quota period was half a year, consumers would concentrate on purchasing vehicles before August 26, and sales in July and August would account for 80% of the annual sales. This year, the quota period has been extended to one year, and consumers will take longer to buy vehicles. However, since there is nothing for consumers to wait for in the second half of the year, based on the start of school and purchasing habits, there will be a hot selling period in the 'Golden September and Silver October'."

Industry experts also said that for consumers who need to buy a car, if they do not have too high requirements for the range and only use it for commuting, it is best to buy it before June 12. Consumers who require a range of more than 300 kilometers can buy it after the new subsidy policy is implemented on June 12, with greater discounts and cheaper prices.

In Yan Jinghui's view, after the new policy was smoothly implemented, consumers were reassured about the ups and downs of prices, the market will gradually pick up, and sales may continue to rise in the next few months. The new policy provides the highest subsidy for vehicles with a range of more than 400 kilometers, which also forces manufacturers to abandon low-range vehicles and focus resources on improving "quality", developing vehicles with long range and high energy efficiency, and promoting the development of China's new energy vehicles in a more optimized direction.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.