Electric Cars: The Dominance of Sedans in the EV Market

As of 2024, the domestic market for new energy vehicles (NEVs) has witnessed an impressive performance, with annual production and sales surpassing the 10 million mark for the first time. The penetration rate of the new energy passenger car market has consistently exceeded 50% for several months. Given this momentum, a curious question arises: Will the growth of electric vehicles (EVs) continue at this vigorous pace into 2025?

The answer seems promising, with several automotive companies not only meeting but exceeding their sales targets. Notable among these are seven car manufacturers: BYD, Chery, Geely, Li Auto, Xiaomi, Leap Motor, and Bestune.

BYD leads the charge in the battery car segment with annual sales reaching 4.2721 million vehicles, marking a 41.26% year-on-year increase. This cements BYD's position as the sales champion in both the Chinese car market and the global new energy vehicle market. Following closely, Chery sold 2.6039 million units, a 38.4% increase, setting a new record for the company. Their revenue exceeded 480 billion yuan, marking a growth of over 50%. Chery's electric vehicle sales reached 583,600 units, demonstrating a remarkable 232.7% increase.

Geely, another major player in the automobile sector, achieved a new high with 2.1765 million cars sold, experiencing more than a 32% growth. The company surpassed its annual target of 2 million with a noticeable boost in EV sales, which accounted for 888,235 units, a 92% increase from the previous year. Li Auto made history as the first among new EV startups to deliver over 500,000 units annually, reaching 500,500 deliveries in 2024, reflecting a 33.1% growth. Their December figures alone topped 58,513 units, setting a new monthly delivery record.

Xiaomi Auto also reported impressive results, with a total of 135,000 deliveries, surpassing their initial goal of 130,000 units. Leap Motor, meanwhile, achieved its annual target of 250,000 by November, ultimately reaching nearly 300,000 units, which signifies a 128% increase. Amid the growing competition, Leap Motor has launched a new promotion, offering substantial cash incentives and purchase benefits to attract more buyers.

Not all companies, however, reached their sales targets. NIO and Zeekr exceeded 90% of their goals, while DeepBlue, Lantu, and Avatar achieved over 80%. Seres, known for its electric sedan and pickup models, recorded sales of 426,885 vehicles, achieving about 71.15% of its 600,000 target. XPeng delivered over 190,000 cars but fell short of its ambitious 280,000 target with a completion rate of 67.88%. IM Motors also struggled, with only around half of its target achieved, selling 65,505 units instead of the 120,000 to 130,000 projected.

There were companies facing even more significant challenges. Neta Auto encountered operational difficulties and management upheavals, while Jishi Auto's niche luxury electric vehicle encountered lukewarm market reception, reflected in its low sales numbers. Skyworth, despite decent sales numbers, faced skepticism over its marketing claims, which failed to garner sustained brand recognition. Feifan saw a decline, with only 5,775 units sold in the first three quarters, sharply contrasted with its previous year's total of 20,000.

In the coming year, the outlook for new energy cars appears both challenging and opportunistic. The dual challenge of rapid sales growth and innovation remains. Zhang Yongwei, Vice Chairman and Secretary General of the China EV100, predicts domestic new energy vehicle sales could reach 15 million in 2025, potentially climbing to 16.5 million globally, with a growth rate around 30%. In addition to fully electric vehicles, hybrid technologies that combine electric and combustion engines are expected to play a significant role in this growth.

Cui Dongshu, Secretary General of the Passenger Car Association, anticipates a 2% growth rate in the domestic auto retail market with an initial slow phase followed by a higher increase later in the year. LanTu Auto's CEO, Lu Fang, projects a 60% penetration rate for electric vehicles in 2025, building on the substantial increase witnessed in 2024.

Analysts, including those from the Financial Times, believe China's new energy vehicle sales could surpass 12 million by 2025, outpacing international forecasts and previous projections. Meanwhile, traditional vehicle sales are expected to drop below 11 million, marking a significant decrease from 2022.