EV Makers Receive First-Half Jolt

Article By : George Leopold

Amid IC shortages, Chinese demand for electric vehicles is expected to double this year.

As traffic gradually returns to pre-pandemic volumes, you may have noticed among the brake lights more electric vehicles. More Teslas, an occasional Ford Mustang Mach-E, even a top-of-the-line Porsche Taycan (the supposed “Tesla killer”).

Collectively, those sightings represent an estimated 160 percent increase in global EV sales during the first half of this year. Not bad considering lingering supply chain constraints, notes industry tracker Canalys. By comparison, the total global vehicle market rose only 26 percent during the same period, reflecting continuing component shortages, especially chips.

The huge first-half jump in EV sales was fueled—or should we say charged—by robust Chinese demand. Canalys estimates 1.1 million EVs were sold in China between January and the end of June. That’s nearly as many as total EV sales for all of last year.

“Only 6 percent of cars sold in 2020 in Mainland China were EVs – it will be more than double that for full-year 2021,” said Chris Jones, chief analyst and vice president of automotive and e-mobility at Canalys.

Emerging Chinese EV makers, including Aion, BYD, Li Xiang, NIO and Xpeng, are seeking to transform the Chinese market as Tesla has done in the U.S. The Chinese entrants have identified an emerging niche, Canalys reckons: Four of the top 10 EVs sold during the first half of 2021 were “small city cars.”

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Despite all the Tesla’s on American roads and surging demand for EVs in Chinese cities, Europe still leads in EV adoption: battery EVs and plug-in hybrid EVs accounted for 15 percent of new car sales in Europe. More than 80 percent of new car sales in Norway were EVs.

China is not far behind at 12 percent of new purchases. Surprisingly, EVs made up just 3 percent of U.S. car sales during the first six months of this year.  “One of the reasons for the slow uptake of EVs in the U.S. is limited vehicle choice, noted Sandy Fitzpatrick of Canalys.
“But carmakers are set to launch the first EVs in the hugely popular pick-up truck segment in the U.S. soon. If they’re successful, the perception of EVs should quickly change.”

For now, Tesla remains the world’s EV leader with about 15 percent of the global market, aided by production facilities in the hottest market: China. VW Group (13 percent) benefits from strong European demand for EVs. The current chip shortage has created a backlog of orders for VW and other EV makers.

Sustaining current EV sales won’t be easy as long as chip shortages persist. At least one European automaker is taking steps to shore up its component supply chains with capacity agreements.

“The challenge for the carmakers is keeping up with EV demand during the component shortage crisis,” Fitzpatrick said.

This article was originally published on EE Times.

George Leopold has written about science and technology from Washington, D.C., since 1986. Besides EE Times, Leopold’s work has appeared in The New York Times, New Scientist, and other publications. He resides in Reston, Va.


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