Massive number of Chinese auto customers are moving to hybrids, ditching their EVs

Aug. 30, 2024, 5:28 a.m.

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A significant transformation is occurring in China's automotive market, with a growing number of consumers favoring hybrid vehicles over purely electric cars. This trend is driven by a combination of factors, including concerns about driving range, cost considerations, and the economic challenges faced by many buyers.

The China Passenger Car Association (CPCA) reports that nearly half of all new EV sales this year have been hybrids, reflecting a notable shift in consumer preferences.

In July, major automakers including BYD, Volkswagen, and Toyota sold a combined 396,000 hybrid vehicles to consumers in mainland China. This remarkable figure accounted for 45.1 percent of all electric vehicle (EV) sales, representing a significant increase from the 34.3 percent recorded in the same month last year.

Hybrid vehicles, which can run on battery power for short distances and switch to fuel for longer journeys, are becoming popular with young, first-time car buyers who find them more affordable, especially with a slower economy.

The economic situation in China has made consumers more careful with their spending. Retail sales in the first half of the year only grew by 3.7 per cent, which is much slower than the national economic growth rate of 5 per cent. This cautious spending behavior has increased the demand for hybrids, seen as a more cost-effective option compared to pure EVs.

Hybrids, including battery electric vehicles (BEVs) that use a small internal combustion engine to increase their range, are about 10 per cent cheaper than fully electric cars, making them appealing to people on a budget.

Government support is also playing a part in this change. Hybrid vehicles benefit from tax breaks and subsidies when people replace their gasoline-powered cars, as part of Beijing's larger effort to promote clean energy and its long-term goals for zero emissions.

The reliability of hybrids in tough conditions, like winter weather, has made them even more popular. Earlier this year, videos of electric cars stuck in a snowstorm in Hubei province went viral, highlighting worries about fully electric vehicles for long trips.

Advertisement In response to the growing demand, manufacturers are increasing their hybrid offerings. BYD, the world's leading EV maker, recently introduced new models like the Qin L and Seal 06, which feature advanced plug-in hybrid technology.

These vehicles can travel up to 2,100 kilometers on a single charge with a full tank of gasoline, addressing concerns about range limitations. Competitively priced, these models offer an attractive alternative to traditional fuel-powered vehicles from brands like Volkswagen and Toyota.

Although hybrid car sales are currently booming, some industry experts think this trend might not last. The long-term vision is still focused on fully electric vehicles, especially as China keeps pushing for transportation that doesn't produce emissions.

Advertisement However, for now, the demand for hybrids is robust, and even high-end EV manufacturers like Zeekr, Avatr Technology, and Hozon New Energy Automobile are expanding their hybrid offerings to capture a larger portion of the market.

Globally, hybrid vehicles are also gaining popularity, accounting for 60 percent of new EV sales in May. In China, the combined sales of hybrid and fully electric cars represent about 65 percent of the global total, highlighting the country's crucial role in the future of the automotive industry. As consumer preferences continue to evolve, the Chinese market is likely to remain a key battleground for both hybrid and fully electric vehicles.

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