On October 10, Shanghai authorities issued a new policy regarding new energy vehicles. From January 1, 2023, consumers who buy plug-in hybrid vehicles (including extended-range models) will no longer be issued special license quotas. This means that consumers will no longer enjoy the benefits of free license plates, and will instead need to participate in fierce license plate bidding alongside fuel-based vehicle buyers.
Due to production capacity and delivery schedule factors, some vehicle models may last until next year. In addition, with the influence of certain policies, some Shanghai car sellers are unable to deliver vehicles due to production capacity problems, and have decided to suspend new orders for plug-in hybrid models.
The new policy will have an impact on BYD’s sales in Shanghai. According to the latest sales data in September, BYD sold 106,000 DM models, accounting for 52.68% of the total sales in September. According to Jiemian News, a dealer of BYD’s Dynasty 4S series in Shanghai said that the firm’s Han DM model is ready to suspend orders, and it is expected that it will not catch up with the licensing time at the end of the year. BYD has some Qin DM cars in stock, while the Tang DM can accept orders and get licensed at the end of this month.
Also affected are new energy automobile brands such as Li Auto and Huawei-backed AITO, which focus on extended-range cars as their main products. However, dealers of both brands told Jiemian News that the new policy’s impact is limited. A Li Auto salesman said, “The sales volume in Shanghai only accounts for 6% of the brand’s sales volume in China.”
Li Auto is also planning for its layout in the pure EV sector. According to information disclosed by Li Xiang, the CEO of Li Auto, in a telephone conference for its Q2 financial report this year, the company’s first pure electric model will be launched next year.
The dealers of AITO also indicated that, compared with Shenzhen and other places in China, Shanghai is not its main area as the local share of sales is not high. Moreover, the AITO M5 EV has been released, and the company will focus more on the sales of pure EVs later.
Under the influence of the new policy, the sales volume of plug-in hybrid models in Shanghai may see an increase in the fourth quarter. Besides, car companies mainly engaged in plug-in hybrid and extended-range models are expected to adjust their sales policies in Shanghai.
In addition, since Shanghai is now taking the lead in eliminating plug-in hybrids’ and extended-range models’ access to free electric vehicle license plates, there may be other regions in China to follow up with similar moves.