50% of surveyed Chinese car buyers would opt for an EV as market moves into high gear

At least half of the 1,000 surveyed Chinese urban consumers are looking to buy an electric vehicle (EV) as their automotive purchase, an increase of 16% from the 2019 findings, a survey by consultants AlixPartners found. It’s the latest sign of an accelerated transition from gasoline vehicles in the country.

Why it matters: China’s EV market is recovering faster than expected following subsidy cuts by the central government and a shakeout due to the pandemic.

• One out of five new vehicles sold in China in September was a new energy vehicle (NEV), referring to battery-powered cars, plug-in hybrid cars, or hydrogen cars. The NEV penetration rate now exceeds 20% of all new car sales for the first time, data from China Association of Automobile Manufacturers (CAAM) show.
• At this pace, China has already met, at least in the month of September, the target it set to be reached by 2025 — NEVs accounting for 20% of new car sales — Stephen Dyer, managing director of AlixPartners, told reporters in Shanghai on Thursday.

Details: The survey of 1,000 Chinese car buyers in major cities found that 50% are now believers of all-electric vehicles, meaning they are very likely to buy one as their next vehicle; that is double the world average of 25% and the highest share among potential car buyers surveyed in seven countries by AlixPartners. 

• The 2021 survey released Thursday covered about 8,100 respondents from seven countries, including China, France, the UK, and the US. The approximately 1,000 surveyed in China lived in large cities, with roughly half aged between 36 to 55, the research firm said. 
• Also, over 99% of current Chinese all-electric owners remain highly satisfied with their purchase and expect to buy an EV again as their next auto purchase, which is 2% above the global average, according to the AlixPartners survey.
• Chinese consumers are motivated to buy EVs as more of their acquaintances recommend them. 26% of those all-electric car believers say friends and family are their biggest influences on their purchases, compared with 11% of those not interested, the report said.
• AlixPartners consultants advise that more “grassroots” marketing channels such as greater use of social media could connect likely buyers to current all-electric car owners and significantly influence their purchase decisions, potentially resulting in a “network effect” growth of sales.

Context: China’s NEV sales almost tripled to more than 2.15 million vehicles from a year ago during the first nine months of this year, according to CAAM figures.

• Xu Haidong, chief vice engineer of the industry association, last month expected the country’s NEV sales to surpass 3 million units this year, more than double the 1.4 million sold last year, Reuters reported.