Shanghai EV sales sees strong recovery in June

Photo from CFP

In a first half dominated by lockdowns and supply chain issues, Shanghai’s EV sector expanded by a pleasing 57 percent, according to the city’s bureau of statistics. Since reopening, recovery has been rapid, demonstrating surprising resilience.

More than 300,000 EVs were sold in Shanghai in the month of June, 90,000 more than the previous June. Production and sales at major car makers, including SAIC Motor and Tesla, have quickly reestablished themselves back at pre-lockdown levels.

Flying off the lot

Jiemian News paid visits to several dealerships this week. All the showrooms were noticeably busy, with staff dealing with potential customers throughout our time there. A Li Auto salesperson said the sales center had seen plenty of interested customers since the launch of the Li L9 SUV on June 21. The smart SUV is a six-seat, full-size SUV, offering excellent space and comfort for families with a range of over 1,000 kilometers and a WLTC range of 1,100 kilometers. Priced at 460,000 yuan (US$70,000), the vehicle is far from cheap – the Tesla Y costs around US$50,000 - but will be delivered in August. “We have taken around 30,000 orders in just three days,” the salesman told us. He himself hopes to sell 50 cars this month.

The Li model ONE is still the best seller, he said. Li Auto delivered 13,000 of them in June, 69 percent more than the same period last year.

When we arrived at our chosen Tesla dealership lunch hour was in full swing and the showroom was as busy as any local restaurant or coffee shop. All four salespeople have fully occupied fielding inquiries, though how many visitors were potential customers, and how many were mere sightseers was hard to say.

We were told that the dealership has seven cars available for test drives, but all appointments are booked every day for the foreseeable future. Many people are trying to take advantage of a government stimulus measure, which offers an incentive of 10,000 yuan for anyone who trades in a gasoline car for an EV before the end of the calendar year.

Thank the stimulus

Tesla is close to becoming a victim of its own success. The Shanghai factory, which makes Model 3 for both exports and the domestic market, is operating close to full capacity. Despite production being very close to current limits, buyers still have to wait for up to twenty weeks for delivery. “If you count in the wait for a license plate, it comes quite close to the December 31 deadline. So everyone is buying right now,” a salesperson told us.

Tesla delivered 295,000 units in China in the first half of this year. That’s more than half of the company’s global total. The Shanghai factory is now Tesla’s largest and most impressive. Production hit a record high in June, and the Gigafactory is expected to make more than 750,000 cars this year.

“The stimulus policy has played a crucial role in driving up demand,” said Cui Dongshu, secretary general of the China Passenger Car Association. “Market performance is sure to be strong in the second half of the year.”

Different lockdown, same recovery

Other cities that have been affected by Covid outbreaks, such as Hangzhou and Shenzhen, have also seen strong recoveries in EV sales. Car markers now face increased pressure to keep up with demand. A BYD representative explained that many models are already out of stock in Shanghai. The waiting time has become so long in some cases that dealerships have been forced to stop taking new deposits.

In response to an inquiry from Jiemian News, a Nio spokesperson said that production had recovered to normal levels in June and that a new plant is scheduled to start operating in Q3. SAIC Motor said it has been “closely monitoring the situation to ensure a quick delivery.”