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2022 Year-End Review - SAI Newsletter 46



 

Since this is the last newsletter of the year, rather than throw up a few headlines from the last week, what I normally have done is look at all this year’s newsletters to list some of the more interesting news that occurred throughout the year. Since we are at newsletter #46, we missed about 6 weeks this year - not bad, although I will work to deliver the newsletter more consistently on Wednesdays in 2023. I’ll use the excuse about COVID really wreaking havoc on my work schedule and client projects too. I don’t believe I’ll have that excuse next year but it may be replaced with a pretty full travel & conference schedule that will be global. As I travel, I’ll try to carve out some time so that I am able to meet with any readers that are up to grab a pint or coffee. Here’s to hoping that the travel complications caused by COVID are well behind us. One achievement that I am really quite proud of is the launch of the MOBILIT/E Conference in February in partnership with Climate Transformed. It was a VERY ambitious, completely digital conference that included over 65 panelists, thousands of participants and 3 keynotes over a two-week period. I’d never done anything quite like it and was very happy that the caliber of panelist was very high while the level of engagement was off the charts. We are currently working on the 2023 edition which is currently penciled in for Feb so stay tuned for many more details in the coming weeks. As for COVID, it’s still making its way across China, and I don’t see it really calming down there until at least March so perhaps an early CNY 2023 is a blessing in disguise. Many analysts, including NIO, see a weaker beginning of the year for NEV sales before picking up to close out 2023. I do NOT anticipate another 100% growth year for NEVs in China but do see higher growth in the EU and US sectors in 2023 (vs. 2022) as more investment is made to charging infrastructure and new, many more affordable EVs begin production. A reminder that in November in China, well >90% of all NEVs (BEV + PHEV +FCEV) were <¥300K so that’ll also be where the sales sweet spot will be for the US & EU. Here are some of the more notable news from 2022. I may add a few to next week’s newsletter as I am reminded of them, so this is not an exhaustive list by any means. - China maintains its title as the largest NEV market in the world for 2022 despite all the COVID challenges that caused production stoppages all over China through the year. Sales will reach close to 7M NEVs sold with the lion’s share of those vehicles sold priced <¥300K. - The city of Shanghai was locked down for two months while it battled COVID. - BYD overtook Volkswagen Group as the 3rd most valuable automotive company in the world behind Tesla & Toyota and was then overtaken by Porsche as well. The current ranking is as follows:

  1. Tesla

  2. Toyota

  3. BYD

  4. Porsche

  5. Volkswagen Group

- Speaking of Tesla: It lost about-70% of its value in 2022 and is now ~$350B company. It had gone as high a $1.2T (Trillion with a ‘T’) - COVID and supply chain issues (much of them due to COVID) wreaked havoc on the auto industry (both ICE & EV sides). - The United States passed the Inflation Reduction Act which will end up being the largest ever investment by the US govt in infrastructure and clean energy (environment) that will likely creep up well over $2T when it’s all said and done. - Berlin and Austin Gigafactories both launched and added substantial capacity to Tesla’s production which currently is adding to some of its woes. - Sales of legacy vehicles continued to struggle in China while domestic Chinese EV companies took sales away from them. Once the numbers shake out in 2022, we will likely see VW Group, GM, Stellantis, and some of the Renault brands all lose share in 2022 which makes their EV products that much more important for the China market in 2023. - VW Group invested >$2.4B in Chinese chip designer Horizon Robotics. - VW Group announced that it will begin selling Chinese made cars in Europe starting in 2024. - TSMC announced that they’d invest ~$24B to build fabs in AZ in the US to fabricate the most cutting edge chips (<3nm) - TuSimple is in some potential trouble with the US govt with both the SEC & FBI investigating potential wrongdoing. This created a domino effect with the CEO being ousted before turning around and ousting the board. TuSimple is now in survival mode with massive layoffs looming and raising capital a major priority, but who outside of potential Chinese investors wants to bail them out? - The US restricts the sale of high-end chips to China & forbids US citizens, residents and green card holders from working for any Chinese chip companies. Let’s also not forget my 2022 predictions and see how I did against them:

- A Chinese smart EV will offer 10 LiDAR Baidu is offering 8 on their RT6 robotaxi that will launch later in ’23 - A foreign legacy OEM (am thinking European) will invest in a China EV first company (notice I didn’t say startup) The closest to this was VW Group investing in Chinese chip design company Horizon Robotics - We will get to 5M units of sales for 2022, but it’s gonna take lots of OT from the materials, sourcing, and logistics folks, and a bunch of help from Wuling, Tesla, and BYD Crushed this by almost 2M units - The average price of a robotaxi will shrink to <400K RMB. It’ll trigger many more pilots and other startups to enter the space. Baidu Apollo intro’d a robotaxi that will have a price tag of ¥250K - The Detroit auto show WILL take place this September for the first time in over 3 years. AND I will be in attendance. Yes – to both - CATL will feel some growing pains CATL is a machine that did not have any major hiccups in 2022 - The Cadillac Lyriq & Ford Mustang Mach E will each sell >40K units Nowhere close for the Cadillac Lyriq. Ford produced its 150,000th Mach E in November but continues to struggle selling them in China - BYD will sell > 1.4M units next year Crushed it - So will Tesla They did too - Waymo enters China market (through a back door) Waymo announces a major partnership with a Chinese company, in this case Zeekr will build its robotaxi. Overall not too bad, I think as unpredictable as 2022 was that’s a pretty solid score I got, especially if you give me credit on a few that seemed to be ‘close enough.’ -------- Lei and I will get into a bit more detail on Friday during our last China EVs & More episode of 2022. The current plan is to broadcast live from Twitter Spaces at Noon EST so for those who are available at that time, don’t forget to tune in! Finally, there are a few things I’ve been working on here in the US that will be unveiled in the coming weeks. I’ve spent the last 4 months here and have opened an office so we are now O-ficially a global consultancy and have some potential clients lined up here in the States. It’s an exciting time to be here and I’ve already met some great people doing amazing things in the mobility space and look forward continuing to help those people and companies that are looking to make a difference here, in Europe or anywhere in the rest of the world. -------- This weekly newsletter is a collection of articles we feel best reflect the happenings of the week or important trends that have effects on the automotive and mobility sectors here and in the US, we also provide a point of view that we hope educates and sparks debate. The Sino Auto Insights Team


 

Sino Auto Insights is a Beijing, China-based market research and advisory firm that specializes in assisting companies analyze, strategize, and develop products and services that will shape the future of mobility and transportation. Members of our team have experience working in Detroit, Silicon Valley as well as here in China across multiple sectors and functions as entrepreneurs as well as working at larger companies like Apple, Google, Amazon, GM and FCA, and many others.

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