The world’s largest car market is rapidly going electric, and automakers risk losing sales if they don’t follow suit, climate campaigner Greenpeace said in a report.
Volkswagen AG could lose 3 to 7 percentage points of its China market share by 2030, while General Motors Co. could see its erode by 3 to 6 points as their fossil fuel-powered cars lose popularity, according to Greenpeace. The firms combined for about 30% of car sales in China from 2019 to 2021. Meanwhile Chinese firms with a heavier emphasis on EVs stand to gain.
“The era of gas and diesel vehicles is coming to an end, and EV sales are surging,” said Greenpeace East Asia campaigner Bao Hang. “Rapid electrification is necessary to stay relevant in China’s auto market.”
China accounts for more than half the world’s EV sales, and BloombergNEF expects drivers to buy about 8 million electric automobiles this year, up from about 6 million last year.
Greenpeace said Chinese automakers it surveyed all have at least 30% of their production capacity dedicated to new energy vehicles, led by BYD Co. with 100%. BYD overtook VW as China’s top-selling car brand in the first quarter. Major foreign automakers, on the other hand, are all at 30% or below. If they don’t begin transitioning their factory lines to new energy vehicles, they could be left with heavy amounts of unused capacity in the years to come, according to Greenpeace.
Tougher emissions standards that come into effect July 1 could leave manufacturers and dealers with tens of thousands of non-compliant gasoline cars, putting pressure on legacy carmakers to clear stock.
