The team expects China's NEV sales to be around 6.11 million units in 2022, accounting for more than half of the global market share.

China Galaxy Securities expects local NEV sales to exceed 6 million next year-CnEVPost

(Data: China Association of Automobile Manufacturers. Graphic: CnEVPost.)

A local brokerage firm expects China's new energy vehicle (NEV) sales to exceed 6 million units next year, capturing more than half of the global market share, as the country's NEV penetration rate rises significantly.

China's NEV sales are expected to be around 6.11 million units in 2022, with global sales approaching 12 million units, China Galaxy Securities said in a research note released today.

In 2021, production cuts due to global auto chip supply shortages have put the industry into a mismatch where demand outstrips supply, and as the supply chain gradually recovers, total auto sales in China will rise slightly year-on-year in 2022 and are expected to reach 26.5 million units, the note said.

Robust NEV demand, as well as fuel vehicle demand being released after chip supply pressure eases, are expected to allow the entire auto industry to recover, the team said, adding that some of that suppressed fuel vehicle demand could be met by hybrid products.

As the chip shortage eases, production and sales of local brands will remain steady overall, with market share expected to rise steadily, while the median price of high-end new energy models is expected to move up as sales of luxury brands pick up, they said.

As the electric vehicle industry chain becomes more mature, the gap between car companies in battery, motor and electric control technology will gradually narrow, and intelligent driving, as well as intelligent cockpit, will become the main direction of competition among carmakers, they said.

A wide range of user groups will become the R&D base and development advantage for car companies, and user subscription payments will be an important source of profit for them in the future, the note said.

Deutsche Bank expects BEV sales in China to reach 5 million units next year