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'New Energy Vehicle' Insurance Registrations in China Show Tesla is the Top Selling Brand Over EV Startups

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【Summary】For the month of February, consumers in China purchased Mandatory Liability Insurance for 18,039 China-made Tesla vehicles. Of the 18,039 Tesla vehicles registered, 13,394 were Model 3 sedans and 4,645 were Model Y crossovers. The new Tesla registrations in February are more vehicles than China’s six leading EV startups combined, including NIO, XPeng and Li Auto.

Eric Walz    Mar 29, 2021 1:25 PM PT
'New Energy Vehicle' Insurance Registrations in China Show Tesla is the Top Selling Brand Over EV Startups
A customer and a sales associate inside a Model Y during a test drive at a Tesla showroom in Shanghai. (Photo: Qilai Shen/Bloomberg)

There is no doubt that electric vehicle pioneer Tesla Inc. is facing growing competition in the electric vehicles space. Since the Model S was launched in 2012, Tesla faced little competition from the world's legacy automakers, but that is now changing with a new crop of EVs coming from Volkswagen, BMW, General Motors and Ford Motor Co., along with many others.

In China, which is the world's biggest auto market and an important one for Tesla, the company's biggest rivals at the moment are EV startups NIO Inc., Xpeng and Li Auto, which offer more affordable EVs that are equally as advanced. All three EV startups are publicly traded companies in the U.S.

But so far, Tesla has managed to hold on to the number one spot as the top EV brand according to new insurance registration data for February released by the China Insurance Regulatory Commission (CIRC).

The insurance registrations were reported by Chinese automotive news outlet Gasgoo.

Last month, consumers in China purchased Mandatory Liability Insurance (MLI) for 93,680 China-built "new energy vehicles" (NEVs), a surge of 841% over the previous year, according to the China Insurance Regulatory Commission (CIRC). Many of the MLI policies were purchased for Tesla vehicles.

NEVs in China include plug-in hybrids and fully-electric models.

For the month of February, consumers in China purchased MLI for 18,039 China-made Tesla vehicles. Of the 18,039 Tesla vehicles registered, 13,394 were Model 3 sedans and 4,645 were Model Y crossovers, which is more than China's leading EV startups combined. 

With Tesla leading in MLI purchases, the rest of the market share was dominated by six other companies; NIO, XPeng, Li Auto, WM Motor, HOZON Auto and Leapmotor.  The six companies' MLI registrations totaled 12,445 units.

For the month of February, Tesla China achieved a growth rate of 9.2%, mostly due to growing demand for the Model Y, the California company's second vehicle being built in China. The Model Y had an insurance registrations of 1,967 units in January, which more than doubled in February.

For the first two months of 2021, the NEV insurance registrations totaled 239,136 units in China, representing a year-over-year increase of 346.6%. Of this amount, 16% came from EVs purchased from one of the other six Chinese startups, including Nio, Xpeng and Li Auto.

The uptick in insurance NEV registrations comes as China recovers from the global pandemic of last year, which resulted in declining auto sales as many consumers were under lockdown.

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Tesla is leading in new energy vehicle insurance registrations in China for 2021. (Data from Gasgoo)

Tesla's China Rivals Nio, Xpeng and Li Auto Experienced Declining Sales in February

However as Tesla's sales rise in China, Nio posted a month-on-month decrease of 20.2% for February for all three of its electric models. The ES8 and ES6 SUVs and the EC6 sedan had an insurance volume of 1,351 units, 2,277 units and 2,111 units respectively, of which the EC6 recorded the biggest month-on-month drop.

Xpeng saw its monthly registrations fall over 50% from 5,542 units in January to 2,332 units in February. Xpeng's February insurance registrations included 880 G3 SUVs and 1,452 P7 sedans. The P7 was launched in April 2020.

Guangzhou-based Xpeng is leading other Chinese startups in the development of autonomous driving technology. XPeng released the first over-the-air update of its new XPILOT 3.0 Navigation Guided Pilot autonomous highway driving solution beginning in January, which has become a selling point of Xpeng's vehicles in China.     

Xpeng's Navigation Guided Pilot had been activated in around 20% of all P7s delivered and has been used to travel more than 1.3 million kilometers as of the end of February, said He Xiaopeng, Co-founder, Chairman and CEO of XPeng, at the company's quarterly earnings call.

Li Auto's February insurance volume fell 53.9% compared to the previous month, although sales have surged 646.3% compared to the previous year. The EV startup currently has only one model for sale, the Li ONE range-extended electric vehicle (REEV) with a NEDC range of up to 800 kilometers. 

Li Auto said the cumulative deliveries of the Li ONE surpassed 40,000 units as of Feb. 18, only 14.5 months after launching its first vehicle. Li Auto was the first Chinese EV startup that achieved the milestone in such a short time.

Tesla also dominates electric vehicle sales in the U.S. The company sold 292,902 vehicles in the U.S. in 2020, representing a year-over-year increase of 50.1%. However new EVs are hitting the market in the U.S. in 2021, including Volkswagen's ID.4 SUV, which will give Tesla more competition than ever before in its history.

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