By Kandy Lin, analyst of VehicleTrend, TrendForce
As the awareness of energy saving and carbon emission raising, the automotive industry has shifted from conventional gas-powered cars towards hybrid and new energy vehicles. The USA, Germany, Japan and China are the major players in the global new energy vehicle field and their technical routes varies based on their specific conditions.
The application of engine decreases as electric motor gains momentum. The development trend of global hybrid vehicles are: 48V weak mixing hybrid--Non-plug-in hybrid -- Plug-in hybrid electric vehicle (PHEV)-- Extended PHEV.
Non-plug-in hybrid vehicles dominates in the USA, Japan and Europe as auto regulations advances
On one hand, subsidies for pure-electric vehicles and PHEV are limited, and non-plug-in hybrid cars are cheaper in comparison. On the other hand, the carbon emission policies in the stated markets allow more room for automakers and the auto market to develop. Moreover, no compulsory requirements of sales ratio of pure-electric vehicles and PHEVs stand in the way. Therefore, non-plug-in hybrid cars thrive in these markets.
According to HybridCards, Japan’s hybrid car is the most developed, accounting for 38% of its home market. The sales of non-plug-in hybrids in the USA and Europe also hit hundred thousands units, which doubles the sales of pure EV and PHEV combined. The 48V system allows a 20% deduction of carbon emission and it will maintain to be the mainstream hybrid technology by 2025.
Aggressive NEV policies in China
Unlike its counterparts, China gives not much support to the development of non-plug-in hybrid vehicles, and such cars are not a preferred options for customers either. As a result, Chinese automakers include few non-plug-in hybrid cars in their lineup and Toyota or joint ventures become the major force for the promotion of this kind of cars. In 2017, the sales volume of non-plug-in hybrid cars in China reached 137,600 units, where Toyota is the winner.
In China, the subsidies for pure-electric vehicles and PHEVs are more than that for non-plug-in hybrid vehicles. Moreover, the dual-scoring policy demands certain sales ratio of pure-electric vehicles and PHEVs of the total. Even though the non-plug-in hybrid cars meet with the carbon emission standards of fossil fuel cars, automakers manufacturing the cars still need to buy NEV credits. Thus, we can conclude that the advancement of NEV in China is largely backed by favorable policies by Chinese government.
Sales volume of PHEVs and pure-electric vehicles (Jan.-Nov. 2017)
The sales volume of PHEV accounts for 20% of the total of NEV sold in China during January to November in 2017, and the rest 80% are pure-electric vehicles. From the chart, we can see that over half of the total are A00 all-electric cars, which suggests low-end technologies and reliance on NEV subsidies. However, Chinese government has already made adjustments to the subsidy policy and eliminated subsidies for short-range A00 EVs. The move signals China’s determination to improve R&D capability, auto technologies and decrease reliance on technologies from Japan, Europe and the USA.
Bottleneck for the advance of hybrid vehicles: Battery & BMS
China needs to catch up with its counterparts in the developemnt of traction battery and battery management system(BMS). Batteries used in hybrid cars have higher C-rate and are more sensitive to temperature, which impose challenges for the design and performance of BMS. Today, Chinese battery makers are still incapable to mass-produce battery cells for hybrid cars, therefore, manufacturing facilities are in short.
The energy density of batteries has been constantly increased to a level that meets public’s demands in terms of driving range and power. In this case, BMS plays an important role to secure safe driving. To date, about 90% of BMS technologies is in the hands of foreign companies, so China has to keep up in the race and makes breakthroughs in battery and BMS.
48V system becomes popular in car electrification
As cars are increasingly electrified and 12V system failing to meet the power demand of hybrid cars, 48V system and dual voltage architecture 12/48V system are gaining momentum in terms of performance and costs. Though 48V system is still in initial stage in China, a technical roadmap of NEV has been drafted by Chinese auto engineers, which requires electrified vehicles to adopt effective hybrid system and economic efficient and generalized components. Then, we can estimate that about half of the cars newly launched in China is to install 48V system, especially compact cars and mid-size cars.
Different strategies to address technical bottlenecks and to comply to dual-scoring policy
Joint venture automakers introduce both 48V weak-mixing hybrid cars and the more mature strong-mixing non-plug-in hybrids into the Chinese market. For example, Volvo claimed to stop producing gas-powered car from 2019 and will adopt 48V system. Toyota introduced Corolla Hybrid and Levin HEV to China. However, the sales of non-plug-in hybrids won’t contribute much to meeting with dual-scoring policy. As a result, foreign automakers pair up with Chinese automakers to focus on the development of pure-electric vehicles.
Chinese automakers continue to develop pure electric vehicles to offset negative scores of the sales of fossil fuel cars. As 48V system has not been popularized yet, its application is expected to increase 10%-20% per year. During the phase-out of NEV subsidies, automakers are eyeing not only long-range EVs but the more efficient PHEVs. 48V system could become a standard part in gas-powered car.
Sales volume of hybrids in China could hit 2 million units in 2020
Energy-saving and New Energy Roadmap indicates that the sales volume of hybrids will account for 8% in 2020. According to the specific condition in China, the sales volume of hybrids will exceed 2 million units in 2020. If the problem of electricity source is addressed, pure EV will be the mainstream car. If not, hybrid vehicles will have strong momentum in the next 5-8 years. Therefore, Chinese automakers should join hands with parts suppliers to make breakthroughs for hybrids and to enable auto technologies to reach international standards.
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