Energy
Friday, September 2nd, 2022 9:41 am EDT
Sweden’s auto market recorded a plugin electric vehicle share of 46.1% in August 2022, a slight drop year on year from 47.1% share. Full electrics grew their share, but plugin hybrids lost more. Overall auto volumes were 26% down on pre-pandemic seasonal norms, at 20,576 units. The Volkswagen ID.4 was the best selling full electric in August, and 2nd ranked auto overall.
August’s 46.1% combined plugin result comprised 28.3% full electrics (BEVs), and 17.8% plugin hybrids (PHEVs). This compares to respective shares of 24.1% and 22.9% a year ago.
In unit volume terms, BEV grew 21.6% YoY, while PHEVs shrank 19.6%. This combined to a 1.5% YoY volume growth for plugins, against the overall market’s 3.6% growth (and thus a slight loss of plugin share). The changing fortunes between the two varieties of plugin are the result of changed incentive policies which we discussed in the June report, and in the July report.
Year to date plugin volume is still growing — up 10% YoY, with BEVs up 68%, a strong growth rate. The relative strength of BEVs, and plateauing (and perhaps now cooling) of PHEVs, can be seen in the powertrain evolution graph:
Top Selling BEVs
The Volkswagen ID.4 was the top selling BEV in August, and 2nd best seller overall, just behind the Toyota RAV4. The ID.4 delivered 654 units, slightly above its monthly average so far in 2022.
The Nissan Leaf and MG ZS took 2nd and 3rd spots in the BEV rankings, both stepping up considerably compared to their July results.
Side note – The Toyota RAV4 (which was Sweden’s overall bestselling auto in August) delivered around 90% plugless hybrid (HEV) variants and just 10% PHEV variants in August. So far this year, Toyota holds about 8.5% of Sweden’s auto market, but 78.5% of the country’s HEV market. Indeed, 86.3% of Toyota’s Swedish sales this year are HEVs, 7.9% are PHEVs, and just 1.1% are BEVs. On the somewhat positive side, only 4.7% of Toyota’s sales are combustion-only powertrains, compared to 39.6% combustion-only share of the overall market.
Back to August’s BEV rankings, there were no completely new faces in the top 20 chart above, but relative newcomers, the MG MG5, the Cupra Born, and the VW ID.5, all had strong months and continue to climb the ranks.
To see through the ups and downs of monthly variations, let’s look at the trailing 3 month performance of the best selling BEVs:
The Tesla Model Y leads, mainly still on the strength of its big push in June. The Model Y has actually improved its position compared to three months ago (March to May), when it was ranked 3rd.
However, its sibling, the Tesla Model 3, dropped from 8th to 18th over the same period. Their relative performances may be mainly due to deferentially constrained supply; Model 3s ordered today should arrive between January and March 2023, whereas Model Ys are in an earlier December to February window. Both evidently have decent order books.
The MG brand saw two very strong climbers, the ZS and the MG5, with combined volume up 2.3x compared to March-to-May. Volkswagen Group models also saw many gains in rank, with the Skoda Enyaq, Audi e-tron, Cupra Born, and VW ID.5, all climbing.
Here’s a summary of the main climbers:
As some go up, others must go down.
The most notable decline compared to 3 months ago was the Kia Niro, which fell from 1st to 6th. However, most of this is not due to falling demand, but instead due to change over in supply from the old version to the new version. The new Niro, with updated styling and interior, improved range and charging, and vehicle-to-load capability, should resettle back near the top of the charts in due course.
I’m not quite sure what is happening with the home brand Volvo and Polestar BEVs, but they seem to be having a torrid time of it recently. Perhaps this is mainly due to temporary regional allocation decisions rather than a serious drop in demand, time will tell.
It’s worth noting that Sweden is a relatively small BEV market compared to the volumes in Germany, the UK, and France, which typically see 2.5x to 4x the quantity. So whatever may be happening locally to a given brand or model in Sweden cannot necessarily be taken to reflect the overall performance in Europe (or globally).
Outlook
Sweden’s energy mix only includes 3% natural gas, so you might expect that it escapes most of the direct impact of rocketing gas prices across Europe. However, electricity in Europe is internationally traded, and wholesale electricity recently hit a catastrophic €1,000 per MWh — or €1 per kWh. This is up over 1000% from a year ago!
Thus electricity bills have been going up steeply in Sweden also, as the country exports increasing amounts of energy to neighbours with acute shortages, and prices have risen across the board.
Food price increases — now also common across Europe — are also being felt in Sweden, and alongside energy and general supply chain constraints, have lead to a Swedish inflation rate of 8.5%, up from under 2% YoY.
This economic environment is obviously putting a squeeze on consumer sentiment, which will continue to dampen new vehicle sales. Nevertheless, even with increasing energy prices, electric transport remains substantially cheaper in long term running costs, compared with fossil fuel transport. This should mean that relative demand for plugin EVs remains stronger than for plugless vehicles.
Industrial supply chains are another issue shaping vehicle availability, according to Mobility Sweden, who have recently said of the auto market performance; “this year’s decline can mainly be attributed to the limited supply and long delivery times.”
It remains to be seen whether plugins are more or less impacted by supply issues compared to the overall auto market.
What are your thoughts on Sweden’s economic situation, auto market, and prospects for EV growth this year? Please jump into the comments section below and join the discussion.
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