Energy
Friday, July 1st, 2022 7:03 am EDT
In June 2022 Sweden’s plugin electric vehicles took 55.1% market share, up from 49.4% YoY. BEVs grew share by over 31% YoY, whilst PHEVs reduced share slightly. Overall auto market volume, at 26,059 units, was 28% down YoY. Sweden’s best selling vehicle (of any powertrain) in May was the Tesla Model Y.
June’s combined plugin result of 55.1% consisted of 31.6% full battery electrics (BEVs), and 23.5% plugin hybrids (PHEVs). This compares to June 2021’s results of 24.1% and 25.3%, respectively. PHEVs have been relatively flat over the past two years, whilst BEVs have steadily grown share (see the long term trend lines in the graph below).
Sweden is in the midst of various incentive changes around vehicle emissions (via tweaks to the bonus-malus system), and there will be further changes activated in July. These include new company-car rules, tighter CO2 grams/km limits, and also eligibility price-cap changes. With vehicle buying variously brought forward and pulled back by these changes, it will take another few months for the landscape to settle down.
Although Tesla managed to ship some vehicles from their Shanghai factory to Europe for June delivery, volumes were still impacted by their intermittent production lockdowns in March, April and May. If no other disruptions occur, we will see a more representative picture of Sweden’s (and Europe’s) plugin share evolution at the end of this quarter (ie. September).
In Sweden’s case, we can expect plugins to score significantly above 60% share in September.
Sweden’s BEV Best Sellers
With Tesla’s Europe deliveries returning in June, Sweden’s best selling vehicle of any kind was the Tesla Model Y, with the Volkswagen ID.4 taking the 2nd spot in the BEV ranks, and the Kia Niro in 3rd.
The Polestar 2 slipped from 5th in May down 7th in June, but more dramatic was the Volvo XC40’s drop from 5th to 25th. However, many of these kinds of erratic monthly changes (both up and down the ranks) can be due to temporary regional allocation decisions, resulting from insufficient BEV supply, rather than due to changes in demand. That’s why we include the trailing 3-month chart and commentary (below).
Above is the trialing 3-month chart. We can compare these results to the trailing 3-month result up to the end of March. We find that some existing BEV models have significantly improved their rankings, and some relatively new BEV models have stepped on to the top 20 list for the first time:
Meanwhile several other, mostly older, BEV models have dropped positions (though some could be temporary, due to allocation shuffling at the country level or even continental level):
Note that, even in the 3-month window, temporary regional allocation decisions can shape the results, rather than necessarily indicating significant demand changes. Also, Sweden’s BEV volumes are only around a third or a quarter of the BEV volumes in Germany, or France, or the UK, so relative performance in Sweden doesn’t necessarily imply much (or anything) about model’s overall European performance.
Nevertheless, it’s interesting to see which models are being lapped up by the Swedish market, especially in regard to the newcomer models, whose market acceptance is never a sure bet.
Outlook
As industry representative Mobility Sweden notes, overall auto volumes have fallen off by almost 17% so far this year (144,106 vs 173,166 in 2021 YTD). With plugins growing in volume YTD (74,834 vs 69,145) and plugless hybrids almost flat (12,938 vs 13,159), unsurprisingly the big hit has been taken by combustion-only powertrains.
Combined diesel and petrol sales YTD stand at 54,624, down from 89,724 by this point in 2021. If we step back to pre-pandemic 2019, the YTD figure was 136,027. So their sales have dropped almost 60% since 2019.
Mobility Sweden has this to say about the overall auto market:
“Major disruptions in global supply chains continue to hit the automotive industry hard as a result of both the war in Ukraine and China’s shutdowns due to the pandemic. The combination of production disruptions, higher energy prices, higher costs for inputs and transport, a weak krona and the general unrest have consequences for the Swedish vehicle market and entail both longer delivery times and higher costs. We believe that the decline can mainly be attributed to the limited supply, even though we see a certain slowdown in strong demand due to the economic situation, says Sofia Linder, chief economist at Mobility Sweden, formerly BIL Sweden” (Mobility Sweden)
Notice that they don’t highlight the fact that the overall decline is down to combustion-only powertrains having plummeted, whilst plugins have kept growing. Although there has hardly been a “normal” period over the past 2.5 years to serve as a benchmark, many would therefore argue that much of the overall decline is due to what we have referred to as the Osborne Effect, which legacy players in the auto industry don’t want to draw attention to.
This effect occurs during a technology transition, when an industry’s overall volumes are shaped by diminished demand for the outgoing old technology, whose drop in demand volume is not yet readily substituted for by the (still slowly ramping) supply of the new technology — the technology that increasing proportions of consumers are aware of, and are holding out for.
The net result is a transition period when net industry sales volumes dip overall, before returning closer to the established volumes seen before the transition.
We at CleanTechnica mostly consider the auto industry to now be firmly experiencing just such a dip (or “Osborne Effect”), especially in mid-transition markets like Sweden. Whether auto volumes will ever return to (or exceed) their peaks of the 2015 to 2019 period is another question, and a complex one.
Either way, plugins are continuing to gain market share in Sweden, growing by a relative 12% YoY, despite recent one-off supply headwinds (e.g., Tesla Shanghai’s paused production). As mentioned above, I am expecting September’s plugin share to be in the 60% to 65% range, other things being equal, and above 70% in December.
What are you thoughts on Sweden’s plugin transition? Please jump in to the discussion below.
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