Price-Parity EVs: Some are already here, and the clue is their sales volumes.
EVs won’t reach price parity in one particular year, but instead some from Tesla, BYD and others including Mercedes are already at price-parity. In contract, most EVs are not there yet, and some are not at all close to price-parity.
Given that dedicated EV brands tend to be first with price-parity, there may be interesting implications for brand loyalty to established brands.
There have been many predictions about when EVs will achieve price-parity with traditional ICEVs, but in reality, the one single date for ‘EV price-parity’, would only happen there was some synchronised price change for all EVs.
In the real world, price-parity is achieved model by model, one model at a time. While the average across all EVs is not price parity, all it takes is a number of overpriced EVs to drag down the average, and overpriced vehicles don’t sell well anyway, so what matters is which vehicles do have price parity.
I suggest the only true test for price-parity between comparable vehicles is the percentage of people who choose each vehicle.
On that basis, if EVs overall had price parity, EVs would have 50% of sales. But with the Tesla Model Y a contender to take over as the words bestselling car, at it suggests that at least the Model Y has price-parity.
Earlier in my own learning curve, I also fell into this trap of imagining a year when price-parity would just happen. Perhaps something like a drop in battery prices, or new battery technology or something that would then impact all EV prices. But that is not how it works. Like children growing older, it happens progressively, and waiting for it to happen all of sudden can mean missing that it is already happening, or at least with EVs, that some price-parity EVs do already exist.
This paper reviews:
- Determining price-parity and the arrival price-parity EVs.
- Combining global and ‘incentive free’ Australian market data for insights.
- Which brands are doing what and the models available.
EV Price-Parity: The proof is in the sales, and to lesser extend the ratings.
The problems comparing EVs and ICEVs.
It seems simple. Use vehicles that are available both as an EV and as an ICEV, and only when both version of those vehicles are the same price, will there be price parity. But it is not so simple, because even when comparing EVs from the same brand, an EV made on a dedicated EV platform “is just a different sort of thing” to an EV version of a vehicle that was designed to also have an ICE version. Vehicles where there are both ICEV and EV models, are really designed with the goal the EV will be a high end, faster accelerating top of the range version.
The EV models of such vehicles are specifically designed to not have price-parity.
There are also differences between an EV and an ICEV other than on simple being electric. The electric version will be quieter, normally accelerate faster, and have lower fuel costs, as well as requiring less maintenance. To go with these differences, the EV models are produced in smaller numbers, and are usually more fully equipped.
All these specification differences take a backseat to the fundamental problem: building an EV as a version of vehicle designed to also have an ICE version “is just a different sort of thing” to an actual competitive EV product.
Specification differences make price-parity subjective and dependant on weighting of criteria.
In one sense, every time someone buys a vehicle, they have decided that, for them, the vehicle they chose is for them the best choice for the money. Any vehicle that someone buys, is seen as having price-parity by the buyer. This means almost every available vehicle is in the view of some buyers the best value according to their criteria.
Some car comparative reviews use a point scoring system, where a number of points are awarded in different areas. Even readers who agree with number of points for each area, may come to a different conclusion, because different people value the significance of the different categories differently, and may even include their own categories or criteria.
Not everyone goes as far as listing their criteria and allocating points, but every opinion on which vehicle is the best choice, is effectively giving weight to a set of criteria.
Clearly there will never be universal agreement on price parity between vehicles, and there will not be one concrete test for price-parity that everyone would agree upon.
But it is possible to learn the majority opinion through sales, and the expert’s opinion though reviews.
Categories: Is comparing apples with oranges like comparing hatchbacks with pick-ups?
With sales number, there will typically be a list of the top 10 or 20 bestselling vehicles, which in any given country will for long sequences be dominated by the same types of vehicles. In the USA in 2022, on this count, positions #1, #2, #3, # #6 and #7 of the top 10 were “pickups”. In those figures, the Corolla missed out on the top 10, does it make sense to compare sales of the Corolla to sales of pickups, or does it make more sense to identify similar vehicles in a similar price bracket, and compare the Corolla to those vehicles? On the same website, the review of the Corolla did list such vehicles, but I did not find a comparison review, although there would be many available, such as this comparison between “flagship variants of two of the most popular small cars”.
Many sites and other resources compile sales statistics by category, and almost all reviews comparing vehicles only compare vehicles within the reviewer’s definition of the relevant category.
What constitutes a category is still quite subjective, and while boundaries may occasionally be set to manipulate results, most sources tend to maintain the categories from year to years, which limits any such manipulation.
Sales vs Awards in determining price-parity: The Majority vs the Experts.
Since there is never an exactly matching specification, ‘price-parity’ comes down to ‘value for money’, which in turn requires an evaluation each vehicle.
The approach of both considering a ‘popular vote’ as well as the opinions of critics, can also be applied to cars.
The popular vote is reflected by sales, which represents a more significant and clearer commitment that simply watching, and perhaps not even completely watching, a film. Other than possible manipulation or inappropriate rules for the categories, sales figures provide a clear objective result.
The critic’s vote is reflected by ‘car of the year’ awards and has the advantage of being available when a product is first released which means it is available prior to their being sales data.
Both can be validation of the value for money, and thus ‘price-parity’, of different vehicles. A vehicle achieving higher sales than any comparable vehicle is a very clear indication that vehicle is considered by consumers as value for money and having achieved ‘price-parity’, and consistently winning acclaim from critics in comparisons where price is part of the category definition or value for money one of the criteria, also presents a very compelling case for a vehicle having achieved ‘price-parity’.
But both sales numbers and critics opinions also have their limitations.
When considering sales numbers, a vehicle with both sedan and hatch versions having the same name and being considered in statistics together would be expected to have sales numbers similar to the combined total of the sedan and hatch sales from another brand where sedan and hatch version have distinct names. How data is presented can be open to manipulation.
Then there is the effect of marketing, through advertising campaigns, and increasingly through social media. Raising the price of vehicle by 10% in order to allocate that money to marketing decreases the value for money, but if the campaign is successful, can raise the sales despite the vehicle then having worse ‘price-parity’.
There critics view, while generally useful, also has limitations. These views are also not immune to influence by marketing, with many critics and review publications and websites, dependant on the revenue from marketing campaigns to fund their operations. Even when opinions are not influence by the marketing dollar itself, the ability to critic vehicles can depend on suppliers providing the vehicles, and that creates a dependence on a maintaining a cordial relationship with the supplier. Then there is the reality that not everyone agrees with the critics, and sometimes for very sound reasons.
But in the end, these two resources are the best available to judge ‘price-parity’ with sales numbers being the more objective but being available later and to some extent only providing data in retrospect.
If an EV ties in sales numbers with the ICEV sales leader, or ties with ICE vehicles in car of the year awards, then it would have true ‘price parity’. In reality ties are rare, and what people wat is not EVs reaching ‘price-parity’ but eclipsing ‘price-parity’.
Price parity for a segment in a segment is achieved when EVs hold 1st place.
The EV Price-Parity requirement: category contenders without ‘EV’ being in the category criteria.
There are specialist lists of “bestselling EVs”, but as of 2022, EVs are already entering best-selling lists of all vehicles, not just EVs, and for some years have already been winning “best vehicle” awards that are not specifically for EVs.
All early EVs were consider too expensive when compared relative to otherwise comparable ICEVs to be considered to be considered as even close to achieving ‘price parity’. The vehicle being an EV had to be considered the key criteria.
Yet, despite most people seeing then EVs as overpriced, a minority of people still chose to buy those early EVs. They did so without being forced, and by most reports, most of those people were happy with their purchases. This means that for a minority of people, even those first wave EVs were worth the price, and thus to them had price-parity. Most likely, because that small minority felt ‘zero emissions’ justified the higher price. In recent years, the profit of zero emissions has increased, which
I suggest the term ‘price-parity’ for EVs, requires being able to ignore any ‘points’ credit for EVs having zero emissions. If having zero emissions is considered a benefit, it can be free benefit, without any price premium.
Price parity for EVs requires a competitive price without any consideration for EVs having zero emissions.
“Schrödinger’s parity”: Both price-parity and not at the same time.
Schrödinger’s cat is a thought experiment based on a hypothetical cat that simultaneously existing in two states at the same time. The Tesla Model 3 could also be considered to exists in two categories at the same time:
- Performance sports sedans for all vehicle (both ICEVs and EVs).
- Family sedans that are an EV.
Rather than this being a less form of price-parity, the result is the Model 3 has two set of sales: dominance within its narrower category, plus family sedan buyers will to pay more for an EVs seeing extra value from abilities outside those their core priorities.
The Model 3 attracts price-parity for buyers looking for sports sedans, and also collecting sales from buyers who will only buy an EV but are not specifically looking for a performance sedan. Even for those not seeking a performance, the performance of the model 3 provides yet another justification for the price, and one that even provides status when in circles more sceptical about the need for zero emissions. The result is that even for those buying from the “family sedans” category where the Model 3 could be seen to not have price parity with ICE vehicles, the high ranking in the “performance sports sedan” category becomes a big plus.
Those who wants a sports sedan can perceive they get price-parity, as sports sedans with the acceleration of the Model 3 are typically even more expensive than the Model 3. For a buyer with the BMW M3 and Mercedes C63 also on their shopping list, the Model 3 has price parity.
This idea of “Schrödinger’s parity” is vehicle having parity in category outside of the category of the normal shopping list of many buyers.
Price-parity EVs: What’s here, and why are more on the way.
What’s here already: Tesla, BYD and Others.
Meet the world’s top 5 best-selling electric vehicles. At least 4 of the 5 already have sales track records in many of the countries they are available which suggests consumers en masse are finding these vehicles can compete for their dollars and thus can claim to have ‘price-parity’.
Currently, the top 5 best selling EVs globally are the Tesla Model Y and Model 3, and the BYD Song, Yuna Plus / Atto 3 and the BYD Dolphin.
The Tesla Model Y was the 4th best-selling vehicle globally in 2022, placed higher in global sales than any other “SUV”, and with no other “premium SUV” even making the top 10, the result is very impressive even if the Model Y is the beneficiary of significant “Schrödinger’s parity” sales.
The Tesla Model 3 made was number 11 in slaes globally in 2022, was only beaten by the Toyota Camry in sedan sales, and clearly not beaten by any other “performance sedan”. In many countries the Model 3 even outsold the Camry.
The BYD Song was the 2nd biggest selling plug-in vehicle in the world in 2022 and sold in numbers large enough to be the in top 10 best-selling vehicles globally, despite being sold only in China. While this vehicle established itself as a market leader in China, the sales numbers include both BEV and PHEV versions, and and it is not given the same export focus as other BYD models such as the Atto 3 (Yuan plus) and Dolphin.
The BYD Atto3 / Yuan Plus is knowns as the Yuan Plus in China, and the Atto 3 in other markets. This vehicle can already claim to be the 3rd best-selling pure battery EV in the world, and if not already outselling the BEV version of the BYD Song, it will soon. Introduced to international markets as the Atto 3 in late 2022, with just sales figures for November and December it rose to 3rd place in EV sales for the Australian market behind Tesla Model 3 and Model Y, but has not remained behind tesla in all markets:
- BYD Atto 3 again became the bestselling EV in Israel in Feb 2023
- BYD again became the best-selling EV in Thailand in Feb 2023
- Tesla’s sales surpassed BYD by 25 vehicles in New Zealand in February
In January in New Zealand, BYD sold 235 EVs, while Tesla sold 194. Tesla’s increase in sales in February allowed the company to overtake BYD in New Zealand’s EV market. However, if you add up the data from the two months, BYD still leads with 378 EVs sold, while Tesla is close behind with 362. The competition between Tesla and BYD in New Zealand is expected to continue, with both companies vying for a larger market share.
Regarding model ranking in February, BYD ATTO 3, with 143 sales, took the top spot.Carnewchina: Atto 3 is best-selling EV in NZ, so far in 2023 outselling Model 3 and Model Y combined.
The BYD Dolphin is already at number 5 globally despite, being on sale in even less markets than the Atto 3. As such, I do not yet include it in the vehicles having some proven price-parity, but I suggest this will be proven overtime.
BYD: The lesser known half of the Tesla – BYD Duopoly.
There are many projections, particularly in the US, on how as other carmakers get into EVs Tesla will lose market share, and in the fledgeling US EV market, Tesla will lose some market share, but in the far larger global EV market, the two leaders, Tesla and BYD, are together are growing their dominant market share.
BYD grew from over three-fold from 2020 to enter the top 10 car brands in China in 2021 at position 6, and then again over three-fold again in 2022 to overtake Toyota and VW to become not just the largest EV maker in the world’s largest car market, but the largest maker of all vehicles, despite themselves no longer producing any ICE vehicles.
In 2022, despite being the world’s largest maker of plugin-vehicles, they still were not one of the top 10 globally. In 2023, they probably will enter the 10 producers of vehicles, and perhaps even at no 6. But on the global stage it will take more than one extra year to overtake Toyota and VW.
- Tesla + BYD Nearly 40% Of BEV Sales Globally
- BYD #1 In World In Plugin Vehicle Sales In 2022
- Tesla #1 In World BEV Sales By Big Margin — 2022 World EV Sales Report
The world EV market is dominated by Tesla and BYD because they offer some price-parity EVs.
The world market of EVs or ‘plug-in vehicles’ is dominated by Tesla and BYD and not by existing car brands. Big EV brands Tesla, who everybody has heard of, and worlds 3rd most valuable car company, BYD, who far fewer outside China are familiar with, VW group, and SAIC, and Geely Volvo are way ahead, with VW and the Volvo component of Geely-Volvo the only established mainstream traditional automotive brands even present.
Tesla is not first on “plug-in” sales, in part because BYD, VW, and Geely-Volvo numbers all include not just ‘pure-EVs’ but also PHEVs or ‘plug-in hybrids’, and in part because BYD sales numbers are growing even faster than tesla sales numbers. In many respects, BYD sand Tesla are neck and neck in the leadership race, with no ‘unified belt’ title holder.
VW is closer than it looks to the top two. As the VW numbers include PHEVs, they are best compared with BYD numbers. VW sells less than half of what BYD manages, despite BYD only just starting to get serious about selling outside of China.
SIAC achieves 4th spot most due to sales numbers for the Wuling Mini-EV, as SAIC has control of the consortium, as 50.1% stakeholder.
Tesla earned its position through just two models, the Tesla Model 3 and Model Y. Which are both market leaders in their segments outselling comparable ICE vehicles, not just other EVs.
The world EV market outside of China, is currently dominated by Tesla. The model 3 and model Y are not just leading in EV sales, the model Y looks like being the top selling car in 2022 outselling the previous leader, the Toyota Corolla, and the model 3 is often bestselling vehicle in its class of premium sports sedans.The 3rd EV Wave (on this site).
Of these top 5 EV companies, only Tesla has models with both global success, and segment leading sales.
BYD has only just began serious exports, and in particular their Atto 3 model has potential of volumes rivalling the Model 3 and Model Y, but such for the Atto are just that, potential.
VW may be dependent on EV subsidies for EV sales volumes, electing to not even enter the market in Australia due to a lack of Australian emissions standards. Emission standards require manufacturers to achieve average emission lower than a set limit across their fleet of vehicles on sale. The result is that adding an EV to the fleet can solve the problem and becomes important, even if sales of that EV do not themselves generate any profits. This suggests sales of the VW Id.3 and Id.4 are not only directly assisted by government subsidies, but also by internal subsidies from VW itself.
It is yet to be proved that the success of the very different Wuling-Mini-EV can be replicated outside China, although SAIC does now produce the MG4/Mulan, which also has the potential to become a global best-seller.
Volvo sales are very mostly all plugin hybrids (PHEVs), but other Geely brands including Polestar are worth watching.
It becomes clear that subsides and market distortions can make interpreting sales data complex, but the only proven high volume global EVs are the Tesla Model 3 and Model Y, with the BYD Atto 3 and SAIC MG4 unproven, strong new contenders.
The role of scale in Production cycle and sales volumes as the key to vehicle costs.
EVs as of late 2022 are just around 10% of the global vehicle market, which gives ICEVs 90% and 9x the sales volume. This means which suggests that EVs overall are a niche market, and should not be able to compete with ICEVs due to the lack of volume production.
Both Tesla, with the Model 3 and Y, and BYD in general, have managed to break through to competitive sales volumes.
How Tesla and BYD have broken through the sales volume barrier.
The Tesla Model Y made position 3 on the top-selling cars worldwide for 2022, and the model 3 made position 11.
The Model Y was only outsold by the Toyota Corolla, Ford F Series and Toyota Rav 4, with only the RAV 4 being even vaguely comparable as a vehicle type. The other vehicles that outsold the Model 3 were the Toyota Camry, Honda CR-V, Chevrolet Silverado, Hyundai Tucson, Toyota Hilux and Ram Pick-up, and from that group, only the Toyota Camry is even vaguely a competitor to the Model 3. In reality, both the Model Y and Model 3 sell in greater numbers than any direct competitor. While Tesla does not have the overall volume from a wide range of Models to yet make the top 10 automotive brands in numbers worldwide, these two models have significant overlap of components and cocan competer in terms of volume with the biggest brands.
BYD on the other hand, despite not being on that list, also has the production volume.
Firstly, while the BYD Song is not on the list, it did manage to just outsell the Tesla Model 3 in 2022. The Song is not a global vehicle, so no matter how high the sales, perhaps does not belong on a list of top selling vehicles globally.
In total, BYD production numbers are even higher than those of Tesla, and although BYD numbers also include PHEV models, in terms of total vehicle produced in order to leverage scale, the numbers are there.
Perhaps even more impressively, BYD is now the top selling brand in the largest vehicle market in the world, China, which alone now accounts for over 1/3 of the world vehicle market. BYD is not simple the top selling plugin brand, it is the top-selling brand overall, now outselling combed ICE and plugin sales of all other brands such as second placed VW and now each month 5th or 6th placed Toyota.
No other plugin vehicle brand is in the top 10 brands in China, and each week in China EV sales BYD typically outsells 2nd place Tesla by 3 or 4 to 1 with other Chinese brands further behind. While media often portrays how EVs from China will displace western brands, there is no other EV brand at this time with the economies of scale that BYD has. BYD is not just the biggest EV maker in China, it is the biggest vehicle maker period.
The economics of scale Tesla and BYD now have the 1st and 3rd largest vehicle makers in the world by market capitalisation.*
*Note Porsche has recently overtaken BYD for the #3 position and relegated BYD to 4th (Match 2023).
The Waves of category contender ‘price-parity’ EVs.
First wave EVs: Sales numbers and comparisons only significant within ‘EVs only’ categories.
The ‘first wave EVs‘, such as the Nissan Leaf, Mitsubishi iMiEV etc would never appear on any ‘top-sellers’ list without “EV” or zero-emissions being one of the criteria for the category. While they could win “green car of the year” or “EV of the year”, and this limitation to only being able to compete with other zero emission vehicles in terms of value for money is what restricts vehicles to being “1st Wave EVs”.
I feel 1st wave EVs as being ‘too expensive relative to ICEVs for most people‘.
2nd wave EVs: price-parity only within niche categories.
The second wave of EVs, spearheaded by the Tesla Model 3, are all vehicles that are popular relative to their direct competitors, however, those direct competitors are niche vehicles. These vehicles will be at or near the top of the best-seller list for their category, but in a category with premium prices, and where that category could be considered ‘niche’.
Niche? The term ‘niche’ is highly subjective, so I define ‘niche’ as “no vehicles from that segment within the top 10 of the national best-selling vehicles list”.
Sales for the Model 3 overall have far exceeded that warranted success within its niche, courtesy of “Schrödinger’s parity” sales from EV buyers looking for an EV rather than a performance sedan, although some of these buyers have since switched to the Model Y, as they were not really wanting a sedan at all.
Market data for China shows that, at least in China, price-parity EVs are not only restricted to only niche premium vehicles. In China, one of the best-selling vehicles is the Wuling Mini-EV, which sells for around US$5,000.
But outside of China, when the Model 3 launched, it was the lone ‘price-parity’ EV for any category not for EVs alone, set EV sales records, despite being a sports sedan and logically only competing in a niche, premium priced, category.
3rd Wave EVs: The requirement for more significant price-parity EVs.
Until the release vehicles like the MG4 or the BYD Atto 3, in most countries the only EVs with price-parity only achieve that price parity in categories with prices above the median price for new vehicles.
This has perpetuated the belief that EVs are expensive and meant any buyer wanting an EV, needed to be prepared to spend more than most new vehicle buyers spend.
To succeed in mass market segments, you need to produce vehicles in significant volume.
that did not want a sports sedan, head to either buy a Model 3 even if they did not value the sports sedan attributes, or an alternative EV not achieving price parity. Even many Tesla Model 3 owners were not really getting price-parity, because they had to buy a sports sedan even if that is not what thy would have otherwise chosen.
Without products in other market segments, most EV buyers are still paying a premium.
Third wave EVs are just starting to reach more international markets, finally increasing the percentage of buyers with a price-parity EV option.
Analysis from a subsidy free market: Australia.
Why Use Data from Australia?
Up until 2022, Australia had no EV subsidies and still has no fleet emissions standards, which means EVs gain no assistance in their battle for price-parity.
EV New Car Market Share in Australia: 2%? 5%? 10%!?
For the last complete year of data, 2021, only 2% of new car buyers in Australia chose an EV.
But using the year average from 2021 now in late 2022, is quite out of date in a rapidly changing market.
There are a range of different statistics on market share of EVs in Australia, mostly, they focus on percentage of the new car market, which brings its own distortions, but if you are buying a new car, then it is what applies. Quoted figures include:
- In 2021: 2% of new vehicles sold were EVs.
- The number was rising throughout 2021, so the annual average lags the current number.
- By June 2022, the number was 5% of new sales.
- By September 2022, EVs were 7.7% of new sales.
- It is predicted in Australia in December 2022, EVs may reach approximately 10% of new sales in Australia.
While using year average figures in a quickly rising market makes numbers look artificially low, Tesla reports most sales in the last quarter of each month, making both September and December numbers potentially inflated.
This graph from ‘The Driven’ website illustrates the rapid growth of EVs in Australia since the release of the first ‘price-parity’ EV, the Tesla Model 3 in 2019:
- In 2019, Australians purchases more EVs than in all previous years combined.
- 2020 was not a normal year due to lockdowns and Covid-19.
- In 2021, Australians again purchased more EVs than in all previous years, including, 2019 & 2020, combined.
- Although 2022 is not yet over, Australians are again on track to purchase more EVs that in the combined number from 2021, 2020,2019 and all previous years.
This well beyond even a doubling each year. But the sales numbers are all about price-parity EVs. Despite their being around 60 EVs on the market in Australia, prior to the Tesla Model Y in August 2022 and BYD Atto 3 in September 2022, the Tesla Model 3 models accounted for over 60% of all EVs sold in Australia.
The second best selling in EV in Australia prior to Model Y and Atto 3 (which rose almost instantly to #2 and #3) was the SAIC produced MG ZS EV, which, although substantially below the price of the Model 3, and the lowest pried EV in Australia, still did not offer price parity. In fact, up until around mid-2022, arguably the only other price-parity EV available in Australia was the Porshe Taycan, which does sell very well relative to other Porsches and vehicles in its price bracket, but it is not a volume price bracket.
This is clearly why the sales boom coincided with the release of the Model 3.
The Lack of legacy brand price-parity EVs.
Without subsidies and/or emissions standards, few legacy brand EVs sell at scale.
While the above data shows that even in previously EV incentive free Australia, EVs sales grew rapidly as soon as price-parity models arrived. One vehicle, the tesla Model 3, commanding 60% of all EV sales. With close to 60 EVs on the market, sharing the remaining 40%, and the best-selling of those other EV models being a new to market MG is from Chinese SAIC, and not one of the big brands. In summary, in a market with without subsidies, EVs that do not offer price parity sell in very low numbers.
High End Luxury Model EVs do sell, but they are expensive low volume products.
Yet, luxury brands see things differently.
One clear price-parity EV in Australia that was not from Tesla prior to 2022, was the Porsche Taycan. This has been now joined by others such as the Mercedes EQS and the BMW prio
“Step by step, we see the market turning,” Kallenius said in an interview as part of CNBC’s ESG Impact conference on Thursday. “I really believe that in this decade, we will flip from being based upon high tech internal combustion engines to going dominant electric, if not all electric, in the luxury segment.”……Mercedes-Benz CEO says luxury drivers will help spur the transition to electric vehicles
The company has said that it will have fully electric versions of all of its models by 2025, and that all of the new vehicle architectures it develops after that date will be electric-only……
“As long as you give the customer a superior product to what they had before, they’re open minded for a switch” to electric models, he said. “The experience for the customer in terms of the torque, the performance, everything is fantastic.”
Less luxury brands suggest Customers are not ready for EVs.
Either the customers are very different, or other brands are applying different confirmation bias.
Toyota has a consistent message that consumers are not ready for EVs, and rising sales from Tesla are not seen as any indication that consumers are moving to wanting EVs:
Pratt said that regions like Norway and other parts of Europe have enough green energy and charging infrastructure to support EVs, but this simply isn’t the case everywhere else. In summary, Pratt views a “diversity of options as a strength, rather than a weakness. CO2 is the enemy, not a particular drivetrain type.” That diversity is reflected in Toyota’s continued development of hydrogen power for vehicles like the Mirai.Toyota Chief Scientist Gill Pratt, in article: “Toyota’s Chief Scientist Says The World Isn’t Ready For EVs”
BEVs cost too much, and the infrastructure isn’t sufficient to charge vehicles away from home, Hollis reported in a recent Automotive Press Association webinar. “I don’t think the market is ready. I don’t think the infrastructure is ready. And even if you were ready to purchase one, and if you could afford it … they’re still too high,” Hollis told listeners………
Hollis noted Toyota and other automakers have offered hybrid vehicles for nearly 25 years, but U.S. market share remains less 10%.Toyota USA CEO. August 2022: Market Not Ready for EVs
With all of that said, Toyota’s VP of Sales and Marketing in Australia, Sean Hanley, recently debuted the Toyota Corolla Cross Hybrid. According to Electrek, after his speech, the VP fielded questions from the media. Of course, he was asked about the automaker’s EV plans and overall progress in reducing its carbon footprint. Electrek reported that the executive appeared to get somewhat defensive.
Hanley said Toyota isn’t opposed to battery-electric vehicles (BEVs), but that carbon neutrality requires “taking everyone on the journey.” He added that carbon is the enemy in this situation, not a car’s powertrain. He said Toyota agrees that carbon is a problem and that we need to take steps to become neutral, but that the automaker doesn’t necessarily agree with others about precisely “how and when you get there.”Toyota Suggests Its Hybrids May Help Reduce Emissions More Than EVs
As the current market leader, the question is whether Toyota knows something, or is applying confirmation to what they see because they fear something. Either way, Toyota is going to be lobbying to affect what happens in future and has the biggest lobbying budget of all car companies, despite no longer being the richest car maker and having substantial debt.
It is not just Toyota, with Mitsubishi also repeating the same claim.
There are some ‘new-vehicle-type’ EVs that will never attempt price-parity.
Japanese brands can be strange with EVs that are not intended to be real ‘cars’, and some others seek to redefine transport. The end result is that not everything called an ‘EV’ is even intended as a direct alternative to current vehicles.
Some of the ‘out there’ EVs are brilliant in their own way, like the Arcimoto or Aptera, but simply not a viable replacement for the conventional car. Then there is the ‘city car’. The Microlino may even make the city car idea work, but Japanese attempts like the Honda-e, Mazda MX-30 EV, and even the Lexus UX 300e which all have insufficient range for general purpose use but are priced uncompetitively with real EVs that you can use as normal cars.
The Mazda MX-30 EV and Honda-e and Lexus UX 300e all cost more than a Tesla in the subsidy free market of Australia, despite that the Honda and Mazda have a range of less than 160km in the real world even in the city. The over $80,000 dollar Lexus does have a range of 300 km in theory for the city, but at freeway speeds expect more like 240km, and by the time some range is considered reserve, that means even on the 80-minute recharge using the CHAdeMO plug that almost everyone else has abandoned, is not going to deliver even 2 hours of freeway driving!
None of these are “real cars”. Lexus does recognise the car is limited and proves a solution:
But if you need to travel long distances and don’t want to regularly stop to charge, Lexus Australia offers petrol- or hybrid-powered loan cars for four trips up to eight days in duration over the first three years of ownership, so at least you have that option, too.Lexus UX 300e 2022 review
Sort of like an admission of the vehicle’s failings. Yes, the BMW Mini Electric is neither much better, nor much cheaper, but at least BMW also has some real EVs you can buy.
Japanese makers, the mighty Toyota included, seem on very shaky ground with respect to EVs.
List of EVs available in the Australian market 2022 and 2023.
While I am adding specific comments on major brands, there are website with complete lists, so here are some links.
- Drive: All EVs launched in Australia during 2022 and 2023.
- Gizmodo: On the market 2022.
Model 3 and Model Y: Benchmarks and world bestsellers in their segments.
The best-selling EV models in the world as of late 2022, plus the best-selling of all, petrol/gasoline vehicles included, ‘premium sedan’ and ‘premium midsize SUV’. From around A$65,000 for the base model 3, over A$80 thousand for the long range and over $90 for the performance model, with the model Y in two versions as of October 2022: Rear wheel driver for A$72,300 and All wheel drive for A$96,700, with both prices “before on-road costs”.
They are expensive or “premium” and many while many do question build quality for their price, the cars in Australia are all built in China and have better build quality than typically associated with Tesla. Given sales numbers, it is clear these vehicles have a lot going for them.
Model S, X and lower cost Tesla?
The model S and X are not really promoted in Australia right now, and both are quite fringe vehicles. While pricing may have become more competitive as the cars have improved, these were both initially 1st wave vehicles: priced higher than an equivalent , and were always .
Atto 3: Is it possible it could become the world’s best-selling passenger vehicle?
Imagine how well an SUV EV would sell with the value proposition of the Tesla Model Y, but at a price point of around 2/3 the price?
There are reviews from various countries:
- New Zealand’s best value EV
- India: Safest Electric Car Now in India?
- Singapore: Tesla owner, and reviewer.
The best reviews so far are those from NZ, as the Atto 3 has been in that market just a little longer. At least Australia reviews do not seem to be full of faint praise, but they do tend to have errors as far as specifications go, likely due to the cars being new in the market.
So, could this become the world best-selling car? Really? Perhaps it is more likely than any other EV so far, but there are still many reasons why it may not.
First, on the plus side:
- BYD has the production capacity.
- The value equation is extremely strong.
- Build quality is high.
BYD is already making more EVs than anyone either everyone but Tesla, or everyone including Tesla, depending on which vehicles are to be included. Either way, BYD have been ramping up production faster than Tesla, and on current trends are likely to be undisputed highest volume producer by early 2023.
The things against the BYD Atto 3:
- The name is unknown and distribution channels internationally are new.
- An AWD version, as well as some minor tweaks would definitely help.
- Who knows what other cars will hit the market in the at least two years the Atto 3 needs to ramp up global volumes.
- To remain sufficiently competitive, updates will be required.
- Being a Chinese car, so far only made in China, brings risks.
The MG4 is already a potential rival, but so far, there is no market with both cars on sale for price comparison. Plus the MG4 is between the size of the BYD Dolphin and BYD Atto 3.
BYD Dolphin, Seal, Sea Lion and Seagull.
The BYD Dolphin is as smaller lower cost hatch, and the BYD seal is a performance sedan positioned as a direct Tesla Model 3 rival. Both are already in sale in China, but not now expected to reach customers in Australia until mid-2023.
The Sea-Lion is Tesla Model Y rival, and the Seagull a ‘sub-compact’ EV, and neither is yet available in China or has any schedule for Australia. It has been said a ‘ute’ (pickup), will also be offered, but seems unlikely prior to 2024.
The Dolphin, Seagull and unnamed ‘ute’ will do most to change the market, although there are also many people looking forward to the Seal, which will be another premium sports sedan, although at a slightly lower price point than the Tesla Model 3.
Other BYD Vehicles? Tang? Han?
It seems unlikely BYD launched prior to the Dolphin with ever by available in RHD.
China: SAIC (MG), GWM, LDV, Geely (Volvo, Polestar, Lotus, Zeekr etc).
SAIC :MG4, MGZS EV
The MG4 will most likely the 2nd 3rd wave EV to arrive in Australia, and as such, is likely to be highly competitive. This car is a step up from the MG ZS EV, as can been seen from reactions (Carwow: best EV I’ve driven all year, Elecrifying: game changing, Fully Charged: Bargain of the Century), Electroheads: too good to be true) in the UK where MG4 has just arrived and is getting a much bigger reaction than the ZS which has been on sale for some time.
The MG ZS is a highly price competitive budget SUV, and the MG ZS EV did break new ground for price of an EV in Australia, but in the end, it is a 1st wave EV that is a far more expensive version of an ICEV. Currently priced similar to the BYD Atto 3, but needs the larger battery for Australia, and for most people, the Atto3 is seen as the better choice (Wheels comparison). MG has far better brand recognition, then BYD, but in the end it is just a Chinese state-owned company (SAIC owns the MG brand now), vs BYD, a privately owned Chinese company.
GMW (Great Wall Motors, Haval, Ora, Wey, Tank): Ora Cat, Ora Funky Cat.
GMW (Great Wall Motors) is known in Australia only for ‘Utes’ and large 4wds, but they also have the electric brand Ora (Cat and Funky Cat) and a plugin hybrid brand Wey (Coffee 01/Mocha Latte and Macchiato).
Although Ora does not make top-seller lists in China, it could become significant in Australia, depending on pricing, which is not yet available.
Geely: Volvo XC40, Polestar 2.
The current Volvo offering in Australia is clearly ‘1st wave’ with a petrol engine version at substantially lower price. The versions of the Polestar 2 have a quite similar value equation, and while most critics find it slightly behind the Tesla Model 3, it is also sufficiently different that it provides an alternative for those want something different from a Tesla. It offers choice, but no real breakthroughs yet.
Germany: VW (Audi, Cupra, Porsche, Skoda) Mercedes, BMW (Mini).
VW Group: Porsche Taycan, but little else with price-parity so far.
The Porsche Taycan may be expensive, but there is a reason it is one of the best-selling Porsche models in Australia: it is a fully price competitive 2nd wave EV.
Other offering from VW so far in Australia have been 1st wave: pay a premium just to get an EV.
Neither VW ID.3 nor ID.4 is yet offered in Australia, which itself is interesting. For me all other available VW group vehicles beyond the Porsche are still 1st wave.
Mercedes: EQS, EQE, EBA, EQB, EQC.
The EQS is a follow 2nd wave EV, that in comparisons with a similarly priced Mercedes S Class, is usually seen as the better choice, and can even offer better range. Most of this seems to also apply to the EQE. Mercedes seems to be managing the transition to EVs as well as any other legacy automotive brand.
The EQA, EQB, and EQC however, are far more expensive than their petrol equivalent GLA, GLB and GLC, making them 1st wave vehicles and a harder sell.
BMW: iX, i4, iX3, iX1, Mini.
The iX and i4 are full 2nd wave EVs, while the iX3 and iX1 require a substantial spend over and above their internal combustion counterparts, and the Mini is designed to be a 2nd or ‘city’ car only. The iX3 costs substantially more expensive than even the plugin hybrid X3, and the BMW iX1 is priced from A$82,900 while the X1 starts from A$53,900.
Let me preface this by saying that typical M3 customers won’t cross-shop the i4 M50 and typical EV buyers won’t cross-shop the M3 Competition. However, they both should. True car enthusiasts go into any purchase with an open mind and any open-minded enthusiasts will look at the fact that both cars are priced incredibly similarly, have very similar power figures, similar performance metrics, the same amount of doors and seats, closer overall ranges than you might think, and handling dynamics that aren’t too far off each other’s. So while customers likely won’t cross-shop the two, they absolutely should.Which to Buy: BMW i4 M50 or BMW M3 Competition?
USA: Ford, GM(Holden), Rivian.
Ford: Mustang Mach E, F150 Lightning. (Nothing yet on sale in Australia.)
These products are only available in the North America, or more specifically the USA at this time.
GM has the Bolt and Bolt EUV which, while not a price parity like an Atto 3, can be reasonably close. The Bolt EUV in base trim is only just above the price of an Atto 3, but even the significantly more expensive versions of are lower spec, in equipment, charging times and battery. Still without true 3rd wave competitors on the US market, these are as close as it gets. Sadly, the choice of LG Chem batteries has not helped.
The volume model for Ford has been the Mach E, and I will add more specific sales numbers, but think around 10%. This suggests it is not seen as price parity, even with subsidies.
Then there is the F150 Lightning, the EV version of the best-selling vehicle in the USA. There too much content on this vehicle to do it justice, but is it price-parity?
Some versions maybe, but again it is complicated. More than sedans and SUVs, an EV ‘pickup’ or ‘Ute’ becomes such a different vehicle that to judge ‘equivalence’ by other means than looking at the percentage of people choosing each version is most likely flawed. there is insufficient data at this time.
Japan: Toyota, Mazda, Mitsubishi, Honda, Nissan.
This is the shock. How can the market leading Japanese no have competitive EVs? But they don’t.
So far, if you really want an EV, then don’t bother with anything from Japan. This will probably change at some point, but as of 2022 with Toyota still seeming to feel the transition to EVs is impossible for them, EVs from Japan are a best a gamble. More to be added.
Korea: Hyundai – Kia.
Kia EV6, Hyundai Ioniq 5: These should qualify as 2nd wave EVs that completely directly with Tesla. In fact, in some markets, some variants even undercut Tesla in price, although by too small an amount as to really trigger a 3rd wave, still enough to in theory to be able sell at Tesla numbers.
The Hyundai Ioniq 5 was even world car of the year, yet sales numbers are low, not because the market does not want these cars, but because Hyundai is not producing them in volume. In Australia, Hyundai dealers cannot take orders for the Ioniq 5, and instead, potential customers signup for email notifications of when the next batch will be released for sale, and then must be one of the few who get to place an order from that batch which so far all allocated in minutes. The way these two models are sold, suggests they are loss making compliance cars, or halo cars for the brands, where having them on the market help each brand sell other cars. More realistically, it seems like Hyundai/Kia working to optimise and scale production to be able to produce these cars profitably in the near future, and meantime sell only enough to generate market interest.
Misc: Jaguar, Renault, Stellantis (Peugeot, Citroën, Fiat, Maserati).
Renault had the Oe 1st wave car which dominated the early EV niche in Europe and particulalry France.
The Jaguar iPace was unveiled in 2016 and won world car of the year in 2019, but although groundbreaking in many ways, it never lived up to the promise. Still one of the most off-road capable ‘crossovers’ available today, it is let down by poor efficiency which makes it charging times to add a given distance too slow, and the technology experience is old.
Renault as some promising ideas, but nothing beyond 1st wave on the market, and the same applies to Stellantis.
Conclusion: Three Perspectives of the EV Future.
The future of the world as seen by makers of price-parity EVs such as Tesla and BYD, is one where everybody wants EVs, and the challenge is ramping up production to meet orders.
At least some high-end or luxury brands, such as Mercedes, picture a future transition to EVs is moving along fine and the new car market could all be converted to EVs by 2030.
But that leaves other EV makers with a third view of the future world. For this group a future with EVs is a challenge and ideally one that can be delayed as long as possible. EVs are only 10% the total car market, and with Tesla and BYD and perhaps SAIC taking around 8 of those 10%, and everyone else fighting over the remaining 2%, it is hard to make a proft form EVs at this time, and EVs for now are a cost of preparing for the future.
Car makers with this view include:
- VW, GM, Ford and perhaps Stellantis, who have all claimed they can catch Tesla.
- Others who feel that Norway has proven with enough incentives all EVs can be price-parity and that is the future.
- Toyota and followers who feel EVs are a nightmare that the world will wake from and realise burning fossil fuels is still ok done slightly more efficiently in a hybrid.
For consumers who want an EV and not in the luxury market, one from Tesla, BYD or maybe another Chinese brand like SAIC (MG) is the easy choice. But if you do not like Elon Musk, or China, then it is about gambling with someone from the 3rd group, and, unless incentives make up the difference, paying extra as a result.
- 2023 March 19 th: Revised “proof is in the sales” and “whats-here”.
- 2022 Dec 12 th: Added notes on scale.
- 2022 Oct 19: First Version.