AutoTrends Weekly

Preface

China issues notice on advancing car trade-ins

• According to the notice regarding the further advancement of car trade-ins issued by China's seven authorities on Aug. 16, individual consumers who scrap old vehicles and purchase new ones in accordance with the "implementation rules for the vehicle trade-in subsidy" will see the subsidy standards increased from RMB 10,000 for purchasing new energy passenger vehicles and RMB 7,000 for purchasing ICE passenger vehicles to RMB 20,000 and RMB 15,000, respectively. 

• Subsidy applications that meet the criteria and are submitted between Apr. 24, 2024, the issuance date of the implementation rules, and Jan. 10, 2025, will be granted according to the standards specified in this notice.

• Additionally, for subsidy applications that have already been granted based on previous standards, local authorities will make up the difference according to the standards outlined in this notice. (China Automotive News, Aug. 19)

China unveils equipment renewal plan for energy sector

• The National Development and Reform Commission and the National Energy Administration on Aug. 21 unveiled an action plan to promote large-scale equipment renewals in the energy sector, as it moves towards achieving carbon reduction goals.

• By 2027, China's equipment investment in key areas of the energy sector is expected to increase by more than 25% compared with 2023, according to the action plan.

• Measures detailed in the plan will focus on the transformation of coal-fired power generation units, as well as equipment renewals and technological upgrading of wind power, solar power, hydropower, and other areas. (China Daily, Aug. 22)

Ride-sharing market to reach $452.27 billion by 2032

• The ride-sharing market is projected to reach $452.27 billion by 2032 and grow at a CAGR of 16.4% over 2024-2032, according to a recent report from SNS Insider.

• Over 75% of millennials prefer ride-sharing to car ownership, enthralled by the economics of the offering and convenience.

• Other factors are environmental concerns 60% of ride-sharing service users care about their carbon footprint. Technology, better integrated faultlessly in the form of smartphone apps and GPS, changed ride-sharing into something ubiquitous and accessible. (SNS Insider, Aug. 21)

Auto semiconductor market to $88 billion by 2027 as the top 5 vendors dominate 

• The auto semiconductor market is on track to surpass $88 billion by 2027, driven by the surging demand for high-performance computing (HPC) chips, graphics processing units (GPUs), radar chips, and laser sensors, according to a recent report from the international data corporation (IDC).

• This growth is fueled by the increasing adoption of the ADAS, EVs, and the Internet of Vehicles (IoV), bringing new growth opportunities for the auto semiconductor sector.

• The top five vendors, Infineon, NXP, STMicroelectronics, Texas Instruments (TI), and Renesas Electronics, in the auto semiconductor market captured over 50% of the market share in 2023.

• IDC predicts that as the value of semiconductors per vehicle continues to rise, semiconductor companies will become increasingly critical to the auto supply chain. (IDC, Aug. 20)

Partially autonomous cars to comprise 10% of new vehicle sales by 2030 

• By 2030, up to 10% of global new car sales could be level 3 vehicles. Partially autonomous level 2 / level 2+ vehicles that require driver supervision are forecast to be about 30% in 2027, according to a recent report from Goldman Sachs.

• AI advances could accelerate the adoption of vehicles that are substantially more autonomous.

• Lower costs of hardware are another potential reason AV adoption may increase.

• AV sales (level 3 automation or higher) are expected to account for about 60% of all light vehicle sales in 2040. Even in a less optimistic scenario, AVs will likely make up close to 40% of new sales. (Goldman Sachs, Aug. 19)

Autonomous driving software market worth $7.0 billion in 2035

• Autonomous driving software market is projected to grow from $1.8 billion in 2024 to $7.0 billion in 2035, at a CAGR of 13.3%, according to a recent report by Markets and Markets.

• As automakers and technology companies plan to launch self-driving cars, demand for driving software solutions is likely to rise due to increasing investment in ADAS/AD technologies by OEMs and technology providers. 

• Rapid advancements in AI and sensor technologies, along with rising consumer interest in ADAS for improved safety, are expected to drive the demand for autonomous driving software in level 2+ vehicles.

• Further, the shift to software-first architecture and technology sharing between leading OEMs and tech companies is speeding up the shift to higher levels of autonomy. (Goldman Sachs, Aug. 21)

NEV trade-ins service market to expand significantly in 2024 

• The NEV trade-ins market is projected to expand significantly in 2024, driven by increasing NEV sales and a growing emphasis on sustainable transportation solutions, according to a recent report from QYResearch.

• Government policies and incentives aimed at reducing carbon emissions and promoting NEV adoption are catalyzing market growth and reshaping the competitive landscape.

• As consumers become more environmentally conscious, there is a notable shift towards upgrading to newer NEV models, fueling demand for trade-in services. (QYResearch, Aug. 21)

EVs showing greater potential to feed grids

• EVs can potentially double up as super giant "mobile power banks" to support electricity supply and ensure grid stability during peak power consumption periods, as recent trials across Jiangsu province have shown, experts said.

• Jiangsu has launched China's first large-scale vehicle-to-grid (V2G) interaction trials. The maximum discharge load reached 1,047 kilowatts, which met the electricity demand of 209 households in the surrounding neighborhoods for one hour, said State Grid Jiangsu Electric Power in Nanjing, which conducted the trials.

• "Owners worry V2G might affect battery life spans. The technology is quite mature and will not damage batteries.," said Jiao Xize, a marketing staff member at the company. (China Daily, Aug. 23)