Dutch EV Demand Cliff Debunked
Credit to Author: Maarten Vinkhuyzen| Date: Wed, 29 Jan 2020 06:00:18 +0000
Published on January 29th, 2020 | by Maarten Vinkhuyzen
January 29th, 2020 by Maarten Vinkhuyzen
All markets have their peculiarities. Especially around the end of one year and the start of the next. Consumers look for presents and fun shopping for the holidays. Companies have to spend their budget or wait for the new budget next year.
The Dutch car market is no exception to this rule. In December there are normally just 50% of normal deliveries, followed by a January having approximately 150% of normal deliveries. That is of course without external forces distorting this pattern. The best way to look at these two months is to add them together and spread the result evenly over the two of them.
This turn of the year we had the (in)famous EV incentive change. There was a significant pull forward from the new year’s EV sales into the old year’s tax rules.
The big question was how big a pull forward it was, and what the effect would be on sales in 2020. Tesla watchers were especially concerned (bulls) or hopeful (bears) that the 2020 sales of the Model 3 would mirror the 2019 sales of the Model S & Model X after the 2018 incentive change for these cars.
In 2018 the S & X sold in record numbers, an extra 5,000 vehicles or 150% above normal, followed by three quarters that were close to zero. Only the fourth quarter of 2019 returned to normal.
The pull forward of this year’s end-of-incentive rush was a lot smaller. Probably because the incentive was just lowered a bit, not removed fully. Enough to take action, but not enough for more extreme measures.
We are now near the end of January and we can see the likely numbers of deliveries forming. Combining January with December, we reach what is an above-average two-month result of ~86,000 vehicles delivered. But this is normal for these two months. We normally see higher numbers after the new model year models are available at the end of the year and again before the vacation season in early summer, with lower sales in between.
My prediction for Q4 2019 and Q1 2020 is a BEV market share of >20%. This is based on a combined market share of over 19% for Q3 and Q4. The Tesla market share of the BEV market might shrink to “just” 40% in Q1 2020. With the growing sales of all the new models in 2020, Tesla can even grow its numbers while the market share gets lower, to 30–35% of the BEV market. That is coming down from the 2019 number of 48.5% (nearly half of all BEVs sold).
Dutch BEV sales grew strongly over the last three years, with 88% (2017), 202% (2018), and 157% (2019) growth. That was without advertising or many new longer range, faster charging, affordably priced models in the show rooms. This year will be different.
Am I too optimistic hoping for just 100% growth?
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Maarten Vinkhuyzen Grumpy old man. The best thing I did with my life was raising two kids. Only finished primary education, but when you don’t go to school, you have lots of time to read. I switched from accounting to software development and ended my career as system integrator and architect. My 2007 boss got two electric Lotus Elise cars to show policymakers the future direction of energy and transportation. And I have been looking to replace my diesel cars with electric vehicles ever since. And putting my money where my mouth is, I have bought Tesla shares. Intend to keep them until I can trade them for a Tesla car.