Xpeng electric car deliveries drop in October to half of Nio’s

Xpeng said deliveries of its newly launched G9 SUV surged in October from September, despite a drop in the brand’s overall monthly deliveries.

China News Service | China News Service | Getty Images

BEIJING — Chinese electric car startup Xpeng delivered about half the number of cars that rivals Nio and Li Auto did in October, according to company statements Tuesday.

While the two other startups reported monthly deliveries of more than 10,000 each, Xpeng said it delivered just 5,101 cars — a third-straight month of decline.

Xpeng shares fell by 3% in U.S. trading overnight. Nio’s rose by 0.4% and Li Auto shares jumped by 6.9%.

China’s electric car market is highly competitive. Older automakers BYD and Tesla lead monthly deliveries by far, while new entrant Huawei claims its Aito brand has topped the 10,000-a-month mark less than a year since launch.

Deliveries of Xpeng’s best-selling model, the P7 sedan, halved from September to October, with just over 2,100 units delivered last month. The company’s newly launched G9 SUV saw deliveries surge from 184 units in September to 623 units in October.

Xpeng said mass deliveries of the G9 began on Oct. 27. The company has said it expects the new model to become its best-selling car next year.


Nio, which has targeted a higher price range for both SUVs and sedans, said it delivered 10,059 vehicles in October. That marked a slight decline from September, but marked a fifth-straight month of deliveries that topped 10,000.

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“Vehicle production and delivery were constrained by operation challenges in our plants as well as supply chain volatilities due to the COVID-19 situations in certain regions in China,” Nio said in a press release.

The company said its October deliveries included vehicles sold in Europe, but not those offered under a local subscription program.

Li Auto

Li Auto delivered 10,052 vehicles in October. Since May, the company has delivered more than 10,000 cars every month, except in August.

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After having only one model on the market since 2019, Li Auto has launched three new models in the last few months — the L9 which began deliveries in August, the L8 which is set to begin deliveries this month and the L7 which is set to reach consumers early next year.

Unlike Xpeng and Nio, Li Auto’s vehicles are not purely electric as they come with a fuel tank to charge the battery and extend driving range.

Among the three companies, Li Auto’s U.S.-listed shares have held up the best in a year of broad market declines. The stock is down by about 55% so far this year, while Nio shares have dropped by 69% and Xpeng is down by 87%.

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How United thinks electric planes will change flight travel decisions

United Airlines, the nation’s No. 3 carrier, has a contract to buy electric 30-seat planes from startup Heart Aerospace, which Heart said it plans to introduce in 2028.

Heart Aerospace

One of the hardest things to figure out about cutting greenhouse gas emissions has been what to do about aviation, since most commercial jets are too heavy to fly under electric power with today’s technology. But United Airlines is beginning to provide a picture of how electric planes will be part of its future and a key to remaking the way travelers think about aviation as a choice for shorter distance routes.

The nation’s No. 3 carrier has a contract to buy electric 30-seat planes from startup Heart Aerospace, which Heart said it plans to introduce in 2028. In a twist, United’s plan is not to replace big jets, but to focus the new planes on regional service. The airline is also preparing to introduce eVTOL (electric vertical takeoff and landing) craft to do local transport like taking passengers from central cities to airports.

The idea is less to shift how fliers behave than to convince small-city residents who now drive on trips of 250 miles or less to take a plane instead, Mike Leskinen, United’s vice president of corporate development and president of its United Ventures investing arm, said at the CNBC ESG Impact earlier this month. If it works, it opens up a new market for carriers like United, especially outside major metropolitan areas.

“There’s absolutely a lot of hurdles to clear but aerospace development cycles are measured in decades and you have to get started now,” Leskinen said. “We cannot continue doing and operating our business the way we do. It is imperative that we change it and the way we’re going to change it is through investing in technology.”

As electric cars and SUVs move toward 5% of the new-car market in the U.S. and 9% globally, few airlines have made any major push toward electric planes. Sustainability plans being pursued by American Airlines, Delta Air Lines and Southwest Airlines barely mention electric planes. Engineers can’t make an electric battery light and powerful enough to serve a plane the size of today’s jets, said Eliot Lees, vice president and aviation analyst at consulting firm ICF in Cambridge, Massachusetts. 

The United plan is based on the idea that less than 1% of travelers making a 250-mile trip choose to fly.

“It used to be different,” said Anders Forslund, CEO of Gothenburg, Sweden-based Heart Aerospace, which has a contract to supply United with 100 30-seat electric planes. “Go back to the 1990s, there were hundreds of small aircraft serving a lot of communities that have now lost service.”

United and Air Canada have also bought stakes in Heart Aerospace.

Why small city plane travel stopped

People in smaller towns stopped flying because jet engines made for planes were too expensive to serve those communities profitably, Forslund said. 

“It’s a remarkable technology but it’s holding us back now,” he said. “When you bring in an electric motor … you can get a lot of synergies with what’s happening in the automotive industry. They can start building small planes that have completely different unit economics.”

Travelers will be unlikely to see any major difference in the interior of an electric-powered plane, Leskinen said. And the ability to change planes in as little as 30 minutes will mean planes can be in use 10 or 11 hours per day, allowing for flexible schedules.

“What that means is that a small city is going to either get service they didn’t have, that they had to drive to a [bigger] airport, or they’re going to have greater frequency of service,” Leskinen said at the CNBC event. “That’s going to allow that customer from that small town to make a trip in and out on the same day, whereas before you couldn’t do that with traditional jet powered aircraft.”

And the United Airlines executive predicts that these electric plans will be cheaper for the airline than traditional jet engines within a decade. “As we adopt electric aircraft, I think the cost for a 30-seat aircraft, 50-seat aircraft as the industry evolves is going to be lower cost than a traditional aircraft.”

Other airline climate change plans

Most airlines’ push to lower emissions has focused on plans to remake their existing fleet by replacing older planes with more efficient newer models. In addition, airlines, including United, are focused on investments in sustainable aviation fuel startups. The U.S. Energy Dept. says sustainable airline fuels, or SAF, emit “dramatically lower” carbon levels, but not zero, and says some SAF technologies under development could lead to negative net greenhouse gas emissions.

Delta’s announced goal is to replace 10% of fuel with SAF by 2030. It has partnered with Airbus to study hydrogen-fueled aircraft but considers SAF its primary medium-term means to reduce emissions with new technology. “We have a multi pronged strategy of things we can do today, things we can do tomorrow like investing in SAF, and investing in the future,” Fletcher said in an interview. “All of them have to start now.”

American is also pointing toward cutting emissions via moving toward sustainable fuels, according to its annual report on environmental, social and governance management. It plans to switch 10% of its fuel to SAFs by 2030, as part of a plan to reduce emissions 45% by then and to reach net zero emissions by 2050.

Even SAFs are not really there yet, due to a severe capacity crunch the industry is scrambling to fix in time for 2030, he said. The industry has been given an economic boost by the passage of President Biden’s climate legislation, which is seen as key to providing the financial incentives needed to scale these new operations. The Inflation Reduction Act Congress passed in August with several provisions targeting aviation. One is a blenders’ tax credit of $1 a gallon for biofuels designed to give incentives to build SAF plants faster, and longer-term initiatives to accelerate technologies including hydrogen-powered aircraft and point-source capture of carbon dioxide to create new green fuels, Leskinen said.

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“We have a portfolio pipeline of sustainable aviation projects at United that’s 177 companies deep, and we were pencils down on a number of those because without this legislation the hurdles were just too [high] to develop this technology,” he said. “There are literally dozens of companies that wouldn’t have worked that are now viable startups that you’ll hear about United Airlines and United Ventures investing in in the coming months.”

Early versions of SAF technology will use lipids to blend with conventional jet fuel, while Fletcher says later versions will rely on carbon capture technology that will actually make net emissions from some planes negative. 

ICF projects that 70% of the cuts in airline emissions by 2050 will come from switching to SAFs, while only 10% will come from adopting electric (or hydrogen-powered) planes. The other 20% will likely come from scheduling improvements and planes that get better fuel mileage, Lees said. 

Electric planes have already slipped behind the most aggressive promises for when they might be government-approved and ready for service, and more delays are likely, Lees said. Most likely, electric planes will serve small markets, hydrogen-powered planes will serve medium-sized passenger loads, and SAF-powered jet engines will serve major cities.

“Everyone is optimistic about these aircraft,” Lees said. “The [companies that make them] are especially optimistic about when.” 

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American, which declined comment, has invested in London-based eVTOL company Vertical Aerospace. The company’s ESG report says the four-passenger eVTOLs it expects to deploy can transport passengers between cities at up to 200 miles per hour. This can alone can be a $12 billion market by 2030, said Chris Raite, airline analyst at research firm Third Bridge Group in New York, but regulatory hurdles and supply chain issues make predictions that the technology will become common as early as 2024 unreliable.

“Our experts are very optimistic, but less optimistic about the aggressive time frames that are being marketed,” he said. 

Just this month, Delta Air Lines invested in Joby Aviation. United is also investing in eVTOL: most recently, a $15 million order with Eve Air Mobility in September including an order for 200 aircraft; and a $10 million investment in Archer Aviation and order for 100 Archer eVTOLs. But United thinks that the impact on flying from that technology will be smaller, though it could allow for a trip from a major metropolitan area to a small city within the region to be entirely carbon free. 

“eVTOL is going to change the way we live and work,” Leskinen said. “It’s not taking planes out of the sky, though. It’s taking cars off of the road. It’s going to allow us, if you live in Manhattan, to get out to the airport with predictability of seven, seven and a half minutes out to Newark. Maybe if you’re flying a regional flight, maybe you get on a Heart ES-30 aircraft and your entire trip will have been carbon free.”

How practical that is depends on both technology development and regulators, plus the rapid buildout of places for eVTOL to take off and land in cities, Raite said. The target is to make eVTOL available for about the cost of a premium Uber Black car service ride, but that may require development and approval of pilotless eVTOL craft.

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GM’s 2024 GMC Sierra EV offers electric truck alternative to Hummer

2024 Sierra EV Denali Edition 1

Source: General Motors

General Motors unveiled its latest electric pickup, the new electric GMC Sierra, and began taking reservations for a fully-loaded $107,000 version, called Sierra EV Denali Edition 1, on Thursday.

The automaker expects to begin shipping the Edition 1 in early 2024 and to add lower-priced versions of the Sierra EV — starting at around $50,000 — later that year.

It says the pickup will offer buyers something different when it begins arriving at dealers, even though it shares much of its technology with GMC’s Hummer EV pickup and SUV and the upcoming Chevrolet Silverado EV.

One of the biggest differences between the GMC’s wild Hummer EV and the new electric Sierra might be the new truck’s traditional pickup shape. GMC brand chief Duncan Aldred said that’s part of GM’s strategy.

“It’s going to attract different customers, more traditional truck buyers, whereas the Hummer EV has been attracting people from all brands, people out of exotic sports cars, for example,” Aldred said during a media briefing on Thursday. “With the Hummer EV, we found that 70% of customers with reservations are new to EVs, and about 75% of them are new to the GMC brand.”

“This is going to have a different feel, really appeal to the loyalists,” he said.

2024 Sierra EV Denali Edition 1

Source: General Motors

Like the Hummer pickup and the Silverado, the GMC Sierra EV will have about 400 miles of range, fast-charging capabilities, and the four-wheel “crab walk” steering that has become a popular feature with early Hummer owners.

But unlike the Silverado, which will be offered initially in a “Work Truck” variant for about $40,000 with higher-priced versions to follow, GMC will lead with the most expensive version of its new Sierra EV.

2024 Sierra EV Denali Edition 1

Source: General Motors

Highlights of the Sierra EV Denali Edition 1 include a “max power mode,” which will deliver an estimated 754 horsepower and 785 pounds-feet of torque; a version of GM’s Super Cruise hands-free highway driving system that works with a trailer; 800-volt fast-charging capability that will add up to 100 miles of range in just 10 minutes with a 350-kilowatt fast charger; and some clever storage options that take advantage of the Ultium EV architecture’s flat floor.  

Echoing a popular feature of rival Ford‘s electric F-150 Lightning pickup, the Sierra EV will be able to serve as a mobile power source, with 10.2 kilowatts of power available through up to 10 outlets and the ability to power a home for several days during an outage.

2024 Sierra EV Denali Edition 1

Source: General Motors

Aldred said that while the Edition 1 is expensive, later Sierra EVs will be priced to compete with rivals like the Lightning, which starts at about $52,000. Another rival, the smaller Rivian R1T pickup, starts at $73,000.

“The average light-duty [internal combustion] Sierra today transacts at an average of $65,000, and the segment [average] is just below $60,000,” Aldred said. “That means we’ll be putting a Sierra EV into the heart of the pickup segment.”

While the high-priced Edition 1 should generate strong profit margins for GM, the lower-priced versions will be key to the company’s plan to rapidly ramp up sales of EVs in the middle of the decade while remaining profitable. CEO Mary Barra has said that GM will transition fully to EVs by 2035.

General Motors will report its third-quarter results before the U.S. markets open on Tuesday.

Stellantis debuts electric Jeep, pledges new energy target

The Stellantis CEO Carlos Tavares, photographed in Turin, Italy, on March 31, 2022.

Stefano Guidi | Getty Images News | Getty Images

The CEO of Stellantis told CNBC Monday that the company would use its own sites to generate half the energy it needs for manufacturing by the middle of this decade.

“We have decided the appropriate investments for Stellantis to be able, from a manufacturing standpoint, in 2025 to produce 50% of our energy needs within our own sites,” Carlos Tavares, who was speaking to CNBC’s Charlotte Reed at Paris Motor Show, said.

Tavares’ comments came as Stellantis geared up to debut what he called the “first pure-EV Jeep” after details of the vehicle were published last month.

According to Stellantis, the Jeep Avenger’s “targeted electric range” is 400 kilometers, or a little under 249 miles.

The firm — whose brands include Fiat, Chrysler and Citroen — is set to open up reservations for the Avenger on Monday, and it’s slated to arrive in showrooms next year.

Stellantis wants all passenger sales in Europe to be battery electric by the year 2030. In the U.S., it wants a “50% passenger car and light-duty truck BEV sales mix” within the same timeframe.

Stellantis’ electric vehicle plans put it in competition with firms such as Elon Musk’s Tesla as well as companies like Volkswagen, Ford, and GM. According to the International Energy Agency, electric vehicle sales are on course to hit an all-time high this year.

The $7,500 electric vehicle tax credit’s full value may be hard to get

Tomekbudujedomek | Moment | Getty Images

The historic climate legislation President Joe Biden signed in August offered a federal tax break — worth up to $7,500 — to households that buy new electric vehicles.

But it may be tough for consumers to get the full value of the tax credit — at least initially.

That’s largely due to the structure of the clean vehicle credit and certain requirements for consumers and car manufacturers. Those roadblocks, however, are poised to ease in the longer term, experts said.

The tax credit ‘bummer’: It’s nonrefundable

The legislation, called the Inflation Reduction Act, made the tax credit “nonrefundable.”

That means consumers can only get the full financial benefit if they have a federal tax liability of at least $7,500. A nonrefundable credit offsets a consumer’s federal tax bill but any leftover value is lost.

Let’s say a consumer buys an electric vehicle today. When filing their 2022 tax return, the person finds they owe $5,000 in federal taxes. This person wouldn’t get the full $7,500 tax credit — they’d be able to claim $5,000 and cut their tax bill to zero. But the remaining $2,500 would be lost. In other words, those funds wouldn’t be issued to the consumer in a tax refund.

In addition, unlike some other tax credits in the bill — such as the “residential clean energy” credit for home solar panels and other installations — any unused value doesn’t carry over to future tax years to offset a future tax bill.

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“That’s kind of the bummer” of the credit, said Dan Herron, a certified public accountant and certified financial planner based in San Luis Obispo, California.

High-income consumers would generally be most likely to benefit from the full credit value relative to those with more modest earnings, since they typically have larger tax bills, Herron said. But the credit comes with some additional restrictions — such as an income cap, explained in more detail below — that will restrict how many of those households can benefit.

Meanwhile, middle- and lower-income buyers typically have smaller tax bills, meaning it’s more likely they wouldn’t collect the full credit, Herron said.

States, municipalities and utilities may also offer financial incentives for electric vehicle purchases.

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“If you can harvest some gains or have additional income you can pull into 2022, maybe you consider that,” Herron said.

Workers can also adjust the tax withholding on their paychecks, opting to withhold less and thereby increasing the taxes they owe.

However, Herron doesn’t recommend this route due to potential unknowns. For example, an unexpected bonus during the year might mean a larger-than-expected annual tax bill, depending on the withholding adjustment.   

Parameters that may reduce the credit

Sinology | Moment | Getty Images

There’s a lot of uncertainty.

Joel Levin

executive director of Plug In America

Two other rules apply to manufacturing: One carries requirements for sourcing of the car battery’s critical minerals; the second requires a share of battery components be manufactured and assembled in North America. Consumers lose half the tax credit’s value — up to $3,750 — if one of those requirements isn’t met; they’d lose the full $7,500 for failing to meet both.

It’s unclear which electric vehicles will meet these standards and qualify for a tax credit next year. There’s a chance none may immediately qualify, according to the Alliance for Automotive Innovation.

“There’s a lot of uncertainty,” said Joel Levin, executive director of Plug In America.

“If you need a car, I think it’s risky to delay buying in hopes of getting the credit,” he added. “It may not work out or it may be a couple years until it’s eligible.”

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One other consideration: Consumers who buy a Tesla or General Motors model before the tighter rules kick in Jan. 1 aren’t eligible for a tax break based on earlier parameters around sales caps that are set to lapse at the end of the year.

There’s also another option: buying a used EV instead of new one.

The Inflation Reduction Act created a “credit for previously owned clean vehicles” worth up to $4,000 starting in 2023. The tax break comes with some restrictions (like a $25,000 cap on the car’s sticker price and lower income caps for consumers) but doesn’t carry the manufacturing and assembly requirements of new cars.

A more consumer-friendly option

Consumers who are willing to wait until 2024 to buy a new or used car — and get the associated tax break — will have the most consumer-friendly option at their disposal, experts said.

That’s because the climate law will then allow a buyer to transfer their tax credit to the car dealer. A dealer — which must register with the U.S. Department of the Treasury — would get an advance payment of the consumer’s tax credit from the federal government.

As a result, consumers can likely receive the full tax credit at the point of sale from the car dealer as a discount on the sticker price or a reduction in the vehicle’s down payment, Levin said. And they’ll get that discount even if they don’t have a tax liability, he added.

“It makes the credit much more valuable to people, especially people who are of moderate income and don’t have a lot of money sitting in their pockets for the down payment,” Levin said.

Polestar confirms it will deliver 50,000 electric vehicles in 2022

Polestar, the Swedish electric performance car company, has announced that the world premiere of its next car, the Polestar 3 electric performance SUV, will be in October 2022. Polestar 3 is the company’s first SUV.

Courtesy: Polestar

Swedish electric vehicle maker Polestar said Friday that it is still on track to deliver 50,000 vehicles in 2022 after its factory resumed full production following disruptions from Covid outbreaks in China.

Polestar said it delivered 9,215 vehicles in the third quarter, bringing its total deliveries so far this year to about 30,400 vehicles. That’s roughly double its total from a year ago — but the fourth quarter will be critical for the company’s goals.

Polestar’s shares were up about 3% in premarket trading following the news.

CEO Thomas Ingenlath said in a statement that he’s confident Polestar will hit its target, as it’s already shipping many of the cars it expects to deliver by year-end.

“We needed to catch up on production after Covid-19 related setbacks in China and we have,” Ingenlath said.

Polestar’s corporate parent, Chinese automaker Geely, had to idle its Luqiao factory for several weeks in the first half of 2022 because of government-mandated Covid-19 lockdowns. That factory makes the Polestar 2 crossover as well as models for other Geely brands.

Polestar is a joint venture between Sweden’s Volvo Cars and Geely, which has owned Volvo Cars since 2010. It went public via a merger with a special purpose acquisition company in June.

Polestar’s next model, an SUV called Polestar 3, will be made in both Luqiao and the U.S., where it will be produced at a Volvo plant in South Carolina. The Polestar 3 is expected to make its formal debut at an event in Copenhagen on Wednesday, with production beginning soon thereafter.

Electric and autonomous vehicle ETF falls 15% in September

GMC vehicles sit on display at the Sterling McCall Buick GMC dealership on February 02, 2022 in Houston, Texas.

Brandon Bell | Getty Images

A key ETF for electric and autonomous vehicle stocks suffered an ugly month in September, falling nearly 15% amid fears a recession could slow revenue for the automakers.

The Global X Autonomous and Electric Vehicles ETF closed on Friday at about $20, more than 37% off the group’s 52-week high. It was the second worst-performing month for the group on a percentage basis on record, behind only March 2020 when the overall stock market saw dramatic declines.

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Investors are growing concerned that the potential for a recession won’t deter the Federal Reserve Bank from its plan to continue hiking interest rates, which in turn could make new vehicles more costly for consumers and businesses that need to finance the purchases.

Consumers are already grappling with sticker prices that are higher than ever – and with tight supplies that have led some dealers to demand additional premiums. According to J.D. Power estimates, the average transaction price for a new car sold in August was $46,259, the highest on record.

TrueCar analyst Zack Krelle thinks consumers are already beginning to balk at those high prices, especially as inflation drives their other expenses higher – and especially as interest rates continue to rise.

“We’re seeing consumers faced with the reality that to afford the same vehicle at the same monthly payment as last year, they are forced to increase their down payment, which is creating new affordability challenges,” Krelle said in a statement on Thursday. “With increasing interest rates, affordability is being tested.”

It’s likely that automakers’ profits will slump if the U.S. enters a recession. That has put pressure on the stocks of auto giants like Ford Motor (down 27% in September), General Motors (down 18%), and Volkswagen (down 13%), all of which are included in the ETF’s holdings.

It’s also pressuring shares of the suppliers and startups in the EV and autonomous-driving spaces that make up the majority of the ETF’s portfolio. Not only would a recession limit automakers’ ability to invest in new technologies, but higher interest rates — and the market weakness that could accompany a recession — would also make it harder for those smaller companies to raise additional capital from other investors.

Most major automakers are prepared to ride out a recession. But many of the smaller companies in the EV and self-driving spaces could struggle. Some of the names that have attracted investor attention over the last couple of years are still a long way from sustainable profitability and are likely to need additional cash infusions over the next few years.

Some, like EV battery startup QuantumScape (a constituent of the ETF, down 21% in September) may not even have meaningful revenue for several more quarters, much less profits.

Among the ETF’s other big movers in September:

  • Lidar maker Luminar Technologies was down 13% for the month.
  • Chinese electric-vehicle makers Nio and XPeng ended the month down 20% and 34%, respectively.
  • Electric heavy-truck maker Nikola fell 35% in September.

— CNBC’s Gina Francolla contributed to this report.

China’s new electric cars cost more to insure than fuel-powered cars

In China, new energy vehicles typically receive green license plates – which is often easier for residents to apply for versus the blue license plate of a traditional fuel-powered car.

Vcg | Visual China Group | Getty Images

BEIJING — While Chinese companies churn out new electric cars, local insurance firms think they’re more expensive to cover.

In general, the insurance premium for new energy cars — which includes electric — is about 20% higher than it would be for comparable traditional fuel-powered cars, said Wenwen Chen, director at S&P Global Ratings, who leads the firm’s research for China insurance.

Many factors go into determining pricing. But Chen said insurance companies find that the loss ratio — a measure of cost for insurers — tends to be higher for new energy vehicles than for internal combustion engine cars.

One of the main reasons she cited for a higher loss ratio is more accidents, especially more costly ones — since new energy vehicles often use parts that aren’t mass-produced yet.

In the U.S., insurance for electric cars also tends to be about 15% more expensive than that for combustion engine cars — primarily because electric cars in the U.S. tend to be luxury vehicles, according to Chase Gardner at Insurify, which compares car insurance rates in the U.S.

But repair costs are another reason for higher insurance prices, since “fewer places have the capability to service electric cars in the U.S.,” Gardner said. “Generally people who drive EVs end up paying lower maintenance costs over time. Again, the big question is, do you get into an accident?”

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In the U.S., Insurify’s analysis of the U.S. market found there was no difference in accident rates among electric cars, hybrids and combustion engine cars.

But by official Chinese statistics, new energy vehicles in the country are more prone to fires than traditional fuel-powered ones. In the first quarter, 640 new energy vehicles reported fires, 32% higher than a year ago, according to the Ministry of Emergency Management’s Fire and Rescue Department.

That increase was far more than the 8.8% increase in fires for transportation vehicles overall, the ministry said. More recent figures weren’t available. The ministry didn’t respond to a CNBC request for comment.

For all of 2021, the ministry reported at least 3,000 new energy vehicle fires. It said the risk of fire was generally higher for such cars than for traditional vehicles, without disclosing specific figures.

The growing number of fires comes as the number of new energy vehicles has surged in China.

From January to August, 3.26 million new energy passenger cars were sold — more than double the same period last year and about 25% of all passenger cars sold in the country, according to the China Passenger Car Association. That share was about 15% last year.

In contrast, new energy vehicles remain a far smaller part of the U.S. auto market.

Hybrid, plug-in hybrid and electric vehicles accounted for 11% of light-duty vehicle sales in the U.S. in the fourth quarter of 2021, said the U.S. Energy Information Administration, citing data from Wards Intelligence. A more recent report wasn’t available. Light-duty vehicles also include pick-up trucks and vans.

A surge of new cars

China, home to the world’s largest auto market, has supported growth in new energy vehicles with policies that make it easier to get license plates, as well as subsidizing purchases.

For the first seven months of this year, tax exemptions for new energy vehicle purchases totaled 40.68 billion yuan ($5.9 billion) — and the equivalent of more than $1 billion in July alone, according to official figures. The tax administration said both amounts were more than twice what they were from a year ago.

Many Chinese companies have rushed to launch new energy vehicles, although it’s unclear what their specific accident risk is.

New energy vehicles tend to be simpler, especially in design, than internal combustion vehicles, said Cui Dongshu, secretary-general at the China Passenger Car Association.

Electric cars are based on a platform system, and certifying safety can be faster, he said, noting potential use of virtual testing scenarios, or the ability to test individual parts.

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In less than a year, Chinese telecommunications and smartphone giant Huawei partnered with automaker Seres to launch three new energy vehicles under the Aito brand. The cars are the first to use Huawei’s HarmonyOS operating system.

At a launch event in July, Huawei Consumer Business Group CEO Richard Yu boasted how quickly his team and Seres were able to conduct many vehicle safety tests in such a short period of time, to develop and launch two models in just over a year.

“In the hundred years of the auto industry, there’s no record of anyone doing it so fast before,” Yu said in Mandarin, translated by CNBC.

Two of the three cars have already reached consumers. Deliveries of the first model topped 10,000 units in just 87 days — an industry record for a new car brand, Huawei claimed in August.

Typically it takes three to four years for the manufacture and development of a car, said Helen Chai, consulting director at China Insights Consultancy. She said if the car is based on an existing one, a new model would only take two to three years.

She said the steps for developing and certifying a new energy vehicle and an internal combustion engine car are generally the same.

Other local players are quickly launching new models, although, notably, Tesla hasn’t.

For example, in the last 12 months, Nio began deliveries of its first electric sedan, launched a second sedan — and launched and delivered a new SUV.

Last year, Baidu and Geely announced the launch of their joint electric car project, Jidu. Next year, the first Jidu car is set to begin customer deliveries.

Huawei had no comment. Nio and Jidu did not respond to a CNBC request for comment.

Electric vehicle (EV) sales set to hit an all-time high in 2022, IEA says

Tesla electric cars photographed in Germany on March 21, 2022. According to the International Energy Agency, electric vehicle sales are on course to hit an “all-time high” this year.

Sean Gallup | Getty Images News | Getty Images

Electric vehicle sales are on course to hit an all-time high this year, but more work is needed in other sectors to put the planet on course for net-zero emissions by 2050, according to the International Energy Agency.

In an announcement accompanying its Tracking Clean Energy Progress update, the IEA said there had been “encouraging signs of progress across a number of sectors” but cautioned that “stronger efforts” were required to put the world “on track to reach net zero emissions” by the middle of this century.

The TCEP, which is published yearly, looked at 55 parts of the energy system. Focusing on 2021, it analyzed these components’ progression when it came to hitting “key medium-term milestones by the end of this decade,” as laid out in the Paris-based organization’s net-zero pathway.

On the EV front, the IEA said global sales had doubled in 2021 to represent nearly 9% of the car market. Looking forward, 2022 was “expected to see another all-time high for electric vehicle sales, lifting them to 13% of total light duty vehicle sales globally.”

The IEA has previously stated that electric vehicle sales hit 6.6 million in 2021. In the first quarter of 2022, EV sales came to 2 million, a 75% increase compared to the first three months of 2021.

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The IEA said both EVs and lighting — where more than 50% of the worldwide market is now using LED tech — were “fully on track for their 2030 milestones” in its net-zero by 2050 scenario.

Despite the outlook for EVs, the IEA separately noted that they were “not yet a global phenomenon. Sales in developing and emerging countries have been slow due to higher purchase costs and a lack of charging infrastructure availability.”

Overall, the rest of the picture is a more challenging one. The IEA noted that 23 areas were “not on track” with a further 30 deemed as needing more effort.

“Areas not on track include improving the energy efficiency of building designs, developing clean and efficient district heating, phasing out coal-fired power generation, eliminating methane flaring, shifting aviation and shipping to cleaner fuels, and making cement, chemical and steel production cleaner,” the IEA said.

The shadow of 2015’s Paris Agreement looms large over the IEA’s report. Described by the United Nations as a “legally binding international treaty on climate change,” the accord aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”

Cutting human-made carbon dioxide emissions to net-zero by 2050 is seen as crucial when it comes to meeting the 1.5 degrees Celsius target.

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In a statement issued Thursday the IEA’s executive director, Fatih Birol, appeared cautiously optimistic. “There are more signs than ever that the new global energy economy is advancing strongly,” he said.

“This reaffirms my belief that today’s global energy crisis can be a turning point towards a cleaner, more affordable and more secure energy system,” he added.

“But this new IEA analysis shows the need for greater and sustained efforts across a range of technologies and sectors to ensure the world can meet its energy and climate goals.”

The IEA’s report comes at a time when the debate and discussion about climate goals and the future of energy has become increasingly fierce.

This week, the U.N. secretary general said developed economies should impose an extra tax on the profits of fossil fuel firms, with the funds diverted to countries affected by climate change and households struggling with the cost-of-living crisis.

In a wide-ranging address to the U.N. General Assembly in New York, Antonio Guterres described the fossil fuel industry as “feasting on hundreds of billions of dollars in subsidies and windfall profits while households’ budgets shrink and our planet burns.”

GM to sell up to 175,000 electric vehicles to Hertz through 2027

2024 Chevrolet Blazer SS EV


General Motors has agreed to sell up to 175,000 electric vehicles to Hertz Global over the next five years, the companies announced Tuesday.

The deal calls for GM to start supplying electric vehicles such as the Chevrolet Bolt EV and Bolt EUV to the rental car giant starting the first quarter of next year. Those vehicles are expected to be followed by newer EV models on the company’s Ultium battery technology, such as the Chevrolet Blazer, Chevrolet Equinox and vehicles from GM’s other brands.

GM is expected to significantly increase its production of all-electric vehicles in the coming years, as North American output of the cars and trucks — as well as the battery cells used to power them — increases. The company plans to reach production capability of 1 million EVs in North America and China, each, by 2025.

GM is the latest automaker to strike such an agreement with Hertz following Tesla and Polestar, a Volvo-backed electric vehicle startup. Those agreements were for 100,000 and 65,000 vehicles, respectively, making GM’s deal the largest of the three.

“Our work with Hertz is a huge step forward for emissions reduction and EV adoption that will help create thousands of new EV customers for GM,” CEO Mary Barra said in a statement.

Hertz has made increasing its fleet of electric vehicles a priority following its emergence from bankruptcy less than a year ago. The debt-laden company was an early victim of the coronavirus pandemic but has since recovered amid surging demand in travel and supply chain issues. The problems have resulted in lower inventories but higher profits for rental car fleets.

Shares of GM and Hertz were relatively unimpacted by the announcement. Both were down midday Tuesday amid a broader market decline.

Investors have traditionally frowned upon automakers when they sell large amounts of vehicles to daily rental fleets. That’s because cars and trucks sold to rental companies are usually sold at a discount, with such deals used to reduce bloating inventories and increase their total vehicle deliveries.

However, shareholders and analysts have responded favorably to automakers such as Tesla selling EVs to Hertz, viewing the move as a sign that battery-electric cars were going more mainstream.

Hertz aims to have a quarter of its fleet be electric by the end of 2024, while GM has announced plans to exclusively offer electric vehicles by 2035.

GM CEO Mary Barra discusses new electric Chevy Equinox and EV production plans