Will 2021 Be The Year Of Transformation Into New Energy? The Giants Enter a Period Of Accelerated Iteration

In 2021, it seems as if the global automotive giants are being pushed to accelerate their transition to new energy, with announcements being made at a frequency of almost "one a month" to discontinue the production or sale of fuel-efficient vehicles in the future.

First, in February, Jaguar Land Rover announced that it would become an all-electric luxury brand and would no longer produce fuel-efficient vehicles from 2025, and in March, Volvo announced that it would become an all-electric luxury brand by 2030 and that all its all-electric models would be sold online only. Volvo will "phase out all models with internal combustion engines (ICE) from its global product line-up, including hybrids" and "aim to become a leader in the fast-growing premium electric vehicle market".

In April, Honda announced that it would electrify all of its models by 2040, ending production of vehicles with pure internal combustion engines in a move to achieve carbon neutrality and advance the development of zero-emission powertrain solutions by 2050. Shell Finance reporters combing through car companies' plans for the Chinese market, Honda hopes to launch more than 10 electrified models in the Chinese market by 2023 and capture more than 50% of the electrified model market share by 2025.

Since May, the German trio has been transforming. Veteran luxury brand BMW announced that it expects half of its current engine powertrains to be discontinued by 2025, and half of its car sales to come from electric vehicles by 2030.

In June, the CEO of Volkswagen Audi announced that Audi would cease production of diesel, petrol and hybrid cars from 2026. The following month, Mercedes-Benz also announced that it would be fully prepared to go fully electric by 2030, and that from 2025 onwards, all new model launches will have an all-electric platform architecture, with every model offering a pure electric version option to customers. To drive these transformations, investments in purely electric Mercedes-Benz models will exceed €40 billion between 2022 and 2030.

The ultra-luxury brands are not far behind, with Lamborghini opening the year by announcing that this will be the last year of conventional internal combustion engines at Lamborghini, which has allocated €1.5 billion to the new energy transformation and plans to launch purely electric models after 2025.

Also in June 2021, German stalwart Volkswagen announced the cessation of production of petrol and diesel-engined cars in Europe as early as 2033 in order to accelerate the move to electric vehicles.

"2021 can be said to be the first year of the transition of international car giants to new energy vehicles," Zhang Xiang said, adding that in 2021, there will be greater changes in environmental protection policies in Europe and the United States, and subsidies for new energy vehicles in China have also been withdrawn. In the context of the global increase in environmental protection, car companies have announced plans to stop production and sale of fuel vehicles.

Zhang Xiang said, Volkswagen, Toyota's fuel cars have brought a lot of profits for the enterprise, once the rapid "cut" fuel cars, will lose a lot of profits. Therefore, in the process of transition, companies must also consider speed and sales. For example, VW's MEB platform, which can be produced in Europe or in China, can be used to share R&D costs.

Cui Dongshu, for his part, said that the European new energy vehicle market saw explosive growth as early as 2020, with new energy vehicle sales up 120% year-on-year, due to strict EU regulations forcing car companies such as Germany and France to produce a large number of new energy vehicles to achieve a precipitous drop in carbon emissions. With the acceleration of the new energy process in the European market, new energy vehicles are replacing traditional vehicles as the new blue ocean of the market with huge potential for future development.

According to the new EU emissions regulations, from 2020 onwards, 95% of new vehicles produced by European car manufacturers must achieve an average CO2 emission of no more than 95 grams per kilometre; in 2021, 100% of new vehicles must meet these standards. If the standard is not met, a fine of €95 per gram of CO2 per vehicle will be imposed.