Original by New Energy Outlook (ID: xinnengyuanqianzhan)

2508 words, 6-minute read

The micro electric vehicle market, which has been on a downward trend for nearly two years, has made a full recovery.

Public data shows that sales of micro electric vehicles exceeded 970,000 units in the first 10 months of this year. In its peak year of 2022, sales reached 1.08 million units, showing a trend of surpassing that figure.

With the market gradually becoming saturated, consumer demand shrinking, and the release of new standards for reducing or exempting the purchase tax on new energy vehicles, public enthusiasm for micro electric vehicles has waned, and sales have continued to decline, hitting a low point of only 300,000 units in the first half of 2023.

So why did it "turn red" in 2024? Industry insiders believe that new energy vehicle companies have continued to make efforts in the niche market, with micro electric vehicles constantly launching new products. Some pure electric micro cars even use CATL batteries, enhancing product competitiveness and breaking some consumers' ingrained perceptions of micro electric vehicles having low range and poor quality.

1. Micro electric vehicles have "revived"

The cause and effect of this seem to date back to that summer of 2020.

At that time, the launch of the Wuling Hongguang MINI EV brought micro electric vehicle travel into the public eye.

In the subsequent two and a half years, a group of micro electric vehicles represented by the Wuling Hongguang MINI EV became well-known in the market. Their total annual retail sales peaked at 1.08 million units in 2022.

Image/Wuling Hongguang MINI EV

Source/Screenshot from New Energy Outlook on the Internet

However, the good times didn't last long. The micro electric vehicle market faced a dark moment in 2023, with total annual retail sales of 946,000 units, a decrease of 12% compared to the same period in 2022.

Entering 2024, influenced by factors such as trade-in policies, the launch of multiple new micro models, continuous improvement in product capabilities, and declining battery-grade lithium iron phosphate prices, the micro electric vehicle market began to recover with a relatively stable posture.

The latest statistics from the China Passenger Car Association show that from January to September 2024, cumulative retail sales of A00-class (micro) pure electric vehicles reached 796,000 units, a year-on-year increase of 29.2%. This growth rate was second only to that of C-class vehicles at 67.8% among all levels of pure electric models.

Specifically, for brands, Besturn Pony, a sub-brand of FAW Besturn, sold 11,377 units in October alone, accounting for over 60% of Besturn's monthly sales and achieving sales of over 10,000 units for two consecutive months. Wuling Hongguang MINI EV ranked high on the list of new energy vehicle sales in October, reaching 42,165 units, with a month-on-month increase of 101.7%.

"The A00-class market has returned to the competitive landscape of 20 years ago. Recently, diversified A00-class main models and new products from Geely, Changan, Chery, and others have performed outstandingly, and micro electric vehicles are gradually demonstrating incremental potential," said Cui Dongshu, Secretary-General of the China Passenger Car Association.

Industry insiders believe that although micro electric vehicles are no longer the leader in the niche market in terms of overall sales, they still have considerable market potential.

In contact with New Energy Outlook, most consumers indicated that micro electric vehicles are significantly cheaper than other models in terms of price and usage costs. Due to their compact size, they are also convenient for driving and parking in the city.

Based on this market dividend, many auto companies have continued to layout this segment. New micro electric vehicle models that have been launched from the end of October to early November 2024 include the Besturn Pony Long Range Edition, 2025 Geely Panda Kart, 2025 Geely Panda Knight, and 2025 Lingbao BOX Honey Pomelo Edition.

Image/Panda Kart/Knight

Source/Screenshot from New Energy Outlook on the Internet

2. From the "old man's joy" of yesteryear to the "youth's joy" of today

With the resurgence in demand for the micro electric vehicle market at this stage, an interesting question arises: Who is buying micro electric vehicles?

Looking back at those who used to buy tricycles with roofs, it seems that most of them were elderly people, hence the nickname "old man's joy" for micro electric tricycles or quadricycles.

But what about today's micro electric vehicles?"In contact with New Energy Outlook, the answer gradually emerged.

These micro electric vehicles, which require a license plate and driver's license, are mostly used by young people. After segmenting income, it is not difficult to find that the portraits of these young consumers are mostly those with limited financial means who need short-distance travel on a daily basis.

Fan Xing (pseudonym) from Wenzhou drives a Wuling Hongguang MINI EV. She introduced that since she has just started working for a short time and has little savings, a low-priced micro electric vehicle is the best choice for her in this situation.

"This mini electric car is affordable for me, and my daily commute is a straight line between home and work, a one-way trip of only a dozen kilometers. The range of the Hongguang MINI EV is more than enough."

Duoduo (pseudonym) is a junior college student. She recently bought a Besturn Pony. "I occasionally go to a painting training institution to work part-time after class. The time for teaching children is usually after school or on weekends, with unfixed schedules. At this time, it takes more effort to commute by subway and bus. After weighing the options, buying a low-priced and low-cost micro electric car became the best solution for short-distance travel around the school."

Image/Besturn Pony

Source/Screenshot from New Energy Outlook on the Internet

"I bought this car just for its low price. It costs less than 100 yuan to charge it every month. If you include annual insurance costs and routine maintenance expenses, the average monthly expenditure is at most 400 yuan," said Ms. Chi, the owner of a Changan Lumin.

A salesperson at a 4S store frankly stated, "Judging from store sales, most consumers who come to buy A00-class electric vehicles are young people. Besides being attracted by their appearance and low price, intelligence and a sense of technology are also important considerations for them."

It should be noted that regarding the situation where the increased threshold for purchase tax exemption will directly affect electric vehicles with a range of less than 200 km, as mentioned at the beginning of the article, several consumers who have recently expressed interest in purchasing micro electric vehicles stated, "The total cost of a micro electric vehicle is only a few tens of thousands of yuan, so the impact of whether or not the purchase tax is exempted is not significant. Moreover, many brands have launched micro electric vehicles with a range of over 200 km this year, so the impact is minimal."

3. Troubles from micro electric vehicles: Saving money but not worry-free

When it comes to micro electric vehicles, most people believe that this "mini version" of a daily commuting tool is more cost-effective than other "large" electric vehicles.

However, as the saying goes, it's easy to find something that saves money but hard to find something that saves worry.

After driving for a while, owners of micro electric vehicles generally have their own troubles.

"It's true that it's easy to park, but it's also true that it's easy to get cut off or squeezed by other cars."

"This range is enough for driving around the city, but occasionally when I want to go on a road trip like other electric car owners, the range is like a kite string, too short."

"It's expected that the safety factor is low, but I can't stand the uneven tire wear caused by the suspension!"

Looking at the micro electric vehicle market as a whole, it is not difficult to find that this trouble is not unique to individual micro electric vehicles; it seems to be a common problem among all currently available micro electric vehicles on the market, which is obviously related to their inherent limitations.

Specifically, in terms of range, the battery capacity of micro electric vehicles is usually relatively small, which directly limits their range performance. Currently, the best pure electric range of micro electric vehicles available on the market is a little over 200 km, while "medium and large" pure electric vehicles with a range of over 500 km are commonplace.

Image/Lingbao BOX Honey Pomelo Edition

Source/Screenshot from New Energy Outlook on the Internet

In terms of safety, due to cost considerations, micro electric vehicles are much weaker than other pure electric vehicles in terms of body structure and safety configuration. At the same time, their smaller size directly affects their energy-absorbing and crushing space. When an accidental collision occurs, it is more likely to cause injuries to occupants compared to other models.

In terms of intelligence, most micro electric vehicles currently equipped with intelligent functions are still at a basic stage. In contrast, the intelligent driving of pure electric models such as the XPeng MONA M03 and Geely Yue 07 has already entered a relatively mature application stage, enabling functions such as automatic parking, highway piloted driving, and urban road navigation-assisted driving.

Image/Chery QQ Ice Cream

Source/Screenshot from New Energy Outlook on the Internet

Behind these pain points, does the existence of micro electric vehicles still make sense?

The fact is that although micro electric vehicles can only be used in fixed scenarios such as picking up and dropping off children and daily commuting, they do provide convenience for consumers' travel and fulfill the dream of "owning a car" for some young people on the road to replacing gasoline vehicles with electric ones. Therefore, from this perspective, micro electric vehicles have certain significance and value in accelerating the comprehensive popularization of new energy vehicles in the market."In the future, for micro electric vehicles to maximize their effectiveness and achieve smoother progress towards full electrification, auto companies should continue to take action and focus on high-quality and differentiated products. After all, in today's consumer mindset, people are willing to pay for low prices but not for low quality.