Since Q1 contains Chinese New Year holiday, it is the traditional automobile demand slack season. According to the data from the China Association of Automobile Manufacturers, from January to March 2024, China’s new energy vehicle (NEV) output and sales volume hit 2.115 million and 2.09 million respectively, down 34.65% and 34.16% from that in Q4, 2023 owing to seasonality but up 28.2% and 31.8% Y-O-Y. Therein, the sales volume of battery electric vehicles (BEV) was 1.305 million, up 13.3% Y-O-Y, while the sales of hybrid electric vehicles (HEV) were 0.784 million, up 81.2% Y-O-Y. From the perspective of sales, the NEV penetration rate has reached 31.1%.

For LNG heavy-duty truck sales volume, it usually fluctuates violently, affected by the changes in LNG prices. LNG prices are normally at high levels in Q4, because the LNG demand for heating in the season is strong, so the LNG heavy-duty truck sales volume is usually at a low level in Q4. In 2023, the overall LNG prices were in a downtrend, so the LNG heavy-duty truck monthly sales volume stayed at over 10,000 from March to November and hit an all-time high of over 24,000 in September. At the beginning of 2024, as the heating demand buoyed the LNG prices, LNG enjoyed less economies against diesel for heavy-duty trucks, so the LNG heavy-duty truck sales volume in January and February were both below 10,000. In March, LNG retail prices dipped by 5.28% M-O-M, and in the meantime, the prices of diesel went up. Therefore, LNG enjoyed economies again, and the LNG heavy-duty truck sales volume refreshed a new record of over 29,000 in March. On the whole, as per SCI’s data, from January to March 2024, China’s total LNG heavy-duty truck sales volume hit 45,300, up 1.6% from that in Q4, 2023 and up 135.4% Y-O-Y.

SCI predicts that as of the end of Q1, 2024, China’s NEV possession is expected to hit 22.1 million. If we assume each vehicle runs 20,000 km per year and consumes 8 liters of gasoline to run 100 km, then the gasoline consumption substituted by NEVs is predicted to be nearly 6.4 million mt.

Meanwhile, China’s LNG heavy-duty truck possession is estimated to exceed 680,000 as of the end of Q1, 2024. If we assume each truck runs 120,000 km per year and consumes 38 liters of diesel to run 100 km, then the diesel consumption substituted by LNG heavy-duty trucks is projected to be over 6.4 million mt. Accordingly, the proportion of the total gasoline and diesel consumption replaced by new energy is estimated to be about 13%.