An Electric Car From China
While China has many automakers who produce small, electric cars, most of them are relatively low-quality and low-speed vehicles that don’t appeal to a broad market. The Wuling, an electric vehicle, is associated with a Latvian automaker who could sell it in Europe. Despite this connection, the price of the Wuling is unlikely to be affordable in Europe because of environmental standards. It is, however, a promising start for an electric car from China.
The first Chinese EVs were sold in 2007, and sales of new energy vehicles jumped 107.9% in the first half of 2008. The number of EVs sold each year more than offsets the reduction in per-vehicle costs, but the incremental cost to society is growing as the EV market grows. It is estimated that the transition to EVs forced by a government mandate will cost 100 billion yuan per year by 2030, which amounts to about two percent of the nation’s transport spending.
The Chinese automakers are committed to reducing their environmental footprint and are making a conscious effort to improve their cars’ fuel economy. They have set goals to achieve these goals by lowering fuel costs and making the cars more attractive to potential buyers. Despite this, it is possible that the cost of an EV can be much higher than it is today. It can be as high as a $50,000 car if the manufacturers don’t make it available for sale in the US and European markets.
While these goals are good for the environment, the declining fuel prices are a huge challenge for electric vehicles. However, the government has not pushed major global automakers into building additional electric vehicle production capacity in China. The list of Chinese independent carmakers that are making EVs includes Xiaopeng Motors, Dongfeng, and Sichuan Mustang Automobile Co. There are several other smaller brands in China producing electric cars, but none of them have yet made it to market.
While China has the largest market for electric cars in the world, it isn’t as developed as the US. In the US, the government exported jazz music, blues, and technicolour movies, among others. The American dream of owning a personal electric car was heavily marketed and has become a cultural icon. But China lacks the cultural attraction and political acceptance of its EVs in overseas markets. It’s not just the economics that are limiting its EV production.
While the Chinese government has not disclosed the exact details of the Spectre, the company has stated that it plans to use the luxury all-aluminum alloy platform of its Luxury. The Spectre is expected to be the first electric vehicle in China to feature a sci-fi design, and is one of the few mid-range electric cars from a Chinese independent brand. A few other notable examples of electric cars produced in China include the Horki, a joint venture between Dongfeng and Yueda companies, and Sichuan Mustang Automobile Co, both owned by the Fulin Group.
In China, the EV is already becoming a global phenomenon. In the first half of 2008, more than 366 thousand EVs were sold, an increase of 107.9% year-on-year. The Chinese government is also working towards the goal of carbon neutrality by 2030, when half of all new cars sold will be electric. This will have an important impact on China’s environment, especially given the high rate of automobile ownership and its high-energy consumption.
In addition to its success in China, EVs are being produced in many other countries as well. It is expected to be the largest market for electric cars in the world by 2040. By this date, about 300 million NEVs will be on the streets of China. Considering that the Chinese automakers are already putting so much effort into the development of the EV, the government may not be as eager as some of its competitors.
China’s EVs aren’t yet ready to compete in the global market. To be able to dominate the EV market, it would need to reach established markets with sophisticated consumer expectations and a large number of existing EV manufacturers. In the meantime, the EV market in India could help China’s EVs survive in a country where its political status is still highly regulated. The emergence of a few Chinese EV manufacturers is an indication of the future prospects of the country’s automobile industry.