Wednesday, April 25, 2012

China & EVs: A closer look at the 'dream'

There’s a great piece this week from the Associated Press, highlighting how electric vehicles have failed to catch on in China, despite grand plans from the government and the efforts of automotive companies like BYD, which we visited in Shenzhen.

“China's Dream Of Electric Car Leadership Elusive”

"China's leaders are finding it's a lot tougher to create a world-beating electric car industry than they hoped. In 2009, they announced bold plans to cash in on demand for clean vehicles by making China a global power in electric car manufacturing. They pledged billions of dollars for research and called for annual sales of 500,000 cars by 2015.

Today, Beijing is scaling back its ambitions, chastened by technological hurdles and lack of buyer interest. Developers have yet to achieve breakthroughs and will be lucky to sell 2,000 cars this year, mostly taxis. The government has hedged its bets by broadening the industry's official goals to include cleaner gasoline engines."

This has occurred despite government plans calling for "paying buyers rebates of up to 60,000 yuan ($8,800) per car the following year in five cities including Shanghai."

The article also touches on issues of intellectual property and the conditions under which international vehicle manufacturers enter the Chinese marketplace. For example, the government "strained relations with the United States and other trading partners by rolling out rules limiting access to its auto market unless foreign developers shared technology to Chinese partner."

One manufacturer, Daimler, "said it formed its venture with BYD not due to official pressure but because it wanted to create a low-cost brand for China." However, "other manufacturers such as Nissan Motor Co., maker of the electric Leaf, and General Motors Co. have chosen to pay the higher taxes required to import electric and hybrid vehicles rather than disclose expensive know-how to Chinese partners that might become rivals."