By Bill Smith -
TECHNOLOGICAL and pricing issues have slowed China’s drive to mass-produce affordable electric cars, but analysts and insiders believe partnerships with foreign firms could help it to reach its long-term goal.
CH Auto, a small producer in Beijing, is promoting its Cylent two-seater “city commuter car,” which uses lithium-ion (li-on) battery technology.
The company is among dozens of Chinese, foreign and joint-venture firms showing futuristic electric models alongside hybrids and fuel-efficient conventional vehicles at Auto China 2012, which opens to the public in Beijing today.
Last week, the government issued its revised plan to develop annual capacity for 500,000 electric vehicles by 2015 and about 5 million by 2020 as the “strategic orientation” for China’s market.
The plan prioritises industrialisation of pure electric and plug-in hybrid vehicles, as well as fuel-efficient conventional vehicles. It commits the government to subsidising energy-saving vehicles and accelerating construction of charging stations for electric vehicles.
Local governments in at least 10 major cities are supporting plans to develop electric vehicles by regional car makers, many of which are state-controlled or have state enterprises as major shareholders. But some analysts worry that practical problems will delay the programme and make the government miss its targets.
Even heavy subsidies will not attract enough Chinese consumers, who can buy a petrol-driven compact car for less than half the cost of an electric vehicle, the pessimists say. “I think the development of electric cars is slower than expected,” Cui Dongshui of the China Passenger Car Association said.
“There are many problems,” Cui said, pointing to poor marketing and a mismatch between research and production of electric vehicles.
“All those years of scientific research projects are displayed on the exhibition stands but they haven’t been accepted by ordinary people,” he said.
Companies also worry that government subsidies for electric vehicles are too low and will only be offered for a few years, said Jia Xinguang, chief analyst for the China Automobile Consulting Corporation.
CH Auto’s Cylent name reflects another problem: the safety of speeding electric cars looming behind pedestrians and cyclists with no aural warning.
Quality issues also raise doubts about the heavy packs of multiple li-on batteries, which are likely to fail if just one of the cells is substandard.
“Immature battery technology, underdeveloped supply chains and lack of infrastructure standards are just a few of the barriers that have prevented China’s EV (electric vehicle) industry from taking off,” US consulting firm McKinsey said in a report last week.
“Our research shows that plug-in hybrid-electric vehicles could provide the right bridge in the short- to medium-term on the road to a future dominated by battery-electric vehicles,” the report said.
Cui agreed that the government should allow a more “natural” transition to electric vehicles, but he said that even hybrids were difficult to market in China.