Is This the Decade of the Chinese Electric Car?

With 2009 now in the rear view mirror, the global auto industry turns its attention to this year’s North American International Auto Show in Detroit, which opens next week. After a free fall in sales in the past year-and-a-half, car companies will do their best to present a hopeful image of better times in the new decade. Two of the biggest trends in the 2010s will be the rise of China’s auto industry and the emergence of plug-in cars—so expect the electric cars and plug-in hybrids from China’s BYD Auto to garner a lot of attention.
BYD will return to Detroit this year to show its e6 all-electric car and the F3DM plug-in hybrid sedan. According to BYD, the e6 can accelerate from zero to 60 in 8 seconds, has a top speed of 100 mph, and can travel a surprising 250 miles on a single charge. The F3DM can go about 60 miles using only batteries. After that, a 1.0-liter gasoline engine is used to extend the vehicle’s range.
Ironically, BYD displayed the same two vehicles last year—spawning the same excitement about greener plug-in cars, as well as the same fears that inexpensive Chinese cars are ready to take the automotive world by storm. Those hopes and fears failed to materialize.
BYD did hit its 2009 total sales target of 400,000 units for its full line of vehicles, and has raised that goal from 700,000 to 800,000 units for 2010. But about two-thirds of 2009 sales were from its conventional F3 model. On Dec. 30, BYD Auto announced plans to release five new car models—all gas-powered—in 2010.
According to gasgoo, a Chinese auto industry website, BYD’s current hot-selling compact models are priced below 100,000 yuan (US $14,500.) That’s considerably cheaper than the midsize F3DM plug-in hybrid, which sells for about $22,000 in China—and the five-seat electric e6, which is expected to sell for about $40,000. The media continues to report that these vehicles will go on sale in the US in 2010; yet, they have not yet been certified for sale, and face questions on quality, crashworthiness, and equipment. These delays are unlikely to deter BYD from its goal of dominating the global hybrid market by 2025.
A Push from the Chinese Government
The F3DM was celebrated as the world’s first mass-produced plug-in hybrid, but the high price of the vehicle—which officially went on sale a year ago in China—has kept BYD from offering the plug-in hybrid to private buyers. The company has sold only a few hundred units to fleet customers. BYD executives say they are ready to “re-launch” the car in the coming weeks. But why would the company succeed this year when it failed last year?
Here’s why, maybe. Recognizing that these advanced electric-powered vehicles are too expensive for ordinary Chinese consumers, the Chinese government last month announced new incentives to help private consumers buy green cars. The incentives were announced on China’s main government website, but few details were offered. The purchase rebates are limited to buyers in five cities, but the locations have not yet been identified.
On the other hand, incentives for plug-in hybrids and electric cars are in place for US customers—with buyers of vehicles like the Chevy Volt and Nissan Leaf set to receive a $7,500 tax credit. US consumers will have to wait until the last few days of 2010 for a chance to buy one of those cars. Meanwhile, the 2010 Detroit auto show will tease potential EV buyers with a 37,000-square-foot exhibit devoted to electric vehicles. The exhibit, called Electric Avenue, will be on the main floor of Detroit’s Cobo Center. The display will have about 20 vehicles from both conventional automakers and start-up companies.
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