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Chinese-made electric scooters and bikes get recharged at the 2004 Challenge Bibendum, a green vehicle rally for carmakers. The event was held in Shanghai last October. The recharging station was provided by EDF, France's electric utility company. Remember plug-in electric cars that were all the rage in the 1980s, but then carmakers pulled the plugs on their programs due to long charging times and short driving ranges. Well, China has served notice that it intends to resurrect the technology and it impressed automakers and U.S. officials with the advances already made. | ||
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| As part of its planned 20bn RMB - $3.5 billion - investment on alternative-fuel vehicles before 2012, the Chinese government is to offer rebates to buyers of green cars and buses in thirteen of its largest cities. The Chery Automobile Company is the largest domestic car producer in China and the S18 model is its first foray into the electric car market. The S18 is able to travel up to 90 miles on a single charge. It can be fully charged in four to six hours from a household socket. |
| China Gearing Up for EV Dominance | ||
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Chinese manufacturers BYD Auto, Chery and SAIC are busy assembling vehicles, and the infrastructure is being set up as well. American vehicle charging infrastructure company ECOtality today announced an agreement with China's Shenzhen Goch Investment to set up a sales and manufacturing operations in China. The investment firm will provide $15 million to establish manufacturing and distribution operations for EV charging systems. The company also gave $2 million in direct investment to support ECOtality’s domestic and international expansion, and institutional investors provided another $500,000 for this purpose. The municipal government of Shenzhen province is considering a $7,300 incentive for plug-in hybrid vehicles and is readying a charging infrastructure. The country's central government is also considering a national incentive of between $1,400 and $7,300, according toCajing.com. To meet this demand, Shanghai Automotive Industry Corporation (SAIC) plans to invest $1.8 billion into the development of all-electric and hybrid vehicles, including more than $300 million this year alone. Nissan is targeting the Chinese market for its EVs. China's infamously smoggy cities and expected explosive growth in vehicles driven by an emerging middle class are the incentive for the country to move quickly to electric vehicles. China is ramping up all type of electricity production to keep the vehicles charged, including nuclear, hydro, and huge expansion of coal plants, which will limit the environmental benefits of moving away from petroleum transportation fuels. John Gartner is the Editor in Chief of Matter Network and an Industry Analyst for Pike Research. |
| More on Electric Cars | |||||
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Electric cars are becoming big news and will quickly become much bigger. Both the US and China are spending billions on battery research and on electric car production, but China appears to be much more serious about it. The thinking here is that Western countries have been manufacturing automobiles for 100 years while China hasn't as much experience. They can make perfectly adequate vehicles, but that's far from Rolls-Royce, Porsche and Formula One. So they've decided that instead of competing with the West on old established technology they would just leapfrog directly to electric cars where the playing field is essentially level or where maybe they have a bit of an advantage. China already makes several hybrid cars, but several automakers are coming out with new fully-electric cars this fall, and there will be many more next year. |
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One of the more interesting parts of all this is that the US automakers set the stage for their own downfall here many years ago as a way to avoid union pressure and reduce their costs. They began on a big-time scale to subcontract much of their manufacturing to auto parts companies like Magna. They did this to the point where now Magna actually assembles entire cars, having made many of the components themselves, and this is true with other parts makers as well. A basic car is apparently a very simple thing to make - a frame with a body shell, and that is all very old technology within anyone's capability. All of the engineering goes into the components - the engine, transmission, supension, differential, axles, glass, seating, airconditioning, GPS and all the other parts and options. But the big North American automakers passed off all of that technology to the auto parts makers so they lost control of it, and now you can buy all the parts you need to assemble a car by yourself. This is already being done to some extent in China, where some large companies with extensive manufacturing and assembly experience are opening new factories to assemble autos from parts. It is also being done with motorcycles, for e.g. the URAL retro bike made in Russia from a home-manufactured frame and shell and Western off-the-shelf components. And while a gasoline-powered car has some 22,000 parts an electric car has comparatively few parts and most of those are simple off-the-shelf components, available from many manufacturers. An electric car is basically a body shell with an electric motor and a bank of batteries. Electric motors are old too, so the only important new technology is the batteries. |
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It now seems apparent that cars may become commoditised in the same way that computers did when IBM went to an open technology framework which permitted anyone and everyone to make their own components and to mix and match. That's how Dell succeeded - by just buying parts from whoever had the best prices and doing the assembly to order. The most serious problem was that until recently, battery technology wasn't good enough to operate cars but then the NiMH (nickle metal hydride) battery came along that changed everything - but not for long. Exxon got hold of the company that owned the patents for this battery technology, took it off the market and sold it to Chevron Oil. Chevron closed the company, ceased all battery production and refused to even discuss licensing the battery patents to anyone, so for 15 years electric cars were dead. Apparently there were many discussions between Exxon, Chevron and the major auto makers about electric cars and they decided collectively they didn't want them. GM had at the time been producing the EV-1, which people dearly loved, but then GM repossessed all those cars (which were only on lease), took them back to the factory and destroyed them all. People were so upset that they were chaining themselves to their cars to prevent the repossessions, but to no avail. And that was the end of the electric car in North America - and in Europe too, because there were no batteries. Several companies have been making electric cars using the Lithium ion batteries meant for laptop computers, but these are far more expensive than the NiMH kind, so the cars are very expensive. But now, with the forced push from the US government, Chevron has begun licensing their NiMH battery technology, and Li batteries and others have made great progress as well. And the Chinese government is investing huge sums of money (billions of US dollars) in battery research and development for the benefit of their domestic auto industry. The electric cars coming out here this fall will sell for as little as $10,000 to $15,000, with the very nice ones at only about $20,000. And the market will really take off here because the Chinese don't have a long history of love with gasoline engined cars so they won't care. And for this country with its huge population and rapidly-rising incomes, smog-free electric cars will be a blessing. And the Chinese are already accustomed to electric motorcyles - there are millions of them everywhere, and they are very pretty, reliable, dead quiet, smog-free and inexpensive. Mostly they sell for 1,500 to 2,000 RMB - about $300 or less, and even the very expensive ones are less than $500. |
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In the West, electric cars may take much longer to become popular because there is no history of this, and everyone is so accustomed to gasoline engines. That tradition won't die quickly, and I doubt the US automakers will want to kill all their current profitable lines to focus only on electric cars, so the market will be fed from overseas. Every automaker in China, and there are many large ones, are going full-speed toward fully-electric cars and the government is even beginning to subsidise purchases to push people away from gasoline engines. From what I've seen, in 10 years 80% of all cars here will be electric. The city of Shanghai has already bought electric buses to be used for many routes and has installed charging stations in convenient locations. And for the manufacture of electric cars, the battery technology is the most important thing. China already knows how to make attractive body shells and car frames, as well as the major static components, so good batteries will put them right up near the top in terms of a good car. And optional components like super suspension can be purchased from many suppliers here and abroad. This is actually exciting because the electric cars all seem to be quite pretty to look at, and they're generally fast - 0-100 kph in only 3 or 4 seconds - and that is damned fast. The trouble has always been the range, but already they have it up to 300 or 400 kms, and that's enough for city driving. Also, the battery makers and service stations are thinking of a 'battery exchange' program where you drive into a service station and they remove your batteries and insert newly-charged ones and off you go. |
