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Electric cars may get jolt from Chinese market – The Globe and Mail

China is already the world’s largest car market. Now the likes of Tesla and parts maker Wanxiang Group are betting the same will soon be true of electric vehicles. Though infrastructure lags behind the West, dense cities and strong central planning should give Chinese sales a jolt.

Wanxiang Group recently won the battle to buy what’s left of bankrupt U.S. electric car maker Fisker. For an upfront investment of $149-million (U.S.), China’s largest car parts maker got a dormant American manufacturer of plug-in hybrid coupes which foundered over technical problems. Wanxiang had already bought Fisker’s battery provider at an earlier auction.

Gaining control of designs for Fisker’s high-end Karma cars provides a leg-up towards making electric cars in China, which is set to be the world’s largest market by sales in 2020, according to International Energy Agency data. Tesla is also bullish: it expects global sales to double in 2014, and that China will account for about 30 per cent of the total. That implies it will shift about 14,000 all-electric cars on the mainland, despite the price tag of 734,000 yuan ($132,000).

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Electric cars may get jolt from Chinese market

China is already the world’s largest car market. Now the likes of Tesla and parts maker Wanxiang Group are betting the same will soon be true of electric vehicles. Though infrastructure lags behind the West, dense cities and strong central planning should give Chinese sales a jolt.

Wanxiang Group recently won the battle to buy what’s left of bankrupt U.S. electric car maker Fisker. For an upfront investment of $149-million (U.S.), China’s largest car parts maker got a dormant American manufacturer of plug-in hybrid coupes which foundered over technical problems. Wanxiang had already bought Fisker’s battery provider at an earlier auction.

Gaining control of designs for Fisker’s high-end Karma cars provides a leg-up towards making electric cars in China, which is set to be the world’s largest market by sales in 2020, according to International Energy Agency data. Tesla is also bullish: it expects global sales to double in 2014, and that China will account for about 30 per cent of the total. That implies it will shift about 14,000 all-electric cars on the mainland, despite the price tag of 734,000 yuan ($132,000).

Unlike hybrids, which can run on petrol, all-electric cars depend on a network of charging stations. Tesla has built a network of fast-charging stations in the United States, but repeating the trick in China may be less straightforward. Domestic rivals like BYD have similar plans, and Beijing has been pushing for car makers to adopt a single standard for charging technology.

The absence of charging stations explains why Chinese bought only 18,000 plug-in electric vehicles in 2013, while American drivers bought roughly five times as many. Finding a way to efficiently recharge cars for apartment dwellers is also a challenge.

However, the Chinese government has greater powers to force a rapid build-out of a uniform charging network. If done right, electric cars could quickly catch on among the country’s dense urban population, especially given widespread concerns about pollution. Though China’s love affair with the car has not extended to electric vehicles so far, don’t bet on that lasting.

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