Electric car an idea that may have had its day

PUBLISHED : Friday, 11 November, 2011, 12:00am
UPDATED : Friday, 11 November, 2011, 12:00am


Beijing is having a serious rethink over its ambitious electric vehicles policy.

The central government has assembled the top experts and policymakers on electric and hybrid cars at a meeting in Wuzhen, in Zhejiang province, this week.

One expert attending the meeting said the government was increasingly concerned about problems in the industry, including its cost-effectiveness, technological difficulties and the uncertain benefits to the environment, according to the 21st Century Business Herald.

It said Beijing was reconsidering its support for pure electric cars and may rethink how to spend the 100 billion yuan (HK$122.6 billion) fund set up to develop green vehicles - perhaps by shifting resources to hybrid cars.

Beijing is soon to release the final version of its long-awaited green car development plan, which has been under drafting by the Ministry of Industry and Information Technology since 2009. But there is now growing debate as to how to make best use of funding set aside to help develop the next generation of cars.

The central government announced its ambitious plan to develop a new generation of green vehicles - focusing on pure electric cars - two years ago.

However, in July, Premier Wen Jiabao wrote a long article in the Communist Party's mouthpiece Qiushi magazine in which he said he was confused by the latest developments and the future of electric cars.

He also criticised the lack of co-ordination and planning of local authorities and warned against committing resources to premature technologies. 'Whether electric cars will be a mature product, we don't know,' he wrote.

Professor Zhou Dadi , vice-chairman of the National Energy Advisory Committee, told the South China Morning Post yesterday that the government should reduce or stop subsidising electric cars as the technology has not yet reached maturity. Since 2009, the mainland has operated an experimental subsidy scheme for electric cars in 13 cities, including Beijing, Shanghai, Guangzhou and Shenzhen, to gauge the market. But even by subsidising each electric car by 120,000 yuan, officials still found market reactions to be lukewarm and disappointing, Zhou said.

'Consumers show no willingness to buy electric cars, no matter how subsidised they are. Those who bought one complained of huge inconvenience, such as the short battery life and many other unsolved technological problems.

'It's not that government is being more thrifty, there are real problems in electric car technology,'

Fang Fang , who is general manager of the Innovation Centre for Energy and Transportation's China operation, said that after conducting a national study on the electric car's environmental impact, particularly its carbon footprint, his organisation had submitted a report to the government earlier this year advising major changes to the present scheme.

'We have provided the Chinese government with figures showing that electric cars' carbon dioxide emissions would exceed autos on fossil fuel in north China due to the region's heavy reliance on coal to generate electric power,' she said.

'In regions with rich natural gas resources, the promotion or subsidy for natural gas vehicles may yield more environmentally friendly results than electric cars.'

BYD, the biggest electric car manufacturer on the mainland, in which US billionaire Warren Buffett took a 10 per cent stake in 2008, released its all-electric MPV in Shenzhen this month. The official price of the vehicle is 360,000 yuan, with a 120,000 yuan subsidy evenly shared by the central and Shenzhen governments.

Shares of BYD fell more than 8.3 per cent yesterday to a two-week low after the company reported a 23.5 per cent fall in car sales in the first 10 months of 2011.


The amount by which Beijing has pledged to increase its fleet of electric taxis by next year. This will take the number from 50 to 150