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Going green, car hub clutches trend
By Vivian Jin |
April 23, 2012, Monday
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Print Edition
Print Edition
JIADING District in Shanghai's northwest has evolved into a major automotive manufacturing center in China and now has its sights set on becoming a research and production hub in the new era of environmentally friendly vehicles.
Jiading boasts a long history of carmaking, dating back to the first Shanghai brand car to roll off the assembly line in 1958. The 68-square-kilometer "auto city" is home to Volkswagen's flagship joint venture with SAIC Motor Co as well as more than 200 automotive parts suppliers.
"We are in full swing promoting new energy vehicles to meet the growing challenges of environmental protection and energy saving," said Fei Xiaomei, deputy governor and member of the Standing Committee of Jiading District.
The government push has attracted automakers including Chery, which has set up an engineering center and manufacturing facility in Jiading, with the goal of turning out 50,000 electric cars a year.
The district has also developed a cluster of 26 research and development sites related to the new energy industry and set up testing facilities that include the Shanghai Ground Vehicle Automobile Wind Tunnel Center and the National Lab of New Energy Vehicle and Power System.
Last year, Jiading was selected by the central government as the site for China's first electric vehicle international demonstration zone.
"The purpose for setting up the zone is to pick up the pace on the commercialization of electric vehicles and also boost awareness among consumers," said Fei. "Chinese consumers have limited knowledge about green cars, and we need to guide more people into the new segment of the car industry."
China has placed a high priority on development of new energy vehicles in the country's 12th Five-Year Plan (2011-2015) with financial and technological support, prompting carmakers to believe that China has the potential to becoming the world's largest market for environmentally friendly cars.
Jiading's target is to have 10,000 new energy vehicles running on the streets by 2015 including plug-in hybrids and electric cars. The district also constructed 91 charging poles already with plans to lift the number to 700 this year in addition to two charging stations, said Fei.
The test drive center in Jiading now boasts a fleet of 20 electric vehicles from 10 companies, including domestic carmakers Chery, BYD and SAIC, and international auto brands Volvo, General Motors and California-based Coda.
About 26,000 people have come to the test drive center to get behind the steering wheel and try out the new vehicles since the facility opened a year ago.
Slow process
Electric cars provide zero carbon emissions and lower driving costs amid record high fuel prices. The Chery M1, for example, has a maximum range of 165 kilometers at a top speed of 120 kilometers an hour. It can be recharged overnight.
Jiading's lofty ambitions for sales of electric vehicles depends, in large part, on weaning the public off the internal combustion engine and convincing car buyers that green cars are safe, efficient, dependable and easily recharged. That process is proving slow.
A majority of electric vehicles running on the streets of Jiading are buses and garbage trucks purchased by the government, according to Fei.
A year ago, the first batch of eight electric vehicles purchased by private buyers hit the road. The number, including leasing, grew to around 25 units by now.
Su Yihui, vice curator of Shanghai Auto Museum and head of the test drive center, said, "The current priority is to achieve sales of 100 units this year, particular among private consumers."
Su said the electric car market is still in its infancy where mass popularity is concerned. High prices, limited driving range and the lack of adequate recharging facilities are inhibiting factors.
The Chery A1 electric car costs about 60,000 yuan (US$9,524) to 80,000 yuan, after national subsidies and city financial incentives. The imported Chevrolet Volt sells for more than 490,000 yuan in China, more expensive than a luxury BMW 5-Series sedan.
As prices for internal combustion engine cars drop amid fierce competition, the sales pitch for green cars becomes more difficult.
China offers a subsidy of up to 60,000 yuan on the purchase of an electric vehicle. The municipal government in Shanghai also has agreed, in principle, to offer up to 40,000 yuan for each electric vehicle purchased, but details of that plan have yet to be announced.
A deputy director at the Jiading joint venture of German car parts maker Continental said it's a tough slog to convince the public to go green.
"The electric vehicle business has been a hot topic in the industry, but you will still have difficulty finding charging facilities," he said. "I just didn't see a sizeable economic scale right now."
But Su said, in the long term, the market potential for electric cars is promising.
"The electric vehicle is a suitable solution for daily driving because of its cost advantages amid rapidly rising gasoline prices," he explained.
The Jiading government said it is hoping that deeper support for technological research in the industry will help speed up commercialization of the vehicles.
According to Fei, the Jiading government will invest 5 billion yuan in the automotive sector, helping companies strengthen their research and development capabilities. About 300 funds have also invested in Jiading, with some focusing on the development of new energy vehicles.
Jiading has sweetened its position by offering favorable policies, including a special housing fund, to attract more automotive industry professionals.
"The electric vehicle market will accelerate its development as long as there is combined efforts of technology breakthrough, government support and growing consumer acceptance," Fei said.
Jiading boasts a long history of carmaking, dating back to the first Shanghai brand car to roll off the assembly line in 1958. The 68-square-kilometer "auto city" is home to Volkswagen's flagship joint venture with SAIC Motor Co as well as more than 200 automotive parts suppliers.
"We are in full swing promoting new energy vehicles to meet the growing challenges of environmental protection and energy saving," said Fei Xiaomei, deputy governor and member of the Standing Committee of Jiading District.
The government push has attracted automakers including Chery, which has set up an engineering center and manufacturing facility in Jiading, with the goal of turning out 50,000 electric cars a year.
The district has also developed a cluster of 26 research and development sites related to the new energy industry and set up testing facilities that include the Shanghai Ground Vehicle Automobile Wind Tunnel Center and the National Lab of New Energy Vehicle and Power System.
Last year, Jiading was selected by the central government as the site for China's first electric vehicle international demonstration zone.
"The purpose for setting up the zone is to pick up the pace on the commercialization of electric vehicles and also boost awareness among consumers," said Fei. "Chinese consumers have limited knowledge about green cars, and we need to guide more people into the new segment of the car industry."
China has placed a high priority on development of new energy vehicles in the country's 12th Five-Year Plan (2011-2015) with financial and technological support, prompting carmakers to believe that China has the potential to becoming the world's largest market for environmentally friendly cars.
Jiading's target is to have 10,000 new energy vehicles running on the streets by 2015 including plug-in hybrids and electric cars. The district also constructed 91 charging poles already with plans to lift the number to 700 this year in addition to two charging stations, said Fei.
The test drive center in Jiading now boasts a fleet of 20 electric vehicles from 10 companies, including domestic carmakers Chery, BYD and SAIC, and international auto brands Volvo, General Motors and California-based Coda.
About 26,000 people have come to the test drive center to get behind the steering wheel and try out the new vehicles since the facility opened a year ago.
Slow process
Electric cars provide zero carbon emissions and lower driving costs amid record high fuel prices. The Chery M1, for example, has a maximum range of 165 kilometers at a top speed of 120 kilometers an hour. It can be recharged overnight.
Jiading's lofty ambitions for sales of electric vehicles depends, in large part, on weaning the public off the internal combustion engine and convincing car buyers that green cars are safe, efficient, dependable and easily recharged. That process is proving slow.
A majority of electric vehicles running on the streets of Jiading are buses and garbage trucks purchased by the government, according to Fei.
A year ago, the first batch of eight electric vehicles purchased by private buyers hit the road. The number, including leasing, grew to around 25 units by now.
Su Yihui, vice curator of Shanghai Auto Museum and head of the test drive center, said, "The current priority is to achieve sales of 100 units this year, particular among private consumers."
Su said the electric car market is still in its infancy where mass popularity is concerned. High prices, limited driving range and the lack of adequate recharging facilities are inhibiting factors.
The Chery A1 electric car costs about 60,000 yuan (US$9,524) to 80,000 yuan, after national subsidies and city financial incentives. The imported Chevrolet Volt sells for more than 490,000 yuan in China, more expensive than a luxury BMW 5-Series sedan.
As prices for internal combustion engine cars drop amid fierce competition, the sales pitch for green cars becomes more difficult.
China offers a subsidy of up to 60,000 yuan on the purchase of an electric vehicle. The municipal government in Shanghai also has agreed, in principle, to offer up to 40,000 yuan for each electric vehicle purchased, but details of that plan have yet to be announced.
A deputy director at the Jiading joint venture of German car parts maker Continental said it's a tough slog to convince the public to go green.
"The electric vehicle business has been a hot topic in the industry, but you will still have difficulty finding charging facilities," he said. "I just didn't see a sizeable economic scale right now."
But Su said, in the long term, the market potential for electric cars is promising.
"The electric vehicle is a suitable solution for daily driving because of its cost advantages amid rapidly rising gasoline prices," he explained.
The Jiading government said it is hoping that deeper support for technological research in the industry will help speed up commercialization of the vehicles.
According to Fei, the Jiading government will invest 5 billion yuan in the automotive sector, helping companies strengthen their research and development capabilities. About 300 funds have also invested in Jiading, with some focusing on the development of new energy vehicles.
Jiading has sweetened its position by offering favorable policies, including a special housing fund, to attract more automotive industry professionals.
"The electric vehicle market will accelerate its development as long as there is combined efforts of technology breakthrough, government support and growing consumer acceptance," Fei said.
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