Policy switch accelerates race for China's electric car

A sketchy announcement in September that the Chinese government is working on a timetable to phase out production and sales of traditional energy vehicles has added fuel to the already fierce competition among electric-vehicle manufacturers worldwide.

Attending an automobile forum in Tianjin, Xin Guobin, China's vice-minister of industry and information technology, disclosed that the country had started research on a timetable to ban gas and diesel cars in order to combat its chronic emissions and pollution problems.

While unveiling no details on the timeframe, Xin said regulators have begun the relevant research, and "the measures would surely bring profound changes to the sector's development" as the policy will be implemented "in the near future".

Industry players and observers are taking this policy switch seriously. Why? China is the world's largest car market, accounting for around 30 percent of global passenger-vehicle sales. Its imminent ban on fossil fuel cars will affect the entire automobile ecosystem, from design and materials to power and technology.

The list of China-based electric vehicle (EV) makers has continued to grow and gain momentum in recent years.

A good example is electric bus-maker BYD, which has periodically made headlines by inking deals with local transportation agencies. The board of Los Angeles Metro, one of the largest transportation systems in the US, voted unanimously on July 27 to award a contract for five dozen 40-foot, all-electric BYD buses. It was one of the largest contracts for electric buses in US history, and will directly lead to 59 new jobs at the BYD factory in Lancaster, California.

In an August interview with China Daily, Atlanta-based Novelis, a leading producer of rolled aluminum and aluminum recycling, pledged that it will continue its partnership with China and expand investment in China's automotive industry, especially in the electric vehicle sector.

"The driving force behind our business strategy in China is the nation's increasingly strict policy against pollution," said Pierre Labat, Novelis' vice-president for global automotive.

Starting with a $100 million investment from scratch, Novelis' Changzhou plant now boasts an annual production capacity of 120,000 tons of heat-treated sheet aluminum and meets the rapidly growing demand from conventional and new generation automakers for rolled aluminum for use in lighter, more fuel-efficient vehicles.

"If we look at our total automotive sales in the world, China is currently about 10 percent - fairly small," said Labat. "But it's our fastest growing market and yields the highest-percentage of growth."

In March, Novelis expanded its portfolio of automotive customers into the EV sector by adding Shanghai-based electric vehicle startup NIO to its client pool, which already includes Ford, Audi and Jaguar. According to the agreement, NIO's electric SUV ES8 models will adopt Novelis' aluminum alloys to create a wide range of structural vehicle components and parts.

Many EV makers want to go after the premium EV market beyond China with high-quality products. Future Mobility Corp is an EV venture co-founded in 2016 by former BMW and Nissan Motor executives and headquartered in Nanjing. It has named its brand "Byton" and plans to launch in the US and EU soon after starting sales in China around 2019.

Chairman, CEO and co-founder of Future Mobility, Carsten Breitfeld, spoke to the media about the company's future launch of three models - an SUV, a sedan and a seven-seat multi-purpose vehicle - by 2022.

Recently raising $200 million from investors, including China's Suning and Fullshare Holdings, Future Mobility already has a premium midsize crossover sport utility vehicle ready to go into the next "serious" phase of development. The company has said the SUV will hit China in 2019.

"The car is really developed for China, the US and Europe," Daniel Kirchert, Future Mobility's president, told the media.

They plan to unveil the production-ready version of the first car at the Consumer Electronics Show in Las Vegas in January of next year.

The race is on.

Contact the writer at junechang@chinadailyusa.com.