Electric car owners to get charging subsidies
Jun-27-2013 By : agxadmin
Shanghai’s Jiading District plans to provide subsidies for electric car charging for private buyers already subsidized by the municipal government. Until 2014, a total of 350 green car owners living or working in the district will each receive a subsidy of CNY15,000 for their electricity fees and expenses for charging. They already receive incentives of CNY40,000 to buy purely electric vehicles and CNY30,000 for plug-in hybrids offered by the city government. In order to get the subsidies, electric car owners need to plug their cars into a system that collects data on green car usage which will be used to study user habits. The latest data compiled by the district showed up to 80% of electric car owners drive under 60 kilometers a day, within the car’s maximum mileage on a single charge. By the end of March, there were 39,800 electric cars running on roads in China, a significant rise from 27,400 units last year, following continued efforts to make the cars more reliable and affordable. Over the past three years, the capacity of vehicle batteries and the lifespan of electric cars have doubled at the global level while their prices plunged 50%, Wan Gang, China’s Minister of Technology said at the 2013 International Forum on Electric Vehicle Pilot Cities and Industrial Development held on May 30. Wan said a new policy offering the same amount of central-level subsidies for electric cars will be implemented soon, the Shanghai Daily reports.
China is to shift the direction of its financial backing of the new-energy vehicle sector, by supporting research and development efforts, rather than simply offering consumer discounts on vehicle purchases, Minister Wan Gang said. Direct government incentives for consumers are likely to be phased out by 2020, if operational expenses can be lowered and the market expanded. “The government is unwaveringly committed to the industry, but EV makers should never count on subsidies to survive,” Wan said. “It is imperative for companies to enhance their core competence with research and innovation,” he added. China holds just 1% of total patent registrations for lithium-ion batteries, a critical component of EVs, while Japan owns 52% and the U.S. 22%. The Shanghai New Energy Vehicle Data Collection and Monitoring Center was set up in May, capable of the real-time monitoring of 2,000 electric vehicles in the city during the first phase of the CNY5 million project. The center will record vehicle mileage, battery use, performance of recharging stations and other systems-management information.
Traffic congestion could affect car sales
By : agxadmin
China’s automobile sales could slow considerably within the next two years, choked mainly by the inability of roads and highways to cope with the growing volume of traffic, particularly in the major cities, according to Hou Yankun, Director of China Equity Research and head of Asia Autos at UBS Securities. He predicted that 2013 will witness the “last wave” of sales surges in China’s auto industry. He estimated total sales to grow by 8.4% year-on-year in 2013, with sales of passenger vehicles up by 8.1% from 2012. Bottlenecks in infrastructure development are likely to lead to more vehicle purchase restrictions in the near future. China’s auto sales increased at compound annual growth rates above 20% between 2005 and 2010, but that level has already dropped significantly since 2011, mainly as a result of a slowing economy and the phasing out of stimulus policies. Many analysts still hold the view that the Chinese market is promising due to its low penetration rate, which is around 8%, compared with 50% in developed economies. In theory, if car affordability continues to follow the examples of Japan and South Korea, sales could maintain rapid growth for at least 10 years in China. But Hou said the ability of the country’s roads to cope with that level of growth is already being stretched.
Data show that there are about 550 cars for every kilometer in Beijing, compared to 300 even in congested Hong Kong. The average annual mileage of cars in the mainland is five times that of Hong Kong, added Hou. “It will be a challenge for the government to raise the speed of road construction, to keep pace with the acceleration of auto ownership,” he said. Mega-cities including Beijing and Guangzhou have already introduced car-purchasing restrictions, and people in Shanghai have to enter an auction for car license plates because of massive demand. Statistics show cities such as Fuzhou, Tianjin, and Nanjing are all suffering from low average driving speeds caused by chronic traffic congestion, which may force the local governments to consider purchasing restrictions. China’s auto industry is also facing an oversupply of vehicles. Several of the country’s major automakers have raised their capacity targets over the next few years, which could push vehicle production past government projections, listed as 37 million units in the 12th Five Year Plan (2011-15), to as much as 40 million by 2015. KPMG warned in a report that vehicle “manufacturing overcapacity is apparent”, the China Daily reports.
Toyota to make batteries in China for petrol-electric hybrid cars
By : agxadmin
Toyota Motor is to set up a joint venture with a local firm to produce batteries for the petrol-electric hybrid car market. Toyota Spokesman Takanori Yokoi said the Japanese carmaker is in discussions with Hunan Corun New Energy of Hunan province to jointly produce nickel metal hydride batteries for hybrid models Toyota plans to start selling in 2015. Toyota previously said it was working to design key hybrid components in China to make hybrid models more affordable. The move comes as Toyota and other carmakers gear up to try to kick-start sales of hybrid cars in anticipation of changes in the country’s policy aimed at nurturing demand for “new energy” cars to include conventional hybrids. Under the existing policy, Beijing provides generous subsidies for private purchases of all-electric battery vehicles and heavily electrified “near all-electric” plug-in hybrids, but only limited support for conventional petrol-electric hybrids. A number of industry insiders and experts believe the government will boost purchase subsidies significantly for conventional hybrids as early as this year. Yokoi said Toyota – which has bet big on petrol-electric hybrid technology since the late 1990s, when it began selling the Prius hybrid – plans to launch two relatively affordable hybrid models. One model will be marketed by Toyota’s joint venture with Guangzhou Automobile, while the other would be for its joint venture with FAW.
Guangzhou Auto focuses on own brand
By : agxadmin
Guangzhou Automobile Group is stepping up the development of its own brand as over-reliance on its Japanese partners for growth has proven dangerous, especially last year, when Japanese cars lost their attraction to Chinese consumers due to the Diaoyu islands dispute. After sales doubled for the group’s domestic brand, Trumpchi, in the first quarter, the state-owned carmaker said it would inject CNY2.85 billion over the next few years to double plant capacity. It would also introduce a new model every year, including a hybrid crossover that might hit the market later this year. The new hybrid car is the group’s first charge into the new-energy vehicle sector. Although its fuel efficiency is about 10% lower than that of Toyota’s Camry hybrid, the Trumpchi hybrid will save up to 70% of the fuel required by its petrol-driven rivals. Guangzhou Auto’s executives hope its retail price will be much more competitive than the model from Toyota, which has yet to localize production of its hybrid line. While Guangzhou Auto has already sold about 100 of the hybrid cars to government departments and kept another 100 for internal use, the firm’s engineers said the model still could not be priced competitively enough for retail sale. While the government offers subsidies of up to CNY120,000 for electric cars and CNY100,000 for plug-in hybrids, a buyer of a conventional hybrid car gets only a CNY3,000 subsidy – a fraction of the price of the Camry Hybrid, which costs CNY259,000 excluding tax. New incentives could bring the prices of hybrid cars below CNY200,000. Guangzhou Auto’s net profit plunged 73.5% last year to CNY1.13 billion, but sales rebounded 19% to 269,799 units in the first quarter of this year. Executive Director Lu Sa expects sales to rise 26% to 950,000 units this year. Although the Trumpchi brand remains a minor contributor to group revenue, sales of its models – including the popular GS5 SUV and GA5 car – more than doubled in the first quarter. The group is set to launch the GA3, a new compact car based on the Alfa Romeo 166 platform, next month. Guangzhou Auto will double the capacity of the Trumpchi plant to 200,000 units next year, although part of the new capacity would be leased to a U.S. carmaker, the South China Morning Post reports.
Toyota’s sales recovering
By : agxadmin
Toyota posted a sales turnaround, but may miss its target of selling 900,000 units this year in China. China sales edged up 0.3% year-on-year to 79,000 units in May. As one of the car makers most affected by China’s anti-Japanese boycott over the Diaoyu islands dispute, the increase marked the first time the sales rose since January when they surged 23.5% from a year earlier. Toyota then suffered a relapse in the following three months and its sales fell 11% in the January-April period. This doesn’t bode well for its target of selling 900,000 units in China this year, which represents a 7.1% increase. The company plans to roll out new models in autumn, including the revamped Yaris and Vios, counting on them to gain back lost ground in China’s entry-level car market. Its Japanese rival Mazda, whose sales fell 11.6% last month, also pins its hopes on new product releases to woo back Chinese drivers. From this month it will start localization of the CX-5, CX-7 and Atenza models.
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