China changes to EV market with 100 times growth December 16 15:15

The Chinese EV = electric car market, which has continued to grow rapidly, is now undergoing a change. Since last summer, monthly sales have continued to be lower than the previous year, and there are concerns about a year-on-year decline. What is happening in China, the huge EV market? (General reporter of China General Manager Yoshida Satoshi, Guangzhou branch reporter Takeo Baba)

Lexus EV announced-new EV one after another

The Guangzhou Motor Show held in November in Guangdong Province in southern China. Unlike motor shows in Beijing and Shanghai, where many next-generation concept cars will be exhibited, many models that are actually sold by each manufacturer will be exhibited. It's a show. EV was also the main character of the Guangzhou Motor Show.

The first thing that attracted attention was Toyota. The world's first EV model of the luxury brand “Lexus” was released. He says he has made the best use of the motor control technology he has cultivated in hybrid cars over the years.

“We expect the luxury car market to remain strong. China is the most active country for car electrification and is a good place to unveil the first Lexus EV.”

On the other hand, “Tesla” in the United States exhibited EV that started production at the factory in Shanghai. The Shanghai factory is Tesla's first overseas factory, and the local government also strongly supports it as a symbol of the opening of the Chinese automobile market. The “Shanghai-made” car with the “Special Tesla” logo is ready to focus on the Chinese market.

The local manufacturer has not lost. Guangzhou's “Kominato Motor” unveiled a new sedan aimed at launching in the spring of 2020.

The time to reach 100 km / h is 4.3 seconds. We sell high driving performance that you can run 650 km on a single charge. This manufacturer is only 5 years since its establishment. Up until now, the AI ​​equipped with a voice recognition function and equipped with an EV that can perform most operations such as car navigation with voice has attracted attention.

Transforming into 100 times growth EV market

China's EV market, where each company sharpens. But now something is happening. The Chinese government has positioned EVs and PHEVs as plug-in hybrid vehicles as pillars of growth industries and has provided subsidized subsidies for purchases. As a result, sales of EVs, which were over 12,000 in 2012, grew by a factor of 100, last year to over 1.25 million. That has changed since summer. If sales volume in July turned negative compared to the same month last year, it was almost halved to 45.6% in October. In November, the decline was more than 40%, and the possibility of falling year-on-year is increasing.

The reason is the reduction of subsidies. The Chinese government has provided subsidized subsidies to the EV industry, but in fact the scale has been reduced year by year. In addition to reducing the amount of payment, we have sought to raise performance by stricter standards such as excluding from subsidies if we can not travel a certain distance with a single charge. We understand that “subsidy pickles” do not bring up the industry, and encourage manufacturers to strengthen their constitution. Furthermore, in late June, the subsidies provided by the central government (country) and local governments were abolished in principle. In addition, we raised the performance standards and narrowed the forehead. The result has led to a significant decrease in sales since July.

Visiting Tomo Wave

This is why the industry has started. It is said that there are nearly 500 companies registered as EV and PHEV manufacturers in China. Of these, about 60 companies actually manufactured cars. In addition, 45 companies are producing less than 10,000 units. In some cases, the company entered for the purpose of subsidy, but withdrawn because it was not profitable.

In mid-November, I visited a car factory outside Tianjin, about 150 kilometers southeast of Beijing. It was built in 2016 by an automobile manufacturer headquartered in Beijing as an EV production line. The site area is over 30 hectares. According to local media, it has a production capacity of 450,000 units per year. However, despite the daytime on weekdays, the factory was not popular, and there were only a few guardmen at the station next to the main gate.

Around the back of the site, hundreds of completed cars were left open, and there were several cars with broken windows and punctured tires. When I talked to a man from the company who stayed at the factory, he said only a few words: "The factory stopped operating long ago and cannot respond to interviews."

According to the company website, the company started manufacturing and selling gasoline vehicles in 2000. In 2016, we entered the EV business, selling sedan and small models. However, these two models have been excluded from the subsidy in the second year of release. As a result, sales performance declined rapidly, making it impossible to maintain the business. Experts familiar with the Chinese automotive industry talk about this:

“The Chinese government plans to abolish EV subsidies by 2020. Furthermore, it is expected to tighten regulations, such as tightening EV manufacturing licenses, and try to eliminate weak manufacturers. And leading German manufacturers are entering the market in earnest, and in the future, local Chinese manufacturers will be forced to reorganize. ''

EV manufacturer promoting business diversification

Some manufacturers are promoting their own efforts in the face of fierce competition for survival. “BYD” is headquartered in Shenzhen, Guangdong (also called “Silicon Valley in China”). BYD is one of the leading EV manufacturers in China, such as an agreement to form a joint venture company for EV development with Toyota in 2020. The BYD is currently promoting “diversification of business”.

There were two things that surprised me when I visited the head office. The first is that most taxis and buses that run around the city are BYD EVs. Second, there is a monorail running at the head office factory. An experimental line with a total length of 4.4 km is laid to sew between the buildings and dormitories on the site.

The monorail uses the electric control and motor technology cultivated in EVs, investing 5 billion yuan (about 80 billion yen) in 5 years, and more than 1000 engineers worked on research and development. The construction cost can be reduced to 1/5 and the construction period to 1/3 compared to the subway, and the company aims to sell it to cities suffering from air pollution and traffic congestion. So far, more than 100 city officials have been visited and already introduced in Yinchuan, Ningxia Hui Autonomous Region. Going forward, we plan to strengthen overseas sales in Brazil and the Philippines.

In addition to this, we have also developed a type like a small bus that runs on tires in the air and operates for the movement of employees within the company. The ride was smooth, automatic driving technology was introduced, and the ticket gates also used face recognition technology. We were able to ask about the seriousness of making the urban transportation business a pillar of business alongside EVs.

“I want to run this monorail all over the world. From now on, I will be comprehensively involved in consigned production of batteries, solar power generation, LEDs and smartphones. The future is bright.”

BYD was originally founded as a battery manufacturer, and will continue to diversify its business by taking advantage of battery technology. Competition in the world's largest EV market, China, is intensifying due to the decline in automobile sales and subsidy reduction. Each company's own efforts to survive are likely to accelerate in the future.

Reporter of China
Satoshi Yoshida Covered finance and trade in the Ministry of Economic Affairs enrolled in 2000

Guangzhou branch reporter
Takeo Baba Joined in 2007 Akita and Nagoya stations, and then moved to Guangzhou from July