Chinese consumers not turned on by EVs

July 19, 2011
Chinese consumers are clearly petrol heads

Despite a number of policies and subsidies by the Chinese Government, sales of electric vehicles are failing to take off in most of the country's big cities where they are being pushed.

In June 2010, five cities, including Shanghai, Changchun and Shenzhen, began to subsidize the purchases of new energy vehicles on a trial basis. This number has since increased to 25.

On July 8, Changchun implemented 16 measures that are intended to promote private purchases of new energy vehicles. The city plans to offer 500 new energy cars to assigned customers, for whom a basic post-sale service system will be established.

However, most of these policies have so far failed to woo the private market. Several new energy car dealerships in Changchun have seen zero sales for electric cars, with some of them lacking even a proper display model for their stores.

"Sales of electric cars in other cities like Beijing, Shanghai and Hangzhou have been the same. Dealers in those cities also refrain from exhibiting the cars in their stores, as their sales have been pretty bad," said one car dealership spokseman in Changchun.

Sales of new energy vehicles have not been encouraging in the country's trial cities. In Shanghai, licenses for new energy cars are rarely issued. BYD, one of the country's leading car makers, has only sold a few hundred of the vehicles.

Consumers have largely held back due to concerns regarding the safety and ease of use of new energy vehicles.

In addition to previously encountered problems such as the short lifespan of electric batteries, other factors such as incomplete industry standards, poor management and safety risks have troubled the growth of the new energy vehicle sector, according to industry experts.

Due to a lack of relevant industry standards, electricity suppliers and automakers are still wrestling with questions over how the vehicles' batteries should be designed and operated.

Guo Konghui, an academic from the Chinese Academy of Engineering, said the development of new energy vehicles is still at an exploratory stage, even in developed countries.

"If the past five years can be viewed as a developing period for the sector, the next five years will be a time for the industry to crack down on key issues," Guo said.