If you want to understand how governments can fuel the rise of new technologies, look no further than Beijing’s taxi fleet.
Five years ago, the city revealed plans to ban the introduction of fossil fuel-powered taxis. Today, thousands of cars run on batteries. And drivers of these electric vehicles (EVs) don’t even have to worry about wasting time at charging stations.
Many electric taxis in Beijing and dozens of cities across China simply go to a battery-swapping station, where a machine removes a dead battery and installs a charged one in just a few minutes.
“They want to make some money by driving there so they certainly don’t want to wait two hours for EV charging,” explains I-Yun Lisa Hsieh from National Taiwan University.
This is just one aspect of the increasingly diverse and fast-growing market for electric cars in China. Members of the public are also snapping up EVs in unusual numbers.
In July, the China Passenger Car Association predicted that 6 million new EVs would be registered in the country in 2022 — a revision to its previous forecast of 5.5 million EVs sold that year.
Tesla had its best month ever in China in September, with 83,135 cars sold, according to its latest figures.
About a quarter of all newly registered cars in China are now electric or plug-in hybrid vehicles, meaning the country is ahead of Europe and well ahead of the US in adopting these technologies. Half of the world’s EVs are sold in China.
And this is largely driven by government mandates and incentives, says Mr Hsieh. For more than a decade, the Chinese government has subsidized the purchase of EVs. These subsidies have declined in value over time, and are set to expire in 2023, but there are still plenty of reasons why buying an electric car is a financial no-brainer.
Many buyers of new fossil fuel vehicles in China have to pay not only for the vehicle but also for the license plate. “It’s really expensive,” says Mr. Hsieh. A new license plate in Shanghai costs about 100,000 yuan (£12,500; $14,000).
There are other benefits if you opt for an EV instead, though they vary from city to city. In Liuzhou, authorities have allowed EV owners to drive in the bus lane. And they also have access to free parking spaces.
Then there is the potentially irresistible price of some vehicles. The Wuling Hong Guang Mini EV bucks the trend of EVs being a relatively expensive option.
Jon Hykawy, president and director of Stormcrow Capital, a consulting and research firm, says the entry-level version of this dinky, no-frills car costs just £4,200 and will appeal to city dwellers and first-time car owners. does.
“These are vehicles that can be sold in a large part of Asia as well,” he adds.
The Hongguang Mini is currently the most popular EV in China. But there are plenty of options at the other end of the price scale, such as Tesla’s Model Y (£49,000) or Xpeng’s P7 (£30,410). Both are among the top 10 best-selling EVs in China.
The Chinese EV market is very competitive and many companies are vying for a place in it. According to a recent report, even an airline, Juneyao, wants to start making electric cars.
“It’s a very good environment for these manufacturers to develop the technology,” says Gartner analyst Pedro Pacheco, noting that some of the battery EV offerings in China are particularly good.
And manufacturers are stuffing high-end EVs with infotainment systems and other gadgets in a further effort to woo customers.
