Warren Buffett

Electric Cars Get A Jump Start in China

Anyone concerned about the planet's future and our ability to bring our climate-disrupting emissions under control, can't help but regularly steal nervous glances at China. What China, with its massive population and prodigious growth rate does or doesn't do, will have a significant impact on all of us. So when China said they wanted 500,000 "new energy vehicles” on the road by next year and five million by 2020, many of which would be driven by first time car buyers newly entering the middle class, that gave us reason to be hopeful. Many have been skeptical that such numbers could be achieved. Especially since last year, only 17,600 EVs were sold. Today, there are approximately 50,000 of them on the road.

But a number of recent developments could be turning up the heat.

First, Chinese EV-maker BYD, which is partially backed by Warren Buffett, has been selling most of their cars in their home city of Shenzhen. Earlier this week, they gained approval to begin selling in Beijing with its population of 11.5 million. Beijing officials will provide a subsidy for EVs and they also commit to installing 100 charging stations in the city by the end of the year with roughly ten charging units per station. This roughly coincides with Swiss electrical equipment-maker ABB's announcement that it would begin making and marketing wall-mounted home electric vehicle chargers in China. The chargers are being developed for Denza, a new joint venture between BYD and Daimler.

Says Chunyuan Gu, ABB's top man in China, "Either you believe or you don't believe. What's difficult to predict is how fast the volume will come."

BYD also received approval this week to sell its plug-in hybrid, the Qin, in Shanghai

China's fast growing car market is attracting the attention of automakers around the globe. Last year 22 million cars were sold there, compared with 15.6 million in the US. Major problems like air pollution and gridlock are leading local officials to tighten restrictions on new drivers' licenses, which will slow the pace of growth. Electric cars, which don't contribute to air pollution are getting a warmer reception.

Some people believe that were are approaching a point of “peak cars” altogether, but that is clearly still a ways off in China.

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