China charged up for electric car revolution to lighten footprint

An electric taxi project in China is setting green hopes alight as it proves to be a big, and popular, success.

A BYD E6 electric car, used as a taxi in Shenzhen, is seen on a road in the southern Chinese city of Shenzhen May 24,2010. The BYD E6 electric cars are China's first indigenous electric taxis, and BeiShow more

A pioneering electric taxi project in China's southern economic powerhouse of Shenzhen seems a success by most accounts. Passengers are enthusiastic, there have been no accidents and drivers are termed "gracious", not a term usually applied to mainland motorists.

The pilot project, which could be replicated in other cities, underpins China's ambitious plans to put at least 500,000 electric vehicles and plug-in hybrids on the road by 2015.

China is already the world's biggest emitter of greenhouse gases from burning fossil fuels and other activities that scientists say are causing global warming.

As the world's largest and fastest-growing car market, China's carbon footprint can only grow.

To bolster China's energy security, Beijing has pronounced the electric vehicle industry a top priority, earmarking US$1.5 billion (Dh5.5bn) annually for the next 10 years in the hope it can transform the country into one of the leading producers of clean vehicles.

But even with government support and the popular support of e-taxi customers, challenges remain for electric vehicles to gain broader acceptance and widespread use.

Charging stations are few and far between, repair shops are hard to find and the cars are costly. Even after generous government support, the Shenzhen e-taxi costs 80 per cent more than the Volkswagen Santana that cruises the streets of Shenzhen.

"The electric car is still too expensive and we ended up paying a lot more than for a Santana, even with government subsidies," said Du Jun, the general manager of Pengcheng E-taxi, the operator participating in the pilot project.

Local car makers, from SAIC Motor to Dongfeng Motor Group, have pledged large investments in greener vehicles. Their global counterparts, including BMW and Nissan, are also working with local governments to roll out their E-Mini and Leaf respectively.

The country's investment in the electric vehicle industry has no comparable programme in the US, although Congress is considering a bill that would allocate $2.9bn for a programme to help develop the infrastructure for the widespread use of electric cars.

Germany's cabinet agreed on plans in May to boost the country's electric car sector with billions of euros in subsidies, aiming to have 1 million of the cars on the road by 2020. Berlin's move will double state support for research and development to €2bn (Dh10.59bn) through to 2013.

For China to hit its targets for electric vehicles, however, will mean quickly winning market acceptance for an untested technology.

"I think it's going to be a very, very long time because the Chinese consumer … is very pragmatic and wants a reliable car with a gasoline engine," said Michael Dunne, the president of the industry consultancy Dunne & Company in Hong Kong.

"They don't want to be the ones experimenting. You're going to see government fleets buying, buses buying, not a mass movement towards electrics, definitely within the five years." In 2009, the Chinese government picked Shenzhen, along with 12 other cities, to lead the migration to green vehicles. Shenzhen and Hangzhou are the only ones attempting to launch e-taxi fleets.

Pengcheng E-Taxi, which is state-controlled and partly owned by BYD, a major domestic maker of green vehicles, was incorporated in March last year. Fifty e6 cabs, made by the Warren Buffett-backed car maker, hit the roads in the city three months later.

"People are really interested in the car," said Zeng Xiweng, one of the company's top drivers. "Over 90 per cent of customers start asking questions once they get in. All my colleagues have similar experiences as well."

Shenzhen resident Daniel Li recently took a ride in an electric taxi, one of the red cars with a wavy white band around the body that have been operating around the southern Chinese city for more than a year.

"I like the car. It's big and sturdy, pretty much like an SUV but not as noisy. It also saves me the 3 yuan [Dh1.70] fuel surcharge," the 32-year old software engineer said as he got out of the taxi. "The problem is there aren't many out there."

BYD is using the pilot project to gather market feedback and make adjustments before rolling out the electric car nationwide.

"We had anticipated a lot of problems early on, but that did not happen and the data we've collected are actually better than what we got in lab tests," said Stella Li, a senior vice president of BYD.

* Reuters