(Repeats article first published late Tuesday. No changes to
* VW, GM, Ford plan raft of green energy cars
* China govt considers delaying green car quotas
* Cheap low-range Chinese brand EVs dominate local market
* Toyota re-thinks early electric car scepticism
By Jake Spring and Norihiko Shirouzu
SHANGHAI, April 18 China's auto industry is
charging ahead with aggressive plans to electrify cars even as
policymakers scale back subsidies aimed at building sales from
relatively low levels and consider tapping the brakes on sales
quotas for plug-in cars.
Industry executives will use the Shanghai Motor Show, which
opens to the public on Friday, to show off numerous battery
electric and plug-in hybrid models. But behind the scenes, many
are worried that batteries capable of delivering the same
driving range as gasoline cars are still too expensive.
While green energy car sales have risen dramatically on the
back of government policies, making China the world's leading
market in this segment, electric cars have otherwise generated
little consumer interest. They make up less than 2 percent of
China's overall auto market of 28 million vehicles sold last
The dominant players in China's electric vehicle market are
local, including state-owned Beijing Automotive Group, and
Warren Buffett-backed BYD. Most cars are
relatively cheap with limited range.
Beijing's central government has floated proposals to
require automakers to substantially boost sales of so-called
"new energy vehicles" (NEVs), or risk being penalized. But at
the same time, it is cutting subsidies on green cars by a fifth
this year, a move that could deepen manufacturers' losses on
such models and discourage consumers from buying them.
Policymakers say reducing subsidies gradually to 2020 will
wean automakers off government support and create a
self-sustained market for electric vehicles. Industry officials
and experts reckon tightening fuel efficiency regulations
through 2020 will compel car makers to rely more on
electrification to boost average fuel efficiency despite the
drop-off in subsidies.
Industry executives say long term, they expect China will
insist on more electric vehicles, and to be ready, they must
invest in developing those vehicles now.
"We're not holding back anything. The requirements whether
they get changed or adjusted or whatever, the bottom line is
clear that electrification is going to play a bigger and bigger
role ... in China and other markets as well," Ford Motor Co
CEO Mark Fields told reporters at a pre-show event this
Industry executives expect Beijing to ask automakers
operating in China ultimately to generate green car credits
equivalent to 12 percent of annual sales volume with NEVs by
around 2020, with each green vehicle getting a different number
of credits depending on the level of electrification and driving
Automakers and government officials have been bargaining
over China's electric vehicle policy for years.
In the latest draft policy released in September, Beijing
proposed a requirement that they generate credits equivalent to
8 percent of automakers' sales next year by selling battery
electric or plug-in hybrid vehicles, rising to 10 percent in
2019 and 12 percent in 2020. More recently, the government has
indicated that timetable could slip.
Whatever target the government sets, automakers would have
little choice but to comply. China is the world's biggest auto
market by far, and growth is set to continue this year, albeit
at a slower 5 percent, according to the China Association of
That is why even as automakers fight electric vehicle
mandates in the United States, they are scrambling to develop
more plug-in electric hybrids and electric battery cars for
Ford, for example, says that by 2018 it will launch in China
a plug-in hybrid sedan called the Mondeo Energi, a version of
the low-volume Ford Fusion Energi offered in the United States.
It also plans to bring an all-electric sport-utility vehicle to
China over the next five years.
General Motors Co, one of the largest automakers in
the Chinese market, plans to launch at least 10 NEVs by 2020. To
support the growth of its NEV line-up, GM has built a battery
assembly plant in Shanghai which should be ready to deliver
battery packs next year.
Volkswagen plans to have 13 additional NEVs by
2020 based on its current generation of technology, following on
plug-in hybrid versions of the Phideon sedan, due to be unveiled
later on Tuesday, and the Audi A6L sedan. The VW brand aims to
further launch 10 electric vehicles between 2020 and 2025.
The German manufacturer also hopes to form a joint venture
just for NEVs with Anhui Jianghuai Automobile Group (JAC)
, and any models from that partnership would be on
top of those plans, a spokesman told Reuters. VW said in January
the first VW-JAC car could be produced next year.
China's drive for electric vehicles, driven in part to
combat often suffocating urban smog, has put pressure on Japan's
Toyota Motor Corp to re-think its earlier scepticism
about battery-electric technology. Toyota has said it will
locally build plug-in hybrids and sell them in China, starting
in 2018, although it has not said when all-electric car models
would hit Chinese showrooms.
To be sure, even as automakers renew commitments to produce
more NEVs, it's not clear how aggressively they would push those
cars in the marketplace.
"All automakers in China are still trying to understand the
implications of the more stringent fuel efficiency regulations
and whether to increase production of qualifying NEVs or
purchase NEV credits from other automakers, including their
partners," said James Chao, Shanghai-based Asia-Pacific chief of
consulting firm IHS Markit Automotive.
(Reporting by Jake Spring and Norihiko Shirouzu in SHANGHAI,
with additional reporting and editing by Joe White in
DETROIT/SHANGHAI; Editing by Ian Geoghegan)