SHANGHAI – The 2011 Global Automotive Symposium® (GAS 2011) –Commercialization and Industrialization of Hybrid and Electric Vehicles: Global Development and China’s Experience, hosted by China Business Update/China Automotive Review (CBU/CAR), was successfully held in Shanghai on April 20-21, 2011 at the Crowne Plaza Century Park Hotel in Shanghai, right before Auto Shanghai 2011, this year’s largest automotive trade show in China.
Nearly 150 representatives from global and Chinese OEMs, suppliers and industry associations involved in the new energy vehicle (NEV) industry gathered at the symposium to discuss the latest global development in the commercialization and industrialization of hybrid and electric vehicles (EVs), as well as efforts and achievements these companies have made in China and opportunities and challenges they are facing on the road to electrification. Twenty-five top executives from the NEV industry, academia, and R&D departments of relevant enterprises delivered insightful speeches at the two-day conference, which featured eight panels and two roundtables covering the following topics:
I. Policy, Standards and the Market
II. Hybrids, Plug-ins or BEVs?
III. Roundtable: 2011 – Year of Plug-ins and BEVs?
IV. Supplier Efforts & Challenges
V. Global Electrification Efforts & Trend
VI. Hybrids, Plug-ins or BEVs? (II)
VII. Round-table: Government & Industry Initiatives
VIII. Power Batteries and Charging Facility Operations
This is the second Global Automotive Symposium® CBU/CAR has held, and is also its 16th annual international conference event. GAS® 2011 focused on the development of NEVs, and was launched in the context that problems such as energy shortage, traffic congestion and environmental pollution are becoming increasingly severe and that China has drafted a long-term Energy-Saving and New Energy Vehicle Industry Development Plan (2011-2020), and especially at the crucial moment when China and the entire world are making decisions on how to develop the NEV industry. It thus shared a unique sense of history in the way of gathering together representatives of relevant downstream and upstream enterprises in the NEV industry to discuss solutions to the commercialization and industrialization of hybrid and electric vehicles in China and around the globe.
Dr. Wayne Xing, publisher and editor-in-chief of CBU/CAR , said during his opening speech, “365 days ago in Beijing, when CBU/CAR held GAS® 2010, we decided on the theme of GAS® 2011 based on the simple reason that China will probably be leading the way in the development of NEVs and become the first country in the world to commercialize and industrialize hybrid and electric vehicles. This trend is beyond question.”
Professor C.C. Chan, President of World Electric Vehicle Association, predicted at the welcome dinner on April 19 that EVs would account for 7-12 percent of the world’s auto sales by 2020, while the proportion in China may reach 15-20 percent. He emphasized that China should take advantage of its natural resources, market and talents to greatly develop EVs as well as energy-saving and fuel-efficient vehicles, such as small low-speed EVs, EVs for urban public transportation and pure EVs in accordance with its national conditions. Development of other types of hybrid vehicles is also encouraged if there is a market, he added. “China needs to accumulate experience and continuously improve its own technology such as batteries, power electronics, electric motor, powertrain, etc. to retain a leapfrog development,” said Chan. Meanwhile, Chan pointed out that vehicle electrification will be a revolutionary move and the development of NEVs will be completely different from that of the existing industries. He appeals to all interest groups to open their minds in progress towards commercialization of NEVs, underlining that the world cannot be changed with a closed mind, especially when faced with such a revolutionary, disruptive industry.
Rao Da, Secretary General of China Passenger Vehicle Association (CPVA), stated that China’s automobile parc will exceed 200 million units by 2020 even if the market experiences zero growth annually over the next decade. “China is in urgent need of NEVs, battery technology remains a major obstacle to their industrialization,” pointed out Rao.
Jeff Henning, Global Automotive Markets Leader of Ernst & Young, believes that 2011 is a key year for the industrialization of NEVs, because it will be a year in many major markets around the world where vehicle manufacturers’ EV assumptions and technologies will begin getting tested with true retail customer feedback.
Chen Quanshi, Director of Automotive Research Institute of Tsinghua University, said that standards are hindering the industrialization of EVs for now, underscoring that the EV industrialization will not be achieved without industry-wide standards. He figured that EVs should not be too advanced, big and luxury, but should be small and lightweight with low-level configuration.
Nancy Gioia, Director of Global Electrification, Ford Motor Co., estimated that a quarter of Ford vehicles sold globally in 2020 will be electrified, and 70 percent of those electrified vehicles will be plug-ins. Ford revealed on April 19 its electrified vehicle plan in China for the first time, with the Asian debut of the company’s latest electrified vehicles and a plan to have a demonstration fleet of new energy vehicles in the country later this year.
Wu Xuebin, President of Foton Automotive Engineering Institute, predicts that the industrialization of NEVs in China will be fully achieved in 2024. Foton already has new energy buses, electric sanitation vehicles and a fleet of 50 pure electric taxis running in and around Beijing and other cities in China.
Misaki Masami, Vice President of Nissan (China) Investment Co., Ltd., emphasized that customer education is one of four issues waiting to be resolved in the path to EV commercialization and industrialization, with the other three being improvement of EV performance, initial demand creation by preferential policies and preparation of EV charging infrastructure. Nissan will begin a fleet testing of 25 units of the Leaf pure electric vehicle later this year in Wuhan, Hubei Province, where its Chinese partner Dongfeng Motor is based.
Margaret Baxter, Senior Vice President of OESA, holds that the supplier community will be the most important link in value addition and technology R&D of EVs.
In the first roundtable held on the afternoon of April 20, panelists stirred a fierce debate about the actual development and future prospects of low-speed EVs in China, as well as the actions and measures their respective companies have taken in the process of industrialization, regarding rural and urban markets, government policies, hybrid control, test and operation practices. A consensus was reached that the year 2011 is the first year for the NEV industrialization, while the time for ultimate industrialization still remains a question.
In the succeeding panel of Supplier Efforts & Challenges, Klaus Braunig, Managing Director of VDA, Rolf Najork, Vice President of Schaeffler Group, Ray Shemanski, CEO of Johnson Controls-SAFT, and Li Ming, chief engineer of Delphi Packard Electrical/Electronic Architecture (Delphi-E/EA), Asia Pacific delivered in well-elaborated manners the efforts and challenges of their respective companies in EV industrialization.
Zhang Yanhui, Assistant to the President of New Energy Vehicle Research Institute at Jianghuai Automobile Co., Ltd. (JAC), introduced the company’s three major development goals for the 12th Five-Year Plan (2011-2015) period. First, strive to become a top three independent EV manufacturer; Second, build the capability of industrialization of R&D; and third, increase annual output and sales of EVs to 100,000 units. “JAC’s technique route to EV industrialization is emphasis on pure electric small cars, and co-develop mid- and high-end plug-in passenger vehicles.
Mirko Kerschbaum, Director, Global Business Development, Auto Alliances, Better Place, said the company will initially promote its network of battery-swap stations in Israel, Denmark, Japan and other countries, adding that these stations can provide services for battery packs of different sizes. Better Place is currently in talks with many domestic OEMs and infrastructure providers on possible cooperation, including Chery, China’s largest independent automaker. The company inked a deal with China Southern Grid on April 27 for the construction of pilot battery swap stations in Guangzhou.
Yongmei Kimmel, NEV Strategy Manager at PSA Asia Pacific, disclosed that the French auto maker has set up plans to develop NEVs for the Chinese market: to develop for China and be conceived and made by China. The company will first put on its target market a plug-in vehicle with gasoline engine, and then develop a pure EV dedicated for the Chinese local market.
As for whether 2011 is the year that the EV era starts, Ivan Hodac, Secretary General of European Auto Manufacturers’ Association (ACEA), said he personally thinks the year 2011 is “year zero.” Hodac believes that up to 90-95 percent of vehicles will remain to be powered by internal combustion engines before 2025. The standardization of EVs should not hinge only on the EU level, he stressed. It requires for an urgent action on the global unification instead. In terms of subsidies, Hodac said, the EU does not have a unified program for NEVs either, so the subsidy programs and standards among its members also vary significantly.
Keith Cole, Vice President, Government Relations & Public Policy, GM International Operations, said the U.S. automaker will officially launch its Chevrolet Volt extended-range plug-in electric vehicle in China in Q4 2011. While the Chinese government has not made it clear that whether imported EVs such as the Nissan Leaf and Chevrolet Volt are eligible for subsidies, GM will therefore launch only a small batch of the Volt cars in China at first, primarily for demonstration effect.
Wu Jianzhong, Chairman of Zotye Holding Group, explained for the first time in public details of the self-burning incident of one of its EV taxis in Hangzhou, Zhejiang Provicne on April 11, saying that the company launched its first pure EV in China in March 2009 and the Hangzhou accident is the first in more than two years. “Risks are always there in either manufacturing traditional vehicles or NEVs, let alone being a pioneer in the field. What more important is how much we can control the risks,” Wu said, adding that the risks of the company’s NEVs are controllable at present. In response to this incident, Zoyte will carry out a series of rectification in its EV demonstration program, from the organization and institution to the technology. Moreover, the company will build a remote monitoring platform on all its EV taxis in operation to detect and address problems in a timelier manner and avoid potential risks.
Aside from that, Wu narrated Zotye’s efforts in EVs through the illustration of “Simplicity,” “Unchanging,” and “Change” borrowed from the ancient Chinese wisdom Zhou Yi. To sum up the company’s practice in NEVs, Wu said: “Zotye has no interest in disputes over uncertainties, such as ‘high-speed and low speed, long-range and short-range, lithium-ion and lead batteries, recharge and battery swap, pure electric and plug-in, vehicle purchase and vehicle rental ,’ we will only do what we can do and let the market decide. ”
Henry Li, General Manager, Auto Export Trade, BYD Auto, forecasted that more than half of cars sold in 2020 in China will be new energy vehicles. He also indicated that the company plans to enter the North American and European markets in 2012.
Lin Yi, Executive Director of Beijing Electric Vehicle Co., a subsidiary of BAIC Group, said BAIC will strive to achieve the goal of building Beijing into the largest and most comprehensive R&D and manufacturing base for NEVs in China by 2015. This year, BAIC aims to boost sales and production of its NEVs to 3,500 units. By 2015, the Group will be ready to produce 150,000 (including 55,000 BEVs) NEVs, 180,000 control systems, and 150,000 electric drive systems, with sales revenues exceeding ¥15 billion ($2.30 billion). In recent years, BAIC has invested a total of ¥3.78 billion in NEVs, of which ¥1.5 billion was spent in new energy commercial vehicles, ¥1.7 billion in Beijing EV, and ¥580 million in batteries, motors and other components.
Hu Jiangyi, Deputy Director, Sales & Marketing, State Grid, revealed that his company has conducted extensive communication and cooperation with the upstream and downstream enterprises worldwide since it started promoting the use of EVs in 2006. As the largest electric power transmission and distribution company in the country, State Grid has also carried out other aspects of work including the standard preparation, research of key technologies for recharging and battery swap, research and practice of business models, construction of charging stations, etc. The company follows an operating model that allows it to largely develop battery swap and provide charging solutions as a supplement, in addition to a concentrated charge and uniform distribution of fixed charges. As of the end of 2010, the company had established strategic cooperation agreements with 273 provincial and municipal governments on construction of EV charging stations, put into operation 87 battery charging and swapping stations, 5,179 charging poles and 7,031 AC charging poles, making China a country with the most EV charging facilities in the world.
When it comes to the application of lithium-ion batteries to EVs, Deng Zhongyi, Vice President, Sales, BAK Batteries, pointed out that mass production of EV batteries still faces major challenges such as consistency and life cycle, as well as size, cost, safety, reliability and materials. Deng states that the standards and regulations for batteries should be based on market data, not on government decisions.
Liu Yaqi, Vice President of Shanghai E-Bus New Energy Technology Co., Ltd., said the company had put its battery exchange station for EVs – E-Station – into use in Lanzhou, Beijing, Shanghai and Guangzhou by the end of last year. E-Bus first applied its E-Station for e-bus route No. 31 in Lanzhou in 2005, and then for the Beijing Olympic Games in 2008, the World Expo 2010 in Shanghai, the 2010 Asian Games in Guangzhou and other large international activities. Liu mentioned that the so-called E-Station is an integration of recharging, battery swapping and energy storage, quite different from traditional charging stations. He continued that the E-Station is aimed at easy maintenance and charging with the ladder logic.
Dr. Wayne Xing, in closing the two-day symposium, said that the Chinese government’s move of draft the Energy-Saving and New Energy Vehicle Industry Development Plan (2011-2020), but not another five year plan for the China automotive industry is to brew up a long-term strategic plan for the industry. “China will earmark more than ¥100 billion ($15.4 billion) in alternative energy-powered vehicles in the coming decade. And, of course, NEVs in China are confronted with a disruptive revolution, which will bring radical changes to the exiting traditional automotive industry,” said Xing. “Some people will definitely get hurt in this revolution, all constituents in relevant industries should brace for a tough battle.”
Detailed transcription of the entire GAS® 2011 proceedings in Chinese can be found at CBU/CAR ’s sister Chinese website, www.cbuauto.com.cn, as well as the special report section on auto.163.com, our media partner, at http://auto.163.com/special/2011globalautomotivesymposium/?1303471838189.
GAS® 2011 was supported by European Automobile Manufacturers Association (ACEA), Automotive Industry Action Group (AIAG), Japan Automobile Manufacturers Association (JAMA), Original Equipment Suppliers Association (OESA), German Association of the Automotive Industry (VDA), China Europe International Business School (CEIBS) and Detroit China Business Association (DCBA). Ernst & Young was our exclusive Platinum Dinner Sponsor and Scheffler Group our Gold Luncheon Sponsor. Our media partners were auto.163.com, cars21.com, gasgoo.com, evtimes.cn and motorlink.cn.
Since 1996, CBU/CAR’s annual international conference has matured into a unique gathering place for industry executives, both home and aboard, to exchange views on the automotive industry. Participants not only have access to the in-depth discussion about the Chinese automotive market and value-added services, but also are presented with a high commercial value communication platform to meet high-level executives within the industry.
CBU/CAR has already begun preparing for our 2012 Global Automotive Symposium® − Sales, Distribution and Aftersales Service − Opportunities & Challenges of China’s $80 Billion Aftermarket, to be held at the Westin Beijing Chaoyang Hotel on April 24-25, 2012.