Small and micro electric cars may become the pioneer to crack the sluggish EV market in the near future through individual purchases and emerging urban e-car rental business.
“Based on the sales plans that have been submitted from Chinese EV makers, the combined target sales of small and micro electric cars have already surpassed 10,000 before the end of 2013,” said Ouyang Minggao, a leading expert on energy-saving and new energy vehicles, at an EV conference held in Hangzhou on August 10.
The anticipated sales figure is a big progress given that China only sold 5,579 battery electric vehicles in 2011, according to statistics from China Association of Automobile Manufacturers (CAAM).
Major Chinese car manufactures have all developed and produced small-sized EV models so far, according to Ouyang, who is also professor at China’s prestigious Tsinghua University.
“The first mainstream EV products that will possibly reach meaningful market scale in the next few years could be small and micro e-cars,” noted Ouyang.
Lin Cheng, deputy director of the National Electric Vehicles Engineering Laboratory and professor with Beijing Institute of Technology, observes that EV pioneers in Germany, Japan and South Korea have tried to break into the EV market by launching mini cars such as the Mercedes-Benz Smart, Mitsubishi i MiEV, Nissan Leaf and Subaru Rle.
The international experience shows that small-size EVs are better suited for volume production and sales. Hence Lin suggests China should follow the examples to open up the market by first making small electric vehicles.
“It is more meaningful to develop light and small-size electric vehicles considering our current level of battery technology. EV industrialization will be realized first with small-size cars,” said Fu Yuwu, secretary-general of Society of Automotive Engineers of China. Fu based his observation on a tour to the EU countries last year.
The idea is echoed by other experts including Yang Yusheng from the Chinese Academy of Engineering who strongly supports giving the priority to developing micro EVs. “Once vehicles are made smaller, all the technical difficulties will be easier to fix,” Yang said.
Yang believes small electric automobiles enjoy several advantages for promotion and popularization.
Smaller vehicles consume less electricity power and are faster and easier to charge. For a drive range of 100 km, small vehicles consume 8 to 10 kWh and mini cars just 5 to 6 kWh.
Besides, it costs less to build and service small vehicles which are usually simpler in structure. Small vehicles are more attractive to consumers because batteries for micro EVs are less expensive and come in many varieties.
CBU/CAR learned from an earlier NEV conference in Shanghai that several Chinese government departments were discussing the definition of short-range pure electric passenger vehicles.
The proposed definition of short-range pure EVs refers to vehicles with a maximum speed of 80 km/h and a minimum drive range of 50 km in urban conditions. This should consist of most of the small and micro EVs.
For instance, the electric two-seater EJ02 from Dongfeng Automobile Co., Ltd. has a top speed of 80 km/h and a drive range of 110 to 150 km. Price tag of the EJ02 is set at around ¥40,000 ($6,350) after the promised purchase subsidies.
Sales of the Chery QQ3 EV, the electric version of the popular QQ series, reached 3,000 units in 2011. Hundreds of the QQ3 EVs are being sold monthly and sales set a record high in March 2012 with 452 units.
Micro EV as rental car
“Small electric cars, such as the Roewe E50, are the perfect cars for short distance urban driving and are what we want for our hourly rental business,” Ye, Qing, marketing director of a Hangzhou-based car-sharing startup company, told CBU/CAR.
The Evnet, founded several years ago, used to be a conventional car rental company but recently it has tapped in electric vehicles.
According to Ye, the company now has three F3DM in service. The hourly rental rate is around ¥20.
“Renting electric cars can save up a great deal money compared with the gasoline cars,” he said. For an e-car to run 100 km, the electricity cost is only ¥20. But for the same distance the fuel cost is on average ¥80 for a 1.8L car.
The company is negotiating with Shanghai Automotive Industry (Group) Corp. (SAIC) to introduce the small two-seater Roewe E50 to the service fleet.
“It is less costly for us to buy these electric cars. On the part of the users, these cars are cheaper to rent, and more convenient to use,” Ye noted, adding that finding a parking place in the crowded city would be much easier. Two micro e-cars can even share one parking slot.
As a Hangzhou-based rental company, it had considered introducing EV products made by local manufacturers such as Kandi and Zotye. The company gave up Zotye because its electric vehicles are too big for individual mobility.
“Kandi turned us down because the company is planning to set up its own EV rental business,” said Ye.
Earlier in July, Zhejiang Kandi Vehicles Co. signed a deal to sell 20,000 electric cars to China Aviation Lithium Battery Co., Ltd. (CALB) for an EV leasing project in Hangzhou, the largest scale of its kind in China.
Kandi is responsible for making the two-seater cars. CALB will produce the battery packs. Charging and leasing services will be provided by a local power grid company and newly assembled business operators.
These cars are to be powered by Li-ion batteries which can ensure a range of 100 km. Top speed is 70 km/h. In summertime the drive range is around 85 km with air conditioning on.
The small Kandi e-car is priced at ¥90,000. Since Hangzhou is one of China’s five pilot cities that can enjoy purchase subsidy of ¥60,000, the average cost for each car is ¥30,000.
Monthly rental price is said to be between ¥700 and ¥1,000. With a projected income of ¥850 per month, the cost of the EV will be recovered in three years.