Will China Eat Our Lunch in the Electric Vehicle Market? Probably.
I’ve written several times over the past seven years about BYD, the amazing China-based manufacturing conglomerate that’s working at a feverish pace to bring low-cost, high-quality electric vehicles to the world market. Among their advantages is the fact that they are arguably the most vertically integrated company in human history; they own, extract and process raw materials, build batteries and the associated electronic control and management systems, assemble drive-trains, and insert them in a huge fleet of cutting-edge EVs. Here’s an article on the subject, written by my colleague Jon LeSage at the Green Auto Digest.
Will this cause a problem for companies like GM and Ford? It’s hard to imagine how it couldn’t. Pictured above is Ford’s entrance into the EV market, the Focus. With the exception of electric drive and an MSRP almost $13,000 higher than the gasoline version of this unattractive little junk-heap, it’s identical. How appealing can that possibly be?
Craig,
EV development in the PRC is happening on a large scale for many Western countries, but only on a small scale for China.
Quality control for PRC vehicles manufactured for the domestic market is of a different standard than export. The PRC is a replicator, not innovator. BYD technology is not invented or developed in the PRC, nor even improved. PRC R&D reamins heavily dependent on stolen or purchased western technology and production techniques.
Your praise and awe for;-
“vertically integrated company in human history; they own, extract and process raw materials, build batteries and the associated electronic control and management systems, assemble drive-trains, and insert them in huge fleet of cutting-edge EVs ”
isn’t accurate !
Vertically integrated corporations were a fashion in the late 19th and early 20th century .Corporations like International Harvester, GM and Ford FIAT etc operated vertically integrated business models. In the 1930’s this business model became orthodoxy in Soviet and socialist economic structures.
The flaws rapidly became obvious. As a result the model was abandoned in the West. BYD survives in the remnants of a semi-socialist nation, where inefficiencies can be covered up by government policies.
Just because an EV uses a different drive train, doesn’t exclude the vehicle from all the other requirements of a modern automobile. These features add considerably to the weight,energy consumption, and cost of manufacture.
Nor is there anything special or advanced about the BYD EV drive train or ECD. In comparison to Tesla, GM Volt- Bolt, Renault-Nissan, BMW, Toyota, VW Hyundai or even Ford, the technology is relatively primitive and uninspiring.
Your description of the Ford Focus as an ” unattractive little junk-heap” is obviously subjective. The Ford Focus range has for the last eighteen years proved highly popular. The model’s sales success has been outstanding.
The Focus EV version is quite a competent motor vehicle, although with strengths and weaknesses from sharing components with it’s ICE siblings.
Ford was a very early pioneer in EV development, perhaps too early. Although the early models were technically interesting, the market just wasn’t ready for a volume EV.
Despite pontificating by armchair ‘know-it-all’s, EV’s are more expensive to build in volume than conventional models. The main cost are associated with the ESD and electronics.
ESD is very expensive technology. The Ford Focus EV was never intended as a volume seller and only offered in limited markets. Ford has mainly concentrated on hybrid development.
Even with massive state subsidies,heavy government investment,including secret government guarantees for private investors, BYD quality remains substandard and relies heavily on acquiring western technology and assistance.
PRC auto-manufacture lacks the ferocity of the Korean market, or the diligence and dedication of the Japanese work force. Jon LeSage’s article reads like a company press release. PRC vehicles are improving and with heavily subsidized prices for export models, will become another competitor in the marketplace.
The problem for PRC manufactures is the lack of domestic prestige marques. It’s these brands which allow automotive innovative features to be introduced and adopted in volume models.