Will US & European car industry survive super-cheap Chinese EVs?
EVs set to take off in China as rural consumers embrace $4,400 model. Shanghai auto show opens, targeting middle class buyers in cities next
SHANGHAI — China’s biggest auto show features electric vehicles priced within reach of the rural and middle-class buyers essential for propelling the country’s green car market into high gear.
At Auto Shanghai 2021, which opened Monday, attendants at SAIC-GM-Wuling Automobile’s booth touted the success of the company’s super-affordable model, the Hong Guang Mini EV.
“It sold 270,000 units in just 270 days, and it ranked at the top of China’s EV sales for seven consecutive months,” one pitch person said.
The joint venture, which includes General Motors and is majority owned by Shanghai-based SAIC Motor, has been strong in compact commercial vehicles. But the company released the Hong Guang Mini in July 2020 starting at 28,800 yuan ($4,420 at current rates). The vehicle became a hit in rural areas, where most live in single-family homes.
Though the EV measures just 2.9 meters long and 1.5 meters wide, it can seat four people. The car can plug into a household outlet, negating the need for separate charging equipment. The Hong Guang Mini also benefits from local government subsidies offered to stimulate China’s post-COVID economy.
For consumers who cannot afford most cars, the Hong Guang Mini provides a new option apart from simple vehicles that resemble electric carts. Unlike the carts, the EV can be covered by auto insurance.
The low price makes the car conspicuously austere in its functionality. The vehicle runs only 120 km on a single charge, and its speed maxes out at 100 kph. Safety features are limited, and air conditioning is optional.
Yet 72,498 Hong Guang Minis were sold in the first quarter of this year, industry figures show. That ranks the EV as China’s top-selling passenger auto among so-called new-energy vehicles (NEVs), surpassing the Tesla 3.