Forget volatile, highly competitive markets; fluctuating currency rates; customers dumping cars in favor of SUVs; rising interest rates; and the fact that millennials don’t want to own a car.
The most feared phrase in the car industry today is this:
China is already the world’s biggest polluter, although it is making an effort to curb its emissions, but it could solve the rapidly growing vehicle pollution problem overnight!
All the Chinese government has to do is use the phrase: “China Goes Electric”.
THAT’S the real reason the world’s carmakers are committing to producing electric cars. China doesn’t care if electric cars are recharged from a coal-fired power grid, it just wants fossil-fuel cars off its roads, and fast!
So if the world’s car companies don’t have a wide range of electric vehicles in their catalogue, then they will lose out by not being able to sell cars in China. It’s that simple.
However, the Greens shouldn’t be celebrating, because there remains the problem of pollution from burning coal, and China is not about to stop doing that anytime soon.
Most urban car use in China is only short distance trips, so there’s little fear of ‘range anxiety’, for the moment. Those companies, like Tesla, who offer electric cars are in the box seat.
China is also fast-tracking work on fuel-cell vehicles (FCEVs); because even though making Hydrogen gas consumes a huge amount of electricity, the Chinese have got power to burn – literally.
This is why, what happens in China will govern what happens around the globe, and the car companies know that if they are going to have any sort of money-earning future, they all have to pay attention to China.
After all, it’s now the biggest car market in the world!