Finweek English Edition - - COVER STORY -

By 2025, Cal­i­for­nia law man­dates that EVs ac­count for 15% of sales in that state. This should bring about a sea change in the in­dus­try, given that only two car mod­els, Tesla and the Nis­san Leaf, were able to shift more than 1000 units dur­ing the f irst quar­ter of 2013. But to put th­ese fig­ures in per­spec­tive, Ford’s F-Se­ries pick-ups sell at a rate of over 2000 units a day

EV sales have dou­bled in the first few months of 2013 com­pared to the same pe­riod in 2012. But there is a caveat. “For the next 10 years,” says Jochem Heiz­mann, head of Volk­swa­gen in China, “gen­er­ally plug-in hy­brids have a much bet­ter chance to be­come a rel­e­vant vol­ume in com­par­i­son to just fully elec­tric cars.”

To y o t a ’ s Ch a i r ma n Ta k e s h i Uchiya­mada, be­lieves that “hy­brid ve­hi­cles with­out a doubt will be­come a ne­ces­sity” in China’s grow­ing mar­ket.

Com­pared to China’s to­tal car mar­ket, of more than 19m ve­hi­cles sold per an­num, the EV mar­ket re­mains tiny. But if Cal­i­for­nia’s green laws look tough, China’s are hardly a dod­dle ei­ther. Bei­jing wants 500 000 hy­brids and EVs in cir­cu­la­tion by 2015, and 5m by 2020. Even with China’s govern­ment in­cen­tives, con­sumers bought fewer than 12 000 EVs in China in 2012.

Pur­chase costs and a lack of in­fra­struc­ture limit the mar­ket. Ex­perts say sub­si­dies in EVs are mis­placed and should be di­rected to­wards hy­brids, which have the plug-in op­tion, are less ex­pen­sive and re­quire a slower roll-out of in­fra­struc­ture.

One op­tion would be to sim­ply tai­lor sub­si­dies to fuel ef­fi­ciency – in other words greater sub­si­dies for greater ef­fi­cien­cies.

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