Growth of electric minicars exploding in China

Clean Capital SJ Liew

By Justin Bull

December 12, 2013

China is the world's largest car market and also has some of the world's most polluted cities. The government, concerned about air quality, is making it increasingly difficult for people to register cars – in Shanghai only 20,000 new vehicles can be registered per month.

Savvy consumers are exploiting a legal grey area and rapidly adopting three-wheeled electrified cars as a response. Priced under $3000 and manufactured by almost a hundred different companies in China, these cars are popular with seniors and families who need the convenience of a car, but want to avoid the costs and regulatory requirements of the internal combustion engine.

The minicars, officially known as "elderly walk-substituting vehicles," are outselling full-speed electrified vehicles. 20,000 of these vehicles were sold last year, a figure expected to grow to 300,000 in 2015 and 1 million by 2020. This booming vehicle segment unfortunately relies on coal-fired power plants to charge their batteries, which have an eight-hour run time with a maximum speed of 40 km/h.

With the explosive growth of services like Car2Go and the release of an electrified Smart Car, it is clear that transportation norms are changing. In British Columbia the government has a series of incentives in place to encourage vehicle electrification, including subsidies for developers to install charging facilities, incentives to buy electric vehicles, and programs to reimburse homeowners who install charging stations. Given that 93% of BC's electricity comes from renewable sources – mostly hydroelectric dams – electric vehicles here don't need to rely on dirty coal to maintain a charge.

As the electric vehicle market emerges, the challenge will be in creating conditions conducive to mass-market adoption. For cities throughout Canada, updating legal and regulatory codes to match technological realities will be key to unlocking the next generation of transportation choices.



Photo Credit: SJ Liew