Autoshow - Electric vs hydrogen: China is battleground for auto giants

GUANGZHOU/BEIJING Fri Nov 22, 2013 9:21am IST

Volkswagen Vision GTI is introduced at the Los Angeles Auto Show in Los Angeles, California, November 20, 2013. REUTERS/Mike Blake

Volkswagen Vision GTI is introduced at the Los Angeles Auto Show in Los Angeles, California, November 20, 2013.

Credit: Reuters/Mike Blake


Priyanka Gandhi Vadra, daughter of Congress party chief Sonia Gandhi, adjusts her flower garlands as she campaigns for her mother during an election meeting at Rae Bareli in Uttar Pradesh April 22, 2014. REUTERS/Pawan Kumar

Election 2014

More than 814 million people — a number larger than the population of Europe — are eligible to vote in the world’s biggest democratic exercise.  Full Coverage 

GUANGZHOU/BEIJING (Reuters) - German auto giants Volkswagen AG(VOWG_p.DE), BMW (BMWG.DE) and Daimler (DAIGn.DE) see China's future as being electric - encouraged by generous government subsidies - but that bet puts them at odds with some of their Asian rivals.

While the Europeans were heralding the all-electric vehicle at the Guangzhou auto show this week, Toyota Motor (7203.T) and Honda Motor (7267.T) were unveiling hydrogen fuel cell cars at shows in Tokyo and Los Angeles.

The two Japanese heavyweights plan to start selling their hydrogen vehicles in 2015, brushing off electric technology as being good enough only to power tiny city cars.

One of the most ambitious in betting on electric cars in China, the world's largest auto market, is Volkswagen.

On the eve of the Guangzhou show, Volkswagen said its brands, including Volkswagen and Audi, plan to launch a total of more than 15 near-all-electric plug-in cars by 2018, many of which will be locally produced.

"We forecast high volumes in this area," Jochem Heizmann, head of Volkswagen Group China, told reporters this week.

BMW and its local partner Brilliance Auto unveiled a jointly developed all-electric battery car in Guangzhou. The two companies plan to start leasing the car next year under a new jointly run China-only brand called Zinoro.

Daimler said it was also on track to launch an all-electric car next year under a new China-only brand called Denza, which the German company operates jointly with Chinese battery and car producer BYD Co (002594.SZ).

The rush into all-electric cars comes as Beijing ramps up a programme to put 5 million new energy vehicles - defined as all-electric battery vehicles and heavily electrified "near all-electric" plug-in hybrids - on the road by 2020.

China this year expanded the definition of new energy cars to include fuel cell cars.

The two concepts have polarised the industry.

Fuel cell cars can run up to five times longer than their all-electric counterparts, but come with a heftier price tag.

But unlike electric vehicles which can be recharged from home as well as charging stations, fuel cell cars must stop at refilling stations. The hydrogen stations are costly to build, at about $6 million apiece.


Some industry insiders and experts believe China is too focused on all-electric cars or plug-ins.

"Toyota believes the industry isn't likely to come up with breakthroughs to make all-electric cars a viable solution any time soon," said Yale Zhang, head of Shanghai-based consulting firm Automotive Foresight. "Unlike China, some countries have taken a more flexible approach, rather than setting the path on one solution too early."

Toyota, in particular, thinks all-electric car technology is good enough to power only tiny city cars - not powerful enough for larger cars.

At this week's Tokyo Motor Show, Toyota unveiled a fuel cell concept sedan with two hydrogen tanks and a driving range of 500 km (310 miles). The car, it said, would sell for 5 million to 10 million yen when it goes on sale in 2015.

Honda also unveiled a five-passenger hydrogen fuel cell vehicle at the Los Angeles Auto Show this week. By his own admission, the company's chief executive of its U.S. business, Tetsuo Iwamura, expects uptake to be slow due to poor infrastructure.

In China's congested and bustling cities, electric charging or hydrogen fuelling stations are a rare sight. Volkswagen says the infrastructure is not good enough, and believes plug-in hybrid technology is the solution.

Plug-in cars come equipped with a small gasoline engine that can power the car when it is drained of electricity.

Nissan Motor (7201.T) plans to sell a fuel cell car in Japan and North America starting in 2017, but like Volkswagen, sees electric technology as the future in China, according to Ren Yong, a senior executive of Dongfeng Nissan Passenger Vehicle Co, Nissan's Chinese venture with a local partner.

Nissan plans to start selling a locally developed electric car in China under the Venucia brand as early as next year. (Editing by Jeremy Laurence)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see
Comments (1)
MarkIV wrote:
The way forward?

Nov 22, 2013 9:04pm IST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared



Election 2014

Election 2014

Thousands mob Modi as election race starts in Varanasi.  Full Article 

Monsoon Forecast

Monsoon Forecast

Met office rules out surplus monsoon in 2014.  Full Article 

Facebook's Performance

Facebook's Performance

Facebook Q1 revenue grows 72 percent on rising mobile ads.  Full Article 

Earnings Season

Earnings Season

Bharti Infratel Q4 net profit jumps 64 percent.  Full Article 

Solar Dispute

Solar Dispute

Green groups urge U.S. to drop solar trade case against India.  Full Article 

Oil Imports

Oil Imports

India to make May-July oil payments to Iran - sources.  Full Article 

Rice Exports

Rice Exports

India may cede top rice exporter spot under Southeast Asian price onslaught.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage