It was a couple years ago, when China overtook the U.S. as the largest new car market in the world, that it started to become clear to me the U.S. wouldn’t have the same influence in the development of this next generation of automobiles as we did in the first.
As witnessed by the incredible amount of diversity of green car tech at the Beijing Auto Show this year, China has suddenly become the place to watch for emerging car trends — and it’s getting a larger share of the limelight to boot.
The world of the vehicle is changing drastically. At this point I’m positive that we’ll look back 30 years from now and see this period of time as just as transformational as the 30 years after the automobile was first invented. And, as we start this change, one thing is becoming clear: the U.S., as a society, is likely to play a relatively small part in how it unfolds.
We didn’t invent the automobile here in the U.S., but we did take the concept of personal mobility and make it infinitely more affordable and functional — and ingrained it more fully into our everyday lives than any other society. This wholehearted adoption was one of the keys to our huge success over the last half century or so, but it is also one of the major reasons we’re kind of stuck working within the system we’ve created for ourselves.
For everything from how we fund roads, to how we distribute energy, to what industries we subsidize, to what factors our economic markets are geared towards, to how we get to work, to how we value our mass transit and train systems, we are finding that adopting next generation plug-in cars is exceedingly difficult. Fitting the new system into an old framework is like trying to stuff your aged self into that pair of hotpants you wore in college (and kept deep in your closet for god-knows-what reason): It may work, but it looks horrible.
In many ways, you can draw an analogy to Europe. For centuries they developed their train/tram systems. When the car came along their cities were already so crowded that the car just never fit into their society perfectly. Their streets and infrastructure weren’t designed with the car in mind. Which is why, although cars are obviously very popular in Europe, they’ve just never developed the U.S.’s fascination with them and they still have a healthy public transit system.
In the U.S., when the car finally came into its own, we were just starting to develop our infrastructure. It was a clear and perfect union. We dumped loads of public money into that relationship and haven’t looked back. But we also aren’t looking forward much either. Although we had trains, we never needed to make them work really well. We just paved a road wherever a train might have gone. I’m not blaming us for this, just stating facts. It was the easiest path of least resistance at the time.
So when you look at China, although they’ve been a society for a LOT longer than the U.S., it’s only in the last decade they have started to come into their own on the economic world stage. Their cities are growing at a rather astounding and frightening pace (they’re building million-plus person cities almost overnight), their population is incredibly young (Fully 50% of the population is under 44), and they are only now starting to think about the infrastructure needed to make the whole country a truly modern one. The Chinese government has a relatively clean slate to work with as they plan and are using that to their advantage by working to integrate electric cars and plug-in hybrids now. Clearly the Chinese book is yet to be written and there are many questions in their ability to get it done, but, as the magic 8 ball might say, “all signs point to yes.”
A recent survey shows that nearly 5-6 times more Chinese residents would consider buying an electric car or plug-in hybrid than in the U.S., Germany, Japan, and the UK. Think about that; 60% of Chinese people already are considering buying an electric car. Additionally, 82% of Chinese respondents say they take the environment into consideration when buying a vehicle. That, in-and-of-itself, is astounding to me. Here in the U.S. less than 1 in 4 (depending on who you ask) would consider buying an electric car right now — although 78% think plug-in AND hybrid vehicles are the way of the future… at some point.
Look, before you get all hot and bothered, I’m not saying that U.S. companies won’t play a key role in developing the technology of the future. I’m just saying that, in my opinion, the average U.S. consumer won’t have much influence on what technology the next generation of vehicles uses. Certainly any capitalist transportation venture worth its weight in snot will take advantage of the fact that the market for plug-in vehicles in China is so hot — including every major U.S. auto manufacturer still left standing.
So, what do you think? Will the U.S. play a lead in the future of transportation, or are we doomed to argue amongst ourselves about the issues until we get passed up by China?
Image Credit: Jakob Montrasio’s Flickr Photostream. Used under a Creative Commons License.
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Don’t overestimate the Chinese. Their government guided capitalism is based on corruption, theft, abuse and generally a remarkable absence of morality. Not an environment for creativity and balanced growth. With 2 percent of the Chinese owning a car the big high rise based cities have already and predictably come to a gridlock. The government needs high growth rates to keep the people happy and to avoid an implosion of the ethnic prison that is China. It’s willing to do what ever it takes to achieve that which makes it a threat to the world, for instance when they technically and diplomatically support the Iranian nuclear weapons project in exchange for oil deals. Every Chinese carmaker is talking EV’s but none of them actually has the technology to build a serious EV. BYD presents itself as the posterboy of the Chinese EV industry but so far their EV’s have been all bluff and no show. They need western technology to get it right and even when they do they will dominate their own market obviously, but by the time they get the quality and design right they won’t be that competitive anymore. In the eighties everybody thought the Japanese would take over everything. Didn’t happen and neither will China.
Don’t overestimate the Chinese. Their government guided capitalism is based on corruption, theft, abuse and generally a remarkable absence of morality. Not an environment for creativity and balanced growth. With 2 percent of the Chinese owning a car the big high rise based cities have already and predictably come to a gridlock. The government needs high growth rates to keep the people happy and to avoid an implosion of the ethnic prison that is China. It’s willing to do what ever it takes to achieve that which makes it a threat to the world, for instance when they technically and diplomatically support the Iranian nuclear weapons project in exchange for oil deals. Every Chinese carmaker is talking EV’s but none of them actually has the technology to build a serious EV. BYD presents itself as the posterboy of the Chinese EV industry but so far their EV’s have been all bluff and no show. They need western technology to get it right and even when they do they will dominate their own market obviously, but by the time they get the quality and design right they won’t be that competitive anymore. In the eighties everybody thought the Japanese would take over everything. Didn’t happen and neither will China.
Don’t overestimate the Chinese. Their government guided capitalism is based on corruption, theft, abuse and generally a remarkable absence of morality. Not an environment for creativity and balanced growth. With 2 percent of the Chinese owning a car the big high rise based cities have already and predictably come to a gridlock. The government needs high growth rates to keep the people happy and to avoid an implosion of the ethnic prison that is China. It’s willing to do what ever it takes to achieve that which makes it a threat to the world, for instance when they technically and diplomatically support the Iranian nuclear weapons project in exchange for oil deals. Every Chinese carmaker is talking EV’s but none of them actually has the technology to build a serious EV. BYD presents itself as the posterboy of the Chinese EV industry but so far their EV’s have been all bluff and no show. They need western technology to get it right and even when they do they will dominate their own market obviously, but by the time they get the quality and design right they won’t be that competitive anymore. In the eighties everybody thought the Japanese would take over everything. Didn’t happen and neither will China.
What Chris O said…and BTW, a good portion of that electricity is brought to you by Three Gorges dam, lets displace over 1,000,000 people – complain and die.
Art and Chris,
My point wasn’t about the morality of the Chinese system… that is a topic for a different blog. While I agree with both of you on many points, none of what you said negates the potential for China to dominate. As I said, it’s far from certain, but they are definitely in the right position to dominate the next gen car realm if they play their cards right. I also said that foreign companies will likely supply China with much of what they need… making the fact that Chinese car companies are far behind kind of moot. Remember, I said it’s not the U.S. companies that won’t shape the car tech of the future, it’s the U.S. people that won’t drive demand. With 1/7 of the world’s population, China is certainly in a better position than Japan was to dominate.
What Chris O said…and BTW, a good portion of that electricity is brought to you by Three Gorges dam, lets displace over 1,000,000 people – complain and die.
Art and Chris,
My point wasn’t about the morality of the Chinese system… that is a topic for a different blog. While I agree with both of you on many points, none of what you said negates the potential for China to dominate. As I said, it’s far from certain, but they are definitely in the right position to dominate the next gen car realm if they play their cards right. I also said that foreign companies will likely supply China with much of what they need… making the fact that Chinese car companies are far behind kind of moot. Remember, I said it’s not the U.S. companies that won’t shape the car tech of the future, it’s the U.S. people that won’t drive demand. With 1/7 of the world’s population, China is certainly in a better position than Japan was to dominate.
“Their government guided capitalism is based on corruption, theft, abuse and generally a remarkable absence of morality.” ??? Chris, have you ever witnessed a Chicago city ward election? HA!
Seriously, the fact that China has virtually a clean slate and about, what?, 4 Billion people to work with will be the deciding factor for demand. America already has its cars and roads and is satisfied, somewhat hesistantly, with its current infrastructure. So world demand for altfuel vehicles will, more than not, be decided by the Chinese and those countries that can start from scratch.
And if India gets its shit together? Whoa, Nelly! Then you’re gonna see a demand war!
“Their government guided capitalism is based on corruption, theft, abuse and generally a remarkable absence of morality.” ??? Chris, have you ever witnessed a Chicago city ward election? HA!
Seriously, the fact that China has virtually a clean slate and about, what?, 4 Billion people to work with will be the deciding factor for demand. America already has its cars and roads and is satisfied, somewhat hesistantly, with its current infrastructure. So world demand for altfuel vehicles will, more than not, be decided by the Chinese and those countries that can start from scratch.
And if India gets its shit together? Whoa, Nelly! Then you’re gonna see a demand war!
With no disprespect to the Chineese, I have to agree with Chris O. I worked for the Japaneese in the ’80s and I witnessed it first hand. It’s more difficult to compete on a level playing field, than it is to dump products, violate patents, ignore counterfitting and manipulate currency.
Although there is no doubt the Chineese will become more influential, they haven’t taken over the world just yet. In order to do that, they will need to be able to compete on a level playing field. Right now, they are copying more technology than they are creating. And, the headwinds of becoming a world super-power become increasingly strong.
With no disprespect to the Chineese, I have to agree with Chris O. I worked for the Japaneese in the ’80s and I witnessed it first hand. It’s more difficult to compete on a level playing field, than it is to dump products, violate patents, ignore counterfitting and manipulate currency.
Although there is no doubt the Chineese will become more influential, they haven’t taken over the world just yet. In order to do that, they will need to be able to compete on a level playing field. Right now, they are copying more technology than they are creating. And, the headwinds of becoming a world super-power become increasingly strong.
With no disprespect to the Chineese, I have to agree with Chris O. I worked for the Japaneese in the ’80s and I witnessed it first hand. It’s more difficult to compete on a level playing field, than it is to dump products, violate patents, ignore counterfitting and manipulate currency.
Although there is no doubt the Chineese will become more influential, they haven’t taken over the world just yet. In order to do that, they will need to be able to compete on a level playing field. Right now, they are copying more technology than they are creating. And, the headwinds of becoming a world super-power become increasingly strong.
Nick: my point was that China seems like a giant with feet of clay to me. On the face of it it has no where to go but up, but if you look beyond the surface a different picture emerges. I would recommend the Goldman Sachs strategy for China: sell it at top dollar to the suckers while going short yourself.
Nick: my point was that China seems like a giant with feet of clay to me. On the face of it it has no where to go but up, but if you look beyond the surface a different picture emerges. I would recommend the Goldman Sachs strategy for China: sell it at top dollar to the suckers while going short yourself.
Nick: my point was that China seems like a giant with feet of clay to me. On the face of it it has no where to go but up, but if you look beyond the surface a different picture emerges. I would recommend the Goldman Sachs strategy for China: sell it at top dollar to the suckers while going short yourself.
California tried to guide the U.S. toward clean car standards. It failed because its leaders were bought off. The Chinese government makes large course corrections based on its national interests. Does it want to be held hostage by the oil producers? No. Does it have the talent to steer toward renewable energy, coal and an electric-based transportation infrastructure? Having lived with Chinese students in college, the answer is yes. Further, they have the capital to buy talent that isn’t home-grown.
Their investments in green technology dwarf ours. That isn’t for show. They’re acting in their self-interests, while American legislators play childish games and we fall further behind.
Green technology will be owned by the Chinese. Then we will have a choice – maybe. Remain dependent on the Middle East or buy renewable technology from the kind folks who hold most of our debt.
Hello Toronto. Got room for one more expat?
California tried to guide the U.S. toward clean car standards. It failed because its leaders were bought off. The Chinese government makes large course corrections based on its national interests. Does it want to be held hostage by the oil producers? No. Does it have the talent to steer toward renewable energy, coal and an electric-based transportation infrastructure? Having lived with Chinese students in college, the answer is yes. Further, they have the capital to buy talent that isn’t home-grown.
Their investments in green technology dwarf ours. That isn’t for show. They’re acting in their self-interests, while American legislators play childish games and we fall further behind.
Green technology will be owned by the Chinese. Then we will have a choice – maybe. Remain dependent on the Middle East or buy renewable technology from the kind folks who hold most of our debt.
Hello Toronto. Got room for one more expat?
I just found this site, and have been working on an EV site of my own for the past 6 months. I have built an EV, and have a pretty good feel for what EVs can and cannot do.
You Sir in my opinion have hit the Chinese nail on its head. It appears that with somewhere around 25 million electric vehicles (mostly e-bikes and e-scooters) that the Chinese are rapidly gaining valuable experience in this field.
Note also that Zap (a California) company is developing taxis for sale in china, GM is all over the country, BMW is planning to market there, and Daimler has recently penned some kind of MOU or partnership agreement with BYD. BYD was sort of pirating Benz technology, but no longer, they are mainstream. The Chery company is just signed a MOU with the US company Better Place to develop switching technology prototypes and charging stations.
Chery last year sold 500,000 units and Better Place is valued at $1.25 USD. These are not small companies, or deals, and the list seems to continuously grow longer.
Like it or not, The US will either cooperate and or compete with China in the EV field, or probably follow as you indicate. It does seem to be a case of lead, follow, or get out of the way.
As for electric power generation, please note that China is also very big into wind and solar power generations. There is a long list of China solar manufacturers for example. I personally use a China brand of solar panel…it is lightweight and performs as well as my US made panels.
It is very likely that the quality of China EVs will steadily improve. I remember about 25 years ago when Made in China tools first hit the Auto stores…they were crap. However, those same tools today are reliable and well priced.
The author’s broad conclusion is correct. Money IS influence and the hard fact is that the Chinese Auto market will be the largest market for as far as the eye can see. In addition, the Chinese are unapologetic about ensuring that if you sell in China, you WILL transfer technology and skills. They are going to be the most influential player in the future of automobiles. Not the sole player, but definitely the most important.
The author’s broad conclusion is correct. Money IS influence and the hard fact is that the Chinese Auto market will be the largest market for as far as the eye can see. In addition, the Chinese are unapologetic about ensuring that if you sell in China, you WILL transfer technology and skills. They are going to be the most influential player in the future of automobiles. Not the sole player, but definitely the most important.