China sells around 29 million vehicles per year.
On 18 October 2018, Mr. CAI Qi, Member of the Politburo of the Central Committee of CPC and Secretary of Beijing Municipal Committee of CPC, opened the World Intelligent Connected Vehicles (WICV) Conference in Beijing.
Following a welcome speech by Mr. MIAO Wei, Minister of Ministry of Industry and Information Technology of the People’s Republic of China, WICV kicked-off with a keynote by Mr. WAN Gang, Vice Chairman of CPCC and Chairman of China Association of Science and Technology.
The message is clear. The automotive industry is one of China’s key industries and highly focused on four developments, namely 1) electrification 2) intelligence 3) autonomous and 4) sharing.
For three years I have been actively involved within the automotive industry in China, specifically interested in the field of Smart & Green Mobility. Via this post I hope to provide you with some of my insights, based on the WICV Conference as well as related information I learned during my stay in Shanghai.
“Opening a new era of vehicles” – slogan of WICV 2018
1. Electrification is a global movement. One which – in my view - is specifically beneficial to China for a couple of reasons.
The traditional combustion engine vehicle is being dominated by big players in countries such as Germany, France and Japan. It seems almost impossible for China to keep up with the technical advancements within these countries and win a spot in the global market. Electrical vehicles however, is kinda “new” to all players in the world. With battery technology being developed in Asia, it’s seems a very logic decision for China to stimulate this movement. Other explanations of the central government’s devotion towards New Energy Vehicles (NEVs), is the fight against air pollution and the growing dependence on imported oil.
China does so in various ways; the government pushes Chinese OEM’s to produce a minimum number of electric vehicles, while at the same time pulling the market by providing many benefits to consumers buying an electric vehicle (such differs by province and/ or city, f.e. electric vehicle buyers do not need to join the bidding system for a license plate or they get the license plate for free – which can costs around 10.000 EUROS for combustion engine vehicles).
The biggest share of NEVs in China are full-electric vehicles (BEV). It also opened the market to new car brands such as NextEV (NIO).
Electric vehicles are being perceived as the best bearers for intelligent connected vehicles (ICVs), bringing us to the next movement; intelligence.
2. Intelligence is a movement within the automotive industry in which we encounter a new type of company active. Aside from OEMs, the industry opened up for many ICT related companies. In China this includes Internet giants Baidu, Alibaba and Tencent (BAT companies) – all present at WICV. Baidu created an “AI” platform for the automotive industry called Apollo, involving 129 companies. Alibaba started a cooperation with SAIC 3 years ago and highlights at WICV the importance that Internet and connectivity are two separate things. Mr. Pony MA, Tencent’s Co-Founder, CEO and Chairman of the Board, spoke about the data industry involving around ICVs including platforms and computer brains.
I think it’s specifically interesting to see the tension between traditional OEMs and new-comers. It is clear car manufacturers need new expertise and more technologies to design the intelligence of their cars. In other words, their interest in intelligence creates a dependency towards ICT companies. On the other side, these companies also form a threat. The involvement of many players in platforms such as Apollo (by Baidu) show the importance of being involved and not left behind.
From intelligent vehicles we move to autonomous driving.
3. Autonomous driving is a development often discussed. Mr. WAN Gang focused during his keynote on the integration of X2V and V2X, while elaborating on the need for more and better mapping technology.
China is actively stimulating autonomous driving, f.e. via testing areas around the country. Personally, I am most informed about a testing facility in Shanghai and will therefore highlight this project. The testing facility is named “A Nice City”, referring to the National Intelligent Connected Vehicle (Shanghai) Pilot Zone. A Nice City is being built in Jiading, the automotive region of Shanghai. It started with an enclosed testing zone of around 15 kilometers and up to 100 scenarios (F-zone), while aiming for an intercity comprehensive transportation corridor of 500 kilometers by 2020. Recently China also started with open road testing.
A Nice City is organized and coordinated by the Shanghai International Automobile City (SIAC). SIAC is responsible for the automotive industry in and around Shanghai, and performs a big variety of projects. Aside A Nice City, they run f.e. the Innovation Park, China’s first specialized park focusing on automobile innovation ecology, and set up a cross-field and open ICV United Innovation Center (UIC).
Another initiative of SIAC is EVCARD, which brings us to the next topic.
4. Sharing is a trend which China got to know via bike sharing (well-known examples are Mobike and OFO). In general we see a trend that the young generation is less interested in owning his or her own car. Following examples abroad, EVCARD is the first (minute-based) electric vehicle leasing brand in China. EVCARD started in 2015 with the establishment of 300 time-sharing leasing points and 1,000 vehicles in operation. Goal is to achieve 6,000 leasing points in Shanghai by 2020, involving 16,000 vehicles in operation. Customers can hire and return the cars via a mobile APP.
My wish (probably not in line with the car manufactures) is that this sharing principle will drastically lower the number of cars in China. In cities such as Beijing, Shanghai and Shenzhen, public transportation is often a much better alternative.
Related to all four developments, there is a wide variety of Chinese companies active. Mr. WAN Gang showed an overview at WICV, which hopefully gives you an idea of the ecosystem present in China.
Translation of the categories:
· 芯片= (AI) computer chip
· 传感器= sensor; transducer
· 地图定位= mapping/ location
· ADAS = Advanced Driver Assistance Systems
· 自动驾驶= autonomous driving
· 操作系统= operating system
· 整车制造= full car manufacturer. Note: every province in China has its own OEM.
· 通信设备＝communication equipment
· 通信服务= communication services
Aside for the companies mentioned on this slide, there are many more.
Our Embassy in Beijing recently published a report about New Energy Vehicles in China. We also have other types of information, contacts and overviews about related events. If interested, please feel free to reach out.
Currently we are writing a report on Hydrogen Developments in China, including fuel cell vehicles. Might you have relevant information and/or want to keep up to date, I also welcome you to contact me.
Anouk van der Steen
Attache for Innovation, Technology and Science in Taiwan
Published on Linkedin • 2018