How China Put The Big 3 And The U.S. Behind The 8 Ball With EVs - CleanTechnica

If you look at the Bolt EUV, you might just think it’s a modified Bolt EV. To some extent this is true, but that’s nowhere near the whole story. The original Bolt EV came from GM’s Korea division, which in turn grew out of Daewoo, a Korean company GM purchased years earlier.

But, after the success of the Bolt EV, the platform was further developed in China to satisfy the appetite for EVs there. An improved design that found success there (the Chevrolet Menlo) became the Bolt EUV and is now sold in the United States. The EUV’s platform is going to be the basis of the next affordable Bolt, which is increasingly becoming vital to GM’s future. Foundation Bolt Design

How China Put The Big 3 And The U.S. Behind The 8 Ball With EVs - CleanTechnica

Some readers who didn’t know that the Bolt EUV and its vital future descendants has Korean and Chinese roots are probably wondering why American automotive companies have gotten to this point. The sad fact is that the Chinese EV market managed to gain a years-long head start, and the design work ends up following the money, and it’s going to take years for American-designed platforms to become dominant again (assuming they ever do).

A recent video I came across on YouTube shows us not only how this happened, but why. People working in and out of the industry need to understand what happened, because if we don’t, the whole industry will be under Chinese control and influence for decades to come (article continues after video).

The story starts with the Changan Eado, an electric car that looks like a failure on the surface. Hundreds of them are sitting abandoned now. But, the effort lead to not only the growth of the Chinese automotive industry, but becoming a leader in EVs globally. Not only are ideas like the Bolt EUV’s platform dominating, but made in China vehicles are also increasingly dominating the field (especially outside of the United States). Even Tesla has become a Chinese exporter.

It goes further back to China’s oil problem. Even as late as 2000, micromobility (whether pedal-powered or powered by small gasoline engines) dominated. But, in just a few years, car ownership exploded. Eventually, the ruling party decided they didn’t want the country to look poor with all the bikes and motorcycles, so the leadership pushed even more people into cars (a move that they’re now trying to reverse).

Unlike the United States, China doesn’t produce much oil or have much in the way of oil reserves to tap. So, when the United States used 20% of the world’s oil and China used 13% of it, the Chinese situation was a lot more precarious. Being heavily dependent on oil imports leaves a lot of political power outside of the country, and could even leave China vulnerable to blockades in the event of a major war.

The other problem was pollution. We’ve seen images over the years of nasty air quality in the country. The ruling party doesn’t take orders from its people the way that western governments do, but if things get too bad for too long, even the more centralized authoritarian power arrangement could become imperiled. Plus, the wealthy elites live in these megacities and have to breathe the same air. Add to that the optics problem, and China was losing a lot of face on the world stage.

For all of these reasons, something had to be done, and China’s political leadership (like them or not) had the will do do it without the limitations of a more free market. The relative simplicity of EVs was also a lot more compatible with the existing Chinese economy’s strengths. By adding on lots and lots of subsidies, letting people buy EVs outside of the license plate lottery system, and having government entities themselves buy lots of EVs, EVs really took off.

This wasn’t without challenges, though. Regional rivalries, market saturation, and highly competitive pricing has made it challenging for companies to succeed. So, the party had to deregulate the market and cut back on subsidies to let the best companies succeed. The government also lit a fire under Chinese automakers’ butts by letting Tesla enter the market without a JV partner. This has helped the industry become a lot more healthy (after a pain period).

Now, around 40% of Chinese auto sales are electric, and like the U.S. auto market, one company broadly dominates: BYD. This then led to Chinese cars becoming export items, which in turn leaves the rest of the world dependent on China for battery minerals.

Now, U.S. domestic automakers and those in allied countries are in the hot seat. Policies that only allow subsidies for electric vehicles with supply chains extending into friendly countries are there to protect the Big 3 and even German and Japanese automakers from the onslaught of cheaper Chinese cars. More importantly, the goal is now to keep US transportation and energy from being too dependent on Chinese minerals.

In other words, the problem China had with oil is now faced by the United States and allies in different ways.

Another factor outside of public policy supporting EVs is that Chinese buyers are a lot less picky about range. United States buyers often want 500 miles of range (even if it’s an excuse), while Chinese buyers don’t feel the need for even half that. Why? Because in a country with abundant public transportation options, the need for road tripping seems a lot lower. The number of EV buyers buying their first car ever also keeps expectations for range low, because they never lived in ICE land and don’t make such comparisons.

Another issue is that the United States didn’t have much of a battery industry to begin with. The vast consumer electronics industry was there and party officials only had to subsidize them to get them to grow faster. It didn’t take that long for EV battery packs to be more widely available. United States battery companies just weren’t there to begin with, and we’re having to start them from scratch.

On the other hand, I can’t agree with the negative end of the video. The Biden Administration may be trying to have it both ways (more EVs, less China), but at the same time, the strategic situation leaves the administration with little choice but to slow EVs down a bit to keep them from becoming a Chinese beachhead. With the serious possibility of warfare in the future, a president cannot favor environmentalism at the cost of enabling global authoritarianism.

Featured image by GM China.

Jennifer Sensiba is a long time efficient vehicle enthusiast, writer, and photographer. She grew up around a transmission shop, and has been experimenting with vehicle efficiency since she was 16 and drove a Pontiac Fiero. She likes to get off the beaten path in her "Bolt EAV" and any other EVs she can get behind the wheel or handlebars of with her wife and kids. You can find her on Twitter here, Facebook here, and YouTube here.

Jennifer Sensiba has 1848 posts and counting. See all posts by Jennifer Sensiba

The video highlights a LOT of the critical mass points that others refuse to put together and preset the simple facts. I’m sure if the site was working properly, this would have gotten much comments, but maybe that’s a good thing because I could see it turn into a mess.

The Great Irony ! GM,Ford, VW and others who have been in China and even partnered up with Domestic EV makers never learned the “Free Lessons” they could have taken away to apply that know how to their own domestic operations. As the video mentions this Ohhh so politely. YET, when GM-SAIC or GM-Baojun produce high demand EV’s in China that would sell Really Well in North America & Beyond they pull a 3 Monkeys and tell everyone “it is good”. I remember when the Buick Menlo (the EUV talked about) was for China Only and people were clamoring to get it to North America…

I think you are over discounting the FFI which is still VERY MUCH in play today.

A clarification. The article & Video mention how US Customers want “500 Mile Range” which is 804 Kilometers. There are only a HANDFUL of ICE’s with that range and guess what, 1/2 are Hybrids ! Guess what else, NONE of them are Trucks or SUV’s !

Remember, EV ranges are given for optimal conditions. If I’m driving >=75mph, that about* halves the range. If I’m driving in below-freezing temperatures that also about* halves the range. So that’s about* a 125 mile (200km) range in the worst case. A number of years ago I once drove overnight, in winter, to a funeral in another state, so I know it’s not an unlikely case.

* I know the range reduction is less than half. If you know a better estimate that’s easy to calculate, please popularize it.

The EV range issue has never been winnable. I recall the earliest days of EVe when supposedly consumers needed 100 miles of range for acceptability. When EVs finally exceeded that, it became 200 miles, then 300 miles.

If 500 mile EV ranges ever become common, we’ll hear that 800 miles is the new target.

That’s a deception explanation. When they first started they were looked at as local not road trip (Walk before you run). As their capability became more main stream oriented, the use possibilities began to take on longer destinations. That’s why the number increased. And until there are many, many more DC fast charge that actually put out FAST, the extra range capability is beneficial.

You can not compare the EV to ICE situation when trying to equate the full functionality based on the range numbers alone. First, there is a gas station on “every corner”. Second, to pump liquid into a bucket is far, far faster than charging at DC fast charge. It is a simple fact of the energy dynamics. When you add gas to a car you are adding a fuel that then OVER TIME (Use) converts that fuel to energy. With an EV, you are actually adding the energy, NOT A FUEL, and that is why the difference in time. SO the 500 is needed because of these two variables.

All dominance is only temporary.

We should recall that in the golden years of American hegemony, the US auto industry still did not export a lot of cars. Then as now, Americans have radically different purchasing patterns than anyone else. It was the wealth generated by the internal US car market that made GM and Chrysler temporarily rich enough to buy up foreign brands that continued to make cars. (Ford was the one that started its own subsidiaries from scratch overseas, but they still made their own distinct cars.) And now this American empire overseas has largely collapsed. When push came to shove, they all sold or closed foreign divisions to save resources for the US market. Because bigger cars sell for bigger profit margins and Americans are all about bigger.

What matters is that this empire did not give Yankees dominance over global automaking. Japan got that dominance because it had to expand beyond its overcrowded low-margin home market and learn what foreigners want. Now even Japan’s auto empire is under question. There is nothing China is doing that cannot be countered by non-Chinese capital bothering to diversify supply chains. A myth is being spread that using Chinese battery tech in the short run will make us eternal Communist slaves somehow.

The problem is simply that Western capital is too busy chasing quick kills and subsidies to invest in the actions needed to close things like the battery gap. The solution should be to ban further investment in industries that accelerate climate change. There are any number of countries that have untapped mineral resources and industrial potential to make the batteries. There are many Vietnams and Mexicos out there waiting to emerge.

How China Put The Big 3 And The U.S. Behind The 8 Ball With EVs - CleanTechnica

Nylon nut Part of the problem is focusing on short term quarterly profit vs long term profit.