Chinese carmaker BYD fares well in hometown, struggles elsewhere

(From Caixin Online)

Maker of electric cars succeeds in Shenzhen, but stumbles in Hong Kong and other markets

By staff reporters Yang Yanwen, Lu Xiaoxi and An Limin

BYD Auto Co. has seen its electric-powered models gain acceptance by the public transportation system in its hometown of Shenzhen, largely due to the support of city authorities, but the carmaker has encountered bumps in the road across the border in Hong Kong.

Workers in Shenzhen BYD factory

Workers in Shenzhen BYD factory

BYD e-taxis hit the roads of Shenzhen in 2010, when the city’s first electric taxi firm, Pengcheng Electric Taxi Co., was formed. In 2013, Pengcheng, a joint venture between state-owned Shenzhen Bus Group and privately held BYD, reported a profit of 12 million yuan. As of 2014, 850 BYD electric taxis were operating in Shenzhen.

As China’s largest maker of electric cars in term of sales and the main taxi supplier for Shenzhen, BYD’s prospect in the southern city seem set for more success because the city government is ambitious to expand use of electric cars.

In early 2015, Shenzhen’s transportation department said that by the end of the year the city would have more than 4,500 electric taxis. To encourage cab drivers to replace their traditional vehicles with electric models, the city’s government announced it would offer subsidies of up to 130,000 yuan to drivers who bought electric cars.

Cai Yu, deputy director of Shenzhen’s economic planning body, said in January that drivers of electric taxis and their companies will be exempt from license plate fees for five years and also benefit from other preferential policies. Cai said that the government wanted nearly three-quarters of Shenzhen’s 16,000 taxis to be of the electric variety within the next five years.

Yet BYD has had less success in neighboring Hong Kong. In 2013, when BYD leased its first batch of 48 electric taxis to the former British colony, Wang Chuanfu, its chairman, said that “Hong Kong is the most suitable place in the world for electric vehicles,” due to its small urban area, dense population and well-developed public transportation network.

BYD leased the vehicles to two local taxi company associations, the Hong Kong Taxi & PLB Association and the N.W. Area Taxi Drivers and Operators Association, for two years. At the time, the company said it hoped to increase the number to 3,000 in two years.

However, Chen Zhou, chairman of the Hong Kong Taxi & PLB Association, said last year that 45 of the taxis have been returned to BYD. In a January interview with Caixin, BYD’s Wang attributed the disappointing result to the “absence of policies to promote electric taxis.” Read more


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