China pushes for greener vehicles through subsidies

vtg_1.jpgAuto components supplier Honeywell (famous for Garrett turbos) have signed an MoU with ChangAn Automotive for the two companies to jointly develop micro-turbochargers. Honeywell’s definition of micro-turbochargers are small turbochargers designed for use with two-cylinder or three-cylinder engines, especially diesel engines, designed to make those engines more driveable when installed in low cost and fuel efficient compact cars.

The Chinese government have called for car manufacturers to produce more energy-efficent vehicles and equipping cars with downsized force inducted engines are one way to increase a car’s efficiency. China has recently announced a government subsidy scheme where the government will subsidise up to 50,000 yuan (RM25.8k) for hybrid cars and up to 60,000 yuan (RM31k) for electric cars.

There are currently only 5 vehicles on this list with more being evaluated and added soon – the IVECO electric service vehicle, JAC’s electricity engineering electric vehicle for city electricity system maintenance and repairing, Zotye’s electric light bus, BYD’s F3DM hybrid car and JMC Transit’s electric service vehicle. 4 out of 5 are commercial vehicles, and with the huge manufacturing/industrial sectors in China perhaps its for the best that these vehicles get plenty of attention.

BYD F3DM

BYD is really quite happy about this as they’re the only consumer passenger sedan that qualifies for the subsidy so far. BYD confirms that their F3DM qualifies for the full 50,000 yuan subsidy, and the car will officially go on sale beginning September. The F3DM is a plug-in hybrid which means that even though it is a hybrid, it can be recharged through a wall plug, thus you may never really need to start up its combustion engine if you use it for short trips.

BYD is becoming a big brand when it comes to green tech in China. It recently won a contract to supply fellow chinese automaker SAIC with lithium ion batteries. Its li-ion batteries are based on iron phosphate and are self-developed. BYD claims they can be recharged over 2,000 times and have an estimated lifespan of over 600,000km. Warren Buffet should definitely be happy about all of this – analysts estimate his Berkshire Hathaway’s investment in BYD has already made 430% in just under a year.

In Malaysia all that we have to encourage more efficient vehicles are the prospect of saving on road tax costs and a temporary rebate on hybrid vehicles under 2.0 litres in displacement. When the new NAP review is announced by the end of September this year, we will see if there is anything regarding green technology. There are currently only two hybrid cars on sale in Malaysia through official channels – the Honda Civic Hybrid and the Toyota Prius.

Most of you will be waiting for any indication of lower car prices but while MITI says import duties for ASEAN countries would be removed from January 1st 2010, it has hinted that we could potentially not see any kind of reduction in car prices that can make an impact in our buying experiences as vehicle prices are “subject to market forces which are influenced by factors such as the price of local and imported (CKD) components, forex, transportation cost, insurance and interest rates.”

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Paul Tan

After dabbling for years in the IT industry, Paul Tan initially began this site as a general blog covering various topics of personal interest. With an increasing number of readers paying rapt attention to the motoring stories, one thing led to another and the rest, as they say, is history.

 

Comments

  • Analyzer on Aug 21, 2009 at 10:20 am

    Even China is pushing for green vehicles. I wonder when would our government follow suit.

    BTW, is that a Corolla Altis rip off?

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  • Gajen on Aug 21, 2009 at 10:28 am

    'altis'! lol….wonder when will they stop copying

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  • Elvis on Aug 21, 2009 at 10:57 am

    BYD already making inroad in China due to strong government support. Wont be surprise BYD also will be the biggest EV manufacturer in years to come. I think China is very eager to see itself as leader in EV considering the air pollution in China and benefit of EV to its air quality. I think we may laugh now about BYD rippoff body design but the engine technology is very much original China. Fortunately, China is not under influence of big oil companies unlike the US or European or even our very own Malaysia.

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  • azrai on Aug 21, 2009 at 3:44 pm

    Even China without NEP can come out with this sort of things. Pity malaysian. Already 25 years in automobile industry using rakyat's money. Those “subject to market forces which are influenced by factors such as the price of local and imported (CKD) components, forex, transportation cost, insurance and interest rates.” quotes make one word in my mind. BULLSHIT!

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  • taboogen on Aug 21, 2009 at 3:46 pm

    when malaysia gonna follow… ayokk change the attitude first then we can changed. Smocking while driving then just throw the ciggerate on the road also not green isnt it. Start with yourself then we can take up with G

    meng pai

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  • Littlefire on Aug 21, 2009 at 3:50 pm

    While MITI says import duties for ASEAN countries would be removed from January 1st 2010, it has hinted that we could potentially not see any kind of reduction in car prices that can make an impact in our buying experiences as vehicle prices are “subject to market forces which are influenced by factors such as the price of local and imported (CKD) components, forex, transportation cost, insurance and interest rates.”

    This is bullshit excuse, they have no sincere on lowering down the car in protection for P1… I wonder that AP will not be abolish also… Last time mention will be abolish by 2010, i bet that when the time come either it is not abolish or change into another version of AP… "Twist n Turn" all the time and never implement properly, i hope that other Asean country will boikot us again, like Thailand did last time…

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  • normal_user on Aug 21, 2009 at 4:08 pm

    Our government is so light years away when it comes to promoting the use of green vehicles. Even the Prius & Civic Hybrid are not given the sufficient amout of incentives. The G should totally provide full tax exemption for these cars. They come with a hefty price tag in the first place, so 50% tax cut is not enough.

    Any indication that the JV between Proton & Detroit Electric went smoothly?

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  • azrai on Aug 21, 2009 at 5:12 pm

    Paul, is there any news on 1.5 lancer sportsback? The entry level of lancer.

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  • Wilfred on Aug 21, 2009 at 5:51 pm

    how the subsidy works?

    is it a kind of tax rebate too, or it is truly the car price without tax(import tax, or sort of like excise duty) plus the subsidy?

    Man, truly disappointed with BeEnd at total…

    I wish they get overturn now….none of their policies favor Rakyat nowaday…jz gimmick

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  • I must say probably proton may able to produce a greener vehicle, but i was so doubt about the quality as we seen the major issue occurred in many of previous models. i currently drive a proton too, is wira, a very old model car without any updated/ basic safety equipment . I've facing a serious road accident last 2 years ago, and i've broke my right Lang while my chest hit the steering. This is a terrible exp to me, and i was wonder maybe i can safe if i drive a car with a airbag. I was so pity the all the Malaysian that drive a outdated & pool quality car and also those ppl buying a high tax expensive car which pay for the goverment~ which is my next car? Definately not a Proton!!

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  • kinesthe on Aug 21, 2009 at 5:59 pm

    yeah… those silly chinese. copying the design of the last generation corolla. and trying to put in all of this "new fangled technology" lithium battery mated with engine design of mr mysterypoopypants. those silly chinese when will they ever learn.

    they should establish one company to develop existing tech cars, only crappier, as other carmakers explore new markets because the old one is facing sustainability issues. then they should also set up a few other companies to fork out money to foreign firms to buy random pre-made existing-tech cars to be sold as rebadges. that's the *real* way forward.

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  • scanzew on Aug 21, 2009 at 6:22 pm

    hehe….BYD…2000cycles divide with 365times with approximate charge every single day…that will be 5.4years…..and maybe single charge every 2 days….it's will be 10 years or more…interesting!!!

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  • intermilan on Aug 21, 2009 at 7:10 pm

    Agreed with what Littlefire said.

    No one is looking forward to the NAP revision, positively. except the widely known beneficiaries.. P1, P2 and perhaps, the Japanese car manufacturers.

    It will just be full of vague, weak points that is unattractive and certainly bias to certain manufacturers and 'green' tech. Attracting more foreign investor? I think the G already surrenders it to the Thais long time ago.

    Wanted to grab the hybrid / electric car segment? Thailand is in the better position to grab this segment (as they now have the right base in automotive production etc etc). Beside M'sia, let alone ASEAN are NOT READY to embrace electric car in 5-7 years. Not with current reality. Too much need to be change and implement. Just look how reluctant / difficult it is to upgrade the fuels standard….For me, trying to position out nation as electric / hybrid car manufacturing hub is a noble idea but the push for it seem to forgot that Thailand can also do the same, much much more easier. I think Toyota announcement regarding manufacturing hybrid Camry in Thailand is an indication that Thailand would have it easy if they want to be hybrid / electric vehicle manufacturing hub. Of course, M'sia still need to do something to attract FDI in auto sector while building its own industry (since the G are so grip with it) but ignoring the voice of the people (we want cheaper car!) while at it is most regrettable and puzzling.

    Regarding car price, the soon-to-be revised NAP surely will not make it cheaper, especially CBU from non-ASEAN. CBU from ASEAN also will not be spared. Yes, 'twist and turn'… Protection of the 'local players' is the outmost important agenda of this NAP revision. Not 'opening up' or levelling the playing field. The G view is always the same like in Tun M time; they are doing this (protection / trade barrier in auto industry) in order to level the playing field. With out it, local manufacturers are going to be wash away.

    So, P1 & P2 will continue to enjoy whatever they are enjoying right now with further goodies surely to be embedded in (both for now and for future – as safety net). If they need to remove some goodies, they will replace it with something else of equal value (at least).

    Mature fuel-efficient tech such as turbo diesel will not get anything in this NAP revision. The implementation of 'only' Euro 2 (or Euro 2M as they called it here) diesel is the knockout blow. I dont even know why, in the name of God, did the Govt upgrade our fuels to Euro 2 standard in the first place. Just cannot see the benefits in terms of it allowing the introduction of new cleaner diesel vehicle. Fact is, most if not all excellent turbo diesel engine nowadays need minimum Euro 3 to work its charm. See the correlation (or rather lack of it?) Heck, the European regulatory body are going to enforce the Euro5 (or ULSD in Japan) in the near future!

    Perhaps the Govt just target to lower sulphur-induced pollution? Why r G so caring about that until they took such a big hassle? Things just dont add up here. Beside, the Euro emission standard is always about the reduction of CO2, NOx emission (and a few other pollutants). Sulphur is given. They implement the Euro emission standard as part of initiative to achieve the target set in the Kyoto Protocol and tied it with car tax etc in order to make sense of the emission standard implementation (beside the obvious fuel saving behaviour of these vehicles).

    Since our legislative/regulatory on cleaner fuels (actually, is there's any?) will always lag the European by at least 2 or 3 Euro standard, it is quite 'accidental' that M'sia clean fuel (petrol n diesel) roadmap has been layout to miss the movement of the European emission standard implementation. Therefore, it will always be impossible to bring in the 'current' fuel-efficient vehicles from EU (e.g. turbo diesel vehicle) into this country. To bring in 'old' turbo diesel from Europe factory (as CBU or CKD) is out of the question, as production of such vehicles had been stopped. Beside there is no economy of scale and existence of various constraints.

    As late as 2007, it was reported (by AIP) that M'sia had committed to implement Euro 2 fuels (petrol n diesel) by January 2006? … and then jump straight to Euro4 by 2010+ ? (actual year not committed)

    BTW, most oil refinery in Malaysia and outside (where we r getting our imported fuels from) are able to produce Euro4 fuels. Its a little more expensive they say, but aren't everything nowadays?

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  • shoryuken on Aug 21, 2009 at 8:24 pm

    Green engine means less petrol, means less revenue for Petronas, means less $$ for the G. Why they want to support this so call Green movement? Even shutdown 1 hr in the Earth day says TNB lost xxx amount of $$. Crazy. They benefit from this closed economy for the car industry since Msian is keep buying cars no matter what ufair rules that is implemented. It is the consumer that cause the G to implement such rule. Consumer can choose not to buy if not happy.

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  • I'm so jeolous people in thailand..even 'org kampung' in thailand can buy Hilux and many good car..

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  • fadzly on Aug 21, 2009 at 11:02 pm

    Ya Ya. As Usual, Rakyat Money la, When will G enforce this la, 25 years still no change la, bla bla bla.. mindset of 'rakyat' people still di takuk lama…

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  • pity Eric.

    still in dinosaur years..

    .

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  • motoring topic now becomes politics & economy talks…shhh shhh…

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  • badboy on Aug 21, 2009 at 11:23 pm

    kinesthe said,

    August 21, 2009 @ 9:59 am

    yeah… those silly chinese. copying the design of the last generation corolla. and trying to put in all of this “new fangled technology” lithium battery mated with engine design of mr mysterypoopypants. those silly chinese when will they ever learn.

    they should establish one company to develop existing tech cars, only crappier, as other carmakers explore new markets because the old one is facing sustainability issues. then they should also set up a few other companies to fork out money to foreign firms to buy random pre-made existing-tech cars to be sold as rebadges. that’s the *real* way forward.

    —————————————————————-

    And I tot u are talking about Proton

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  • Good one intermilan – The NAP is just some show of fireworks for us to see with no benefits to the rakyat at all. Green tech, fuel quality, CBU/CKD reduction in tax…they often like to lower one of their taxes and hike another

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  • ericfoong81exe on Aug 22, 2009 at 1:46 am

    The BYD has it's own big factory in China that manufacturing from bolt nut to tyre for entire car by it self. No doubtly there are copying the technology and out look from Japanese and European car all this while. Do not under estimate the China motoring industry developement power even though this BYD F3 model significantly copying the front Toyota Altis and Honda City for the back. They are evolving with 5 times faster than Malaysia in terms of car manufacturing technology.

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  • valandil on Aug 22, 2009 at 2:00 am

    If want to 'promote' a green engine (with a car), shouldn't it be better/ effective if the back ground be of a nicer scenery, eg. lush green forest and clear blue sky?

    the rims looks cheap and low quality rip offs.also not slip efficient.

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  • bobdbilder on Aug 22, 2009 at 3:18 am

    Ek eleh kau ingat refinery tu banyak untung ke? Jual harga dah price controlled. Kau ingat boleh untung sangat ke. Tu Merapoh Resources don't know what theya are getting themselves into. Kalau tak tau jangan cakap. Orang Oil and Gas ketawakan aje beb.

    Wei…if our diesel is sooo bad why can all those Scania, Volvo trucks Kia Preggio and Hyundai Starex is not emitting high volumes of smokes? Face it, our trucks are maintained unprofessionally. I used to deal a lot of diesel engines at the Shipyard. If you do it right and regularly, you wouldn't have the gook coming out. Fact is, its more expensive to maintain a Merc diesel than a Korean diesel ainit?

    Its hard aready to pay the pump price now, you and your singletracked industry specific buddies are selfish and do not want to look at the whole picture. Its the economy dum#@$$!

    Memang cakap main lepas aje. Inti takde. Ni belajar kat mana ni?

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  • altimate on Aug 22, 2009 at 4:13 am

    great initiative by chinese govt. and I think they realise the positive effect that it can bring to them, as the magnitude of change is much higher. Imagine number of cars on their roads, even if 30% of those are hybrid, we can imagine the reduction of CO2 emission. Everyone is responsible in reducing the pollution to this planet. China goverment is doing their part by stimulating their auto industry towards this direction. Malaysian govt is not doing that.. YET !.

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  • fadzly on Aug 22, 2009 at 6:02 am

    bob the builder

    can we fix it?

    bob the builder

    yes we can~

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  • aiyaa u malaysian.. know only complain n complain. the G made up of u also, and me also and us also. majority of us select that G to be up there mah.. then majority of us also bought those high tax car mahhh.. so much so that toyota, honda, nissan made lots of profit, the G also made lots of from tax.. even grey importer also made profits, bank made profits, car wash made profit, parking operator made profits… brothers also made profit. y need to change if everybody made money??..

    to change then make no one make money, then things will change automatically.. even the G also can changed if no one make money. so start today by not buying any new car. get your family, friends, neighbor not to buy any car. if u found only u without new car while rest driving brand new local or other makes, then only u laa who dont make money!

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  • Littlefire on Aug 22, 2009 at 5:26 pm

    The G is smart, they purposely make the public transportation sucks, so we have to buy our own to drive to work. Who have went to Singapore and take the MRT and compare it to our KL LRT?!?

    Even the road condition and other user attitude are so dangerous that a lot of ppl have to spend more money in a better safety, performance, fuel economy car compare to others… Am i right?

    Have you wonder if all of us drive wira and knock each other? If i drive even an old nissan sunny 130y, which car is better in term of fuel economy and safety compare to wira 1.3L? So now know the reason why other ppl are forced to buy better cars…

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  • bmpower on Aug 23, 2009 at 1:06 am

    nissan sunny 130y is ugly than wira 1.3 btw.

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  • Littlefire on Aug 23, 2009 at 6:14 pm

    Sunny 130y is ugly, but in term of safety n fuel consuption which 1 better? Why not let both the cars knock togather and see which 1 better? I would rather sit in the 130y…

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