If the world is going to have electric cars in a big way — and a lot of people believe this is so — a fair bet will be that China will be the leader. Berkshire Hathaway — think Warren Buffett — bought 10% of BYD for $230 million and Berskhire Hathaway tends not to get it wrong.
Now we have columnist Avner Handelman saying that you can bet on China to produce world-changing electric car
He carefully defines his view of the electric car:
‘I’m not talking hybrids here. I am talking a pure electric that runs on batteries, travels 200 kilometres on one charge, drives fast, consumes electricity equivalent to the cost of a gasoline engine getting 240 mpg, needs a one-hour charge for each travel hour – yet costs less than $25,000 and can be fixed by the local electrician and bicycle repairman.
‘Such a car, if it existed, would change the world.’
That car will come from BYD which was found by Wang Chuanfu and is expert not on cars but on batteries. Most of the current American bunch — there are three of four — are written off as either being pipe dreams or too expensive to buy and run.
He lists the three common problems of most Western electric cars: the need for a cheap battery that lasts; the need to produce lots of cars; and the need for a big company to back it all up.
He writes: ‘To make an inexpensive battery ($10,000, say), you need really cheap lithium deposits, billions of dollars for a huge production line of Model T-like proportions, and super know-how. In all these the West is deficient.
‘Yes, lithium is everywhere, but the cheapest deposits are in Australia (small), Chile (okay), and Tibet – best and large, and controlled by China. As for billions of dollars needed for a production line, China is among the world leaders in batteries. (BYD is also the world’s biggest maker of cellphone batteries.)’
He suggests, on admittedly very sparse evidence, that :’one day we might see a big production line of lithium batteries close to Tibet, to power all those BYD electric cars. (Incidentally, could electric motor production be why China has been buying copper massively?)’
His final reasoning is that the West simply does not want to devalue the worth of its petrol cars which will lead to huge job displacements and problem with the dealerships. You, like me, may find this part of the argument hard to follow.
In his article in the Globe and Mail he argues further: ‘Cars could use electricity, so repair and spare parts would be a smaller business (aside from battery handling — lithium can be tricky stuff), so more of the manufacturing base could move offshore. And the car you’d be driving 10 years hence would likely be Chinese, with BYD nearly as big as Toyota.’
What he misses is that these cars can only do 60 mph, are very small and light and thus a bit scary in accidents and need a long charge every 100 miles or so. As they stand they will not replace the petrol car in a big way.
With a lot of improvements — bigger, cheaper, batteries – they might have a chance. But not yet. Not in the United States. In China, yes. They suit the traffic flow. In North America they do not.