Riding towards a better future with e-car plan

China Plus Published: 2017-10-03 10:33:22
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By: Hassan Arshad Chattha

By committing to ceasing production of conventional combustion engine vehicles in the near future, China has set the stage for progressive disruption across the tech, automotive and energy industries. 

In early September, China announced that it will set a deadline in the near future for a halt in production of carbon fuel consumption based vehicles in favor of electric and renewable energy based vehicles. 

By being one of the largest energy consumers and producers of the world, as well as one with access to massive amounts of cheap coal, China has set a bold precedent for the other nations to follow by giving such critical importance to renewable energy. 

China's Chang'an electric car is displayed at 2015 Shanghai International Automobile Industry Exhibition in Shanghai, China, April 22, 2015.[Photo: Xinhua]

China's Chang'an electric car is displayed at 2015 Shanghai International Automobile Industry Exhibition in Shanghai, China, April 22, 2015.[Photo: Xinhua]

To get a better perspective of the scale and ramifications of this decision, it is important to understand China’s impact on the automotive market. China is the world’s largest automotive manufacturing and sales base with 28 million vehicles produced overall in 2016. According to the IOMV (International Organization of Motor Vehicles), this accounts for nearly 30% of the worlds total of 94 million vehicles sold. 

The most important outcome is the hope for containment of rampant climate change which is leading up to devastating effects on global climate in the form of global warming, over powering storms, sweltering heat and toxicity of the air we breathe. The rise of renewable energy will greatly assist in curbing cataclysmic climate change and help alleviate some of the future causes of violent and endless conflict over depleting resources on a dying planet. The adoption of such policies by China will also encourage other nations to follow suit, both by inspiration as well as experience and technology sharing with China.

As a timeline, China, the UK and France have marked some time around 2040 as the targeted deadline when they can effectively halt all production of fossil fuel powered combustion engines. The true impact comes from China’s decision to do the same. This monumental decision will have long lasting impacts on the development trend of human civilization and Chinese progress in the near and distant future.

Beyond the obvious impact on climate change and pollution, there are a couple of other quite interesting outcomes. The first is, it gives Chinese manufacturers an incredible advantage in the coming future in key areas. There are many products that began manufacturing outside of China in the past, but in their current and successive iterations, China has taken up the mantle to become the leading manufacturer. Take the simple example of the light bulb. It began its life outside China, but in the manufacture and advances of its successor, LED lights, China is the de facto manufacturing leader. Similarly, smartphones and many other products are also on the same trajectories. 

In fact, on the buzz generated by this decision, stocks of BYD, the largest Chinese electric vehicle manufacturer rose by a healthy 7.2 percent. Battery manufacturers also saw similar upward ticks in stock prices and valuations. 

Furthermore, due to the Chinese governments support of such initiatives, the subsequent boost given to Chinese manufacturers will spur them on towards taking the lead in electric car technology and market domination. The main difference in all this from other countries is that due to China’s colossal manufacturing base, it can harness economies of scale to churn out affordable electric vehicles to enable mass adoption. This is where the actual paradigm shift will occur. 

In addition to these, another profound change will also come into affect a bit later. Due to the rise of electric vehicles and renewable energy, the dynamics of the energy industry will also radically shift to adjust to the change in supply and demand. There is potential for surplus resources to be cheaply harnessed in the isolated cases to assist developing and under developed nations to bring about effective positive change in their economic fortunes.

The push towards electric vehicles will also be combined with the development of new technologies, with some of the greatest potential being in driverless cars. This will hopefully usher in a new age of safe and efficient daily commutes, cleaner air and greatly reduced noise pollution, inevitably leading to a better quality of life. 

All in all, it is a win-win situation for China and the world when the largest manufacturer and purchaser of vehicles takes up a vital responsibility and commits to bringing about such large scale change that has the potential for creating a better future for humanity.

(The author is a digital media producer and strategist, tech enthusiast and digital nomad. Can be contacted at: hassanarshadlive@outlook.com)

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LU Xiankun Professor LU Xiankun is Managing Director of LEDECO Geneva and Associate Partner of IDEAS Centre Geneva. He is Emeritus Professor of China Institute for WTO Studies of the University of International Business and Economics (UIBE) and Wuhan University (WHU) of China and visiting professor or senior research fellow of some other universities and think tanks in China and Europe. He also sits in management of some international business associations and companies, including as Senior Vice President of Shenzhen UEB Technology LTD., a leading e-commerce company of China. Previously, Mr. LU was senior official of Chinese Ministry of Commerce and senior diplomat posted in Europe, including in Geneva as Counsellor and Head of Division of the Permanent Mission of China to the WTO and in Brussels as Commercial Secretary of the Permanent Mission of China to the EU. Benjamin Cavender Benjamin Cavender is a Shanghai based consultant with more than 11 years of experience helping companies understand consumer behavior and develop go to market strategies for China. He is a frequent speaker on economic and consumer trends in China and is often featured on CNBC, Bloomberg, and Channel News Asia. Sara Hsu Sara Hsu is an associate professor from the State University of New York at New Paltz. She is a regular commentator on Chinese economy. Xu Qinduo Xu Qinduo is CRI's former chief correspondent to Washington DC, the United States. He works as the producer, host and commentator for TODAY, a flagship talk show on current affairs. Mr. Xu contributes regularly to English-language newspapers including Shenzhen Daily and Global Times as well as Chinese-language radio and TV services. Lin Shaowen A radio person, Mr. Lin Shaowen is strongly interested in international relations and Chinese politics. As China is quite often misunderstood in the rest of the world, he feels the need to better present the true picture of the country, the policies and meanings. So he talks a lot and is often seen debating. Then friends find a critical Lin Shaowen criticizing and criticized. George N. Tzogopoulos Dr George N. Tzogopoulos is an expert in media and politics/international relations as well as Chinese affairs. He is Senior Research Fellow at the Centre International de Européenne (CIFE) and Visiting Lecturer at the European Institute affiliated with it and is teaching international relations at the Department of Law of the Democritus University of Thrace. George is the author of two books: US Foreign Policy in the European Media: Framing the Rise and Fall of Neoconservatism (IB TAURIS) and The Greek Crisis in the Media: Stereotyping in the International Press (Ashgate) as well as the founder of chinaandgreece.com, an institutional partner of CRI Greek. David Morris David Morris is the Pacific Islands Trade and Investment Commissioner in China, a former Australian diplomat and senior political adviser. Harvey Dzodin After a distinguished career in the US government and American media Dr. Harvey Dzodin is now a Beijing-based freelance columnist for several media outlets. While living in Beijing, he has published over 200 columns with an emphasis on arts, culture and the Belt & Road initiative. He is also a sought-after speaker and advisor in China and abroad. He currently serves as Nonresident Research Fellow of the think tank Center for China and Globalization and Senior Advisor of Tsinghua University National Image Research Center specializing in city branding. Dr. Dzodin was a political appointee of President Jimmy Carter and served as lawyer to a presidential commission. Upon the nomination of the White House and the US State Department he served at the United Nations Office in Vienna, Austria. He was Director and Vice President of the ABC Television in New York for more than two decades.