Chinese £3,200 budget electric car takes on Tesla


A low-cost electric vehicle (EV) selling in China for $4,500 (£3,200) is now outselling Tesla’s more expensive cars.

The small car is proving a big hit for state-owned SAIC Motor, China’s leading automaker.

The Hong Guang Mini EV is built as part of a joint venture with U.S. auto giant General Motors (GM).

Last month, sales of the affordable electric car in China were about double those of Tesla, which was questioned this month over safety issues.

While the $4,500 Hong Guang Mini is the most popular model, there is also an upgraded model with air conditioning for just over $5,000. The cars are marketed as “the people’s commuter tool.”

The joint venture partnership, SAIC-GM-Wuling, is known locally as Wuling.

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Auto experts say that although the Wuling lags well behind Tesla in battery, range and performance, its convenience and low price have made it one of the best-selling “new energy” vehicles in China.

The base model, which was launched last year, has a top speed of 100 km/h and can fit four people in a small space.

“China’s government is serious about reducing pollution and taking the global lead in introducing and promoting innovation in electric vehicles,” Shaun Rein, managing director of China Market Research Group, told the BBC.

“We remain very optimistic about the adoption of budget EVs like the Hong Guang Mini to higher-end vehicles like NIO and Tesla.”

To encourage EVs, the Chinese government is offering free license plates that are guaranteed. In many cities, it can take months, if not years, to get a license plate for a gasoline-powered vehicle through various auction systems.

Competing against Tesla

The Hong Guang Mini EV sold 112,000 units in the second half of 2020, second only to Tesla’s Model 3, which is manufactured at its Shanghai factory.

Earlier this month, five Chinese regulators cited Tesla over quality and safety issues at its factory. China is Tesla’s largest market after the United States.

In January, Hong Guang Mini’s sales outnumbered Tesla’s nearly two to one. It is now believed to be the second best-selling electric model in the world behind the Model 3.

According to the China Passenger Car Association (CPCA), 25,778 models of the tiny, all-electric electric car were sold in China in January. That compares with 13,843 units sold of the Tesla Model 3.

But high-end electric vehicles still fared well as Tesla more than doubled its sales volume in China last year.

The Model 3 sells for about $39,000 (£27,000) in China, taking into account price cuts due to local production.

The Hong Guang Mini EV could also appear outside China, as Wuling has announced plans to export the EV overseas.

“In China, there are so many manufacturers of small and cheap electric vehicles, but most of them are low-quality and low-speed products that don’t appeal to a broad market,” said Sam Fiorani of Auto Forecast Solutions.

“The Hong Guang Mini is the first time a major company has come out with a basic EV that appeals to buyers looking for a real car.”

Reports have linked Wuling to a Latvian automaker that could sell a version of the car in Europe. However, the price will likely be double due to European environmental regulations.

 

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