McKinsey: Slow Development of China's Electric Vehicles

McKinsey, a global management consulting company, recently released a research report on “Rejuvenating China's Electric Vehicle Industry”. The report stated that although the current sales volume of China's electric vehicles is not satisfactory and it is far from achieving the great development of electric vehicles, it is predicted that China is still expected to lead the global electric vehicle industry.

Although the government has introduced a series of supporting policies, the development of electric vehicles in China is still relatively slow. According to the McKinsey survey, in 2011, domestic auto manufacturers produced only about 6,000 pure electric vehicles and plug-in hybrid vehicles. The "McKinsey Electric Vehicle Index" shows that the overall maturity of China's electric vehicles fell from the third position in July 2010 to fifth place in February 2012, ranking behind Japan, the United States, France, and Germany.

According to this research report, the Chinese electric vehicle industry is currently facing problems such as high costs, imperfect infrastructure, few models, and far from mature technologies, which restricts its development.

However, this report also pointed out that China should still insist on the long-term development of electric vehicle industry. McKinsey predicts that due to battery costs and other reasons, the current cost of pure electric vehicles is high, and it will not be comparable to the cost of an internal combustion engine car until around 2020.

The report suggests that as a medium- and short-term strategy, the Chinese automobile industry should consider plug-in hybrid vehicles as a transitional technology until the entire industry ecosystem is mature enough to support mass production of pure electric vehicles.