Shanghai Conference Highlights China’s Focus on Low Emissions, Fuel Efficiency

SHANGHAI – China’s profitable auto industry is aiming to become a key market for environmentally friendly vehicles, with sales to be driven by low-emissions, alternative-propulsion vehicles including hybrids, diesels and electric cars, Nissan Chief Operating Officer Toshiyuki Shiga says.

Shiga makes his remarks at the ninth annual industry forum held here by the China Europe International Business School and attended by top auto executives from the U.S., Europe, Japan and China.

China pushing EVs to save energy.

“With more and more Chinese buying cars, China is in need of alternative-energy vehicles to slow down fast-rising energy consumption,” Shiga says. “My understanding is the Chinese government is keen to push the development of electric cars in China to save energy.”

Nissan’s all-electric Leaf, which already is available in the U.S., Europe and Japan, won government approval in September to be sold in China, he adds.

Fuel efficiency also is Ford’s focus on China. The U.S. auto maker is planning to equip most of its 15 new vehicles in China with its turbocharged EcoBoost engines by 2015, says Joe Hinrichs, president-Ford Asia Pacific and Africa. But opportunities here extend far beyond the next few years.

“(Post 2015) is when the big transition is going to occur in the industry,” he tells attendees. “Not only will we continue to use the technologies we have introduced, we will also see the improved capabilities of all the different new-energy vehicles.”

Ford is betting big on the market, with plans to build two vehicle plants in the country – one in Chongqing with its Changan Ford Mazda joint venture and a second in Nanchang with partner Jiangling.

To handle its planned increase in vehicle production, Ford will double the size of its workforce in China by 2015, adding 1,200 new jobs, Hinrichs recently told WardsAuto.

French auto maker PSA Peugeot Citroen believes attracting China’s growing middle class is the key to success over the next decade, because owning a car is becoming an essential component of the definition of middle class in the country.

“People in the middle class are less price-sensitive, so what we need to do is make the cars they want,” says Gregoire Olivier, PSA’s executive senior vice president, who is stationed in Shanghai.

The auto maker plans to build three new plants, one for engines, in China and grow from 3% of the market to 8% by 2020. It also is expanding its research-and-development center in Shanghai, its only tech center outside of Europe, which plays an important role in developing cars exclusively for Chinese consumers, Olivier says.

“We are facing great opportunities in China, because it not only has a huge market but also serves as a technology platform in Asia,” he says.

For Chinese auto maker Geely, which now owns Volvo, boosting domestic sales means selling more of the Swedish brand in China. “China is Volvo’s second home and an important market,” says Shen Hui, chairman of Volvo Cars China.

Geely has two Chinese plants and plans to sell 200,000 Volvo cars here by 2015, Shen says, noting Volvo’s R&D center in Shanghai serves a critical role in boosting sales.

“It now takes less time for our local engineers to access and adapt the advanced technologies in Europe to develop new Volvo cars for the Chinese market.”