Tiny GM Car Zips Past Tesla To Lead China's Electric Vehicle Market
By Trefor Moss
SHANGHAI -- A tiny electric vehicle from General Motors Co. with
a top speed of 62 miles an hour has zoomed past the Tesla Model 3
to become China's bestselling EV.
Launched in late July under GM's local Wuling brand, the
Hongguang Mini costs $4,300 and primarily targets consumers in
China's smaller, less affluent cities. The Model 3, which Tesla
Inc. started producing in Shanghai last year, costs roughly $37,600
after subsidies and is tilted more toward buyers in China's wealthy
GM's strategy to go after the low end of China's EV market runs
counter to its approach in the U.S., where it plans to launch a
battery-powered Hummer pickup truck under its GMC brand in about a
year, priced at around $113,000. After years of struggling to sell
relatively affordable electrics like the Chevrolet Bolt, GM's
coming slate of EVs will include larger vehicles and luxury cars,
which should help the company turn a profit on them, analysts
Through the three months ended Oct. 31, the Hongguang Mini
notched 55,781 in sales, compared with the Model 3's 35,283 sales
over that same stretch, according to the China Passenger Car
Association. The duo are the top-selling EVs in China by a wide
margin, accounting for nearly a quarter of the purchases.
Wuling, which GM produces through one of its two Chinese joint
ventures with state-run SAIC Motor Corp., has been the dominant
player in China's entry-level segment for many years. The
Hongguang's instant success suggests Wuling is well-placed to
maintain that position as auto makers transition away from gasoline
to electric propulsion.
The mini EV also launched into a favorable market. Chinese EV
sales emerged from a year-long slump in the summer and are now
rapidly increasing again, more than doubling year-over-year in both
September and October.
She Xiubing, an architect in the southern city of Shantou,
bought a Hongguang last month for daily trips to her office and to
her son's school, both of which are within a three-mile radius of
her home. Its size was one attraction. "Driving a clunky sedan can
be a nightmare here -- you can get stuck in an alley for half an
hour," Ms. She said.
Millions of people in China drive electric scooters rather than
cars, and for them the Hongguang is an appealing upgrade, offering
better safety and cover from the elements, Ms. She said. It comes
with few frills, but "you get what you pay for," Ms. She said.
Overall, about 144,000 EVs were sold in China last month. That
compares with 30,590 plug-in vehicles sold in the U.S. in October,
according to Argonne National Laboratory, which tracks U.S. EV
The popularity of the Hongguang shows the potential for mass EV
adoption across China if auto makers can produce cheap EVs that
inspire confidence on the key issues of safety and range, said
Michael Dunne, chief executive of the consulting firm ZoZo Go.
The Hongguang can travel 105 miles on a single full charge.
"GM can now say they're the market leader in EVs. That's quite
an achievement," said Mr. Dunne, even if the margins on the
Hongguang are thin. "The question is: How do you take those
consumers to higher price points? It's really important they
establish themselves at the high end."
In contrast with the Hongguang, GM has struggled to find buyers
for higher-priced EVs released under the Buick brand. The company
says it has more EVs in the pipeline. "We're well-prepared for this
EV future," said a company spokeswoman, adding that EVs are set to
account for 40% of GM's product launches in China over the next
She didn't say whether the Hongguang Mini is profitable or
whether GM is increasing output to meet demand. "But I can tell you
we're selling every Hongguang we make," she said.
GM's rivals are also ramping up EV output. Volkswagen AG started
production at a new Shanghai plant dedicated to EV production in
October. Tesla is set to start building the Model Y crossover in
Shanghai next year.
Ford Motor Co. had sought to challenge Wuling by forming a joint
venture with Yongkang, China-based Zotye Automobile Co. in 2017 to
produce affordable EVs targeting buyers in China's smaller cities.
But the planned venture went nowhere as Zotye ran into financial
difficulties culminating in a bankruptcy filing in September.
--Raffaele Huang in Beijing and Mike Colias in Detroit
contributed to this article.
Write to Trefor Moss at Trefor.Moss@wsj.com
(END) Dow Jones Newswires
November 13, 2020 09:50 ET (14:50 GMT)
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