Tesla’s Nemesis in China Is a Tiny $5,000 Electric Car From GM
Bloomberg NewsSeptember 26, 2020, 6:00 AM GMT+7
- SAIC-GM-Wuling’s Hongguang MINI EV has been a runaway hit
- The EV outsold Tesla in August in world’s biggest car market
Hongguang MINI EV Source: SAIC-GM-Wuling Automobile Co.
Known globally for its trucks and muscle cars, General Motors Co. has scored a surprise hit in China with its local partners: a petite electric vehicle that sells for less than $5,000.
The Hongguang MINI EV, made by SAIC-GM-Wuling Automobile Co., is currently the hottest EV in China, the world’s biggest automobile market. Sales of the compact four-seater beat industry giant Tesla Inc. in August, with consumers wowed by its tiny price tag -- the EV retails for between 28,800 yuan ($4,230) and 38,800 yuan -- and its ability to run for as many as 170 kilometers (106 miles) on a single charge. Orders exceeded 30,000 units in just 50 days.
The MINI EV’s runaway success underscores the latent demand for electric cars at the right price point. Tesla earlier this week said it plans to build a $25,000 EV in about three years. One of the biggest challenges in making EVs cheaper is the battery, which currently represents about one-quarter of a car’s cost because of the expensive metals used, such as lithium, cobalt, nickel and manganese.
“A lot of consumers don’t need anything fancy, a commute is all they ask from a car,” said Yale Zhang, founder of AutoForesight, a Shanghai-based consultancy. “I’m all for a product like the MINI EV.”
The car is also a fillip for GM in China, whose market share has been on the decline. The U.S. automaker said in January it sold about 3.1 million vehicles in China in 2019, down 15% on 2018. The Detroit-based firm’s slump has been exacerbated by the trade war with the U.S., and sales of its Buick and Chevrolet brands have taken a beating...