China is set to take the drivers’ seat this year in terms of number of cars produced totaling 11 million. In a surprising green new stance, China also appears to be set to drive ambitious emissions standards that will leave US CAFE lagging behind.

Recent studies have shown that what until now was portrayed as a green giant, might very well be heading for green distinction in terms of mobility. New subsidies, partnerships and joint ventures foresee a bright future in terms of tailpipe emissions for China.

China to take the lead in numbers, subsidies and standards

While US carmakers are going bust everyday, China is, according to the Chinese Association of Auto Manufacturers, aiming for 11 million car sales this year, 17% more than the 9.3 million last year and ahead of the original prediction of 10.2 million. The US sales, in the meantime should not even amount to 10 million this year.

When new 2015 CAFE requirements for US cars are of 36MPG, new models in China already average this requirement and should be over 42MPG by 2015. With strategic partnerships being signed frequently carmakers and battery makers are paving the way for PHEVs and EVs are inclined to conquer the streets in the near future.

Also, according to the Shanghai Securities News, certain areas of China including Chonhqing, Shanghai and Shenzhen are offering discounts up to $5,270 on EVs and PHEVs purchases. The subsidies offered would cover approximately 90 % of the added cost the low emitting vehicles.

These moves were concealed by the State’s auto industry "boost plan," in February this year. Indeed, ambitious guidelines were provided so as to encourage market demand, with scrapping schemes for old vehicles and suppression of road tolls, governmental commitment to buy more national cars. Standardising auto financing and loans, normalising the used-car market, expanding urban transportation systems, speeding up mergers of auto-making groups, supporting auto R&D efforts were also amongst the main requirements of this mobility package.

An overview of Chinese EV/PHEV industry

Amongst many indicators that China is soon to become the land of EVs, the following joint-ventures and products are clear indicators that the US has serious competition if it wants to distinguish itself in the international arena as a major EV player:

• Chinese BYD (Build Your Dream), the world's largest battery makers has now become a PHEV carmaker, with several vehicles in development. The F3DM, already on sale in its homeland, will be the first PHEV to be sold in the world.
• Fiat has a 50-50 joint venture with Guangzhou Automobile Group to build vehicles that meet the Chinese government's requirement for fuel-efficient, low-emission vehicles.
• Chery, the largest independent automaker, has shown several EVs that it says may arrive in 2010. Geely Holding Group has also recently unveiled a concept plug-in sedan while Shanghai Automotive Industry Corporation expects EVs between sometime before 2012.
• Donfeng Motor Company has a joint venture with Netherlands-based Detroit Electric Holdings to build EVs in China.
• Hafei Auto Group (Harin HF), a recently established consortium, is partnering with Southern California startup, Coda, to build in China a $45,000 EV for sale in the U.S.
• Shenzhen Goch Investment is investing $15 million in a joint venture with Phoenix-based ECOtality to build and distribute charging stations in China. The recent Pike Research report sees a $1.9 billion market in charging equipment by 2015, with almost half coming from China.