Ford's China Partner Makes Bold EV Move In World's Top Auto Market
A Ford Motor (F) partner in China plans to go all-electric by 2025, in one of the boldest moves yet from a Chinese carmaker, even as that nation's aggressive push on electric vehicles has set off a scramble among both foreign and domestic automakers.
XAutoplay: On | OffChongqing Changan Automobile, a leading state-run carmaker and China's No. 2 auto brand, plans to invest more than $15 billion in EV development, as well as to launch 21 pure-electric cars and 12 plug-in hybrid models by 2025, according to the Wall Street Journal.
Changan's move comes as China steps up pressure on automakers to produce electric vehicles (EVs), requiring them to start producing electric cars by 2019 and gunning for 1 in 5 cars sold in the nation to be electric by 2025.
Ford, for example, recently created a new partnership with Anhui Zotye Automobile, which aims at electric car production and supplements existing joint ventures with Chongqing Changan and Jiangling Motors.
Volvo Cars, now owned by China's Zhejiang Geely Holding Group, said earlier this year that it would only make electric or hybrid cars starting in 2019. And Volkswagen (VLKAY) is partnering with Anhui Jianghuai Automobile on EVs.
Ford shares edged up 0.1% at 12.20 on the stock market today, trading just under a 12.56 flat-base buy point. General Motors (GM) rose 0.3%, Fiat Chrysler (FCAU) sank 5%, and Volkswagen lost 0.8%. Tesla (TSLA), which counts China as its largest market after the U.S., tumbled 2.5%. Kandi Technologies (KNDI), a China-based maker of electric cars, fell 3.5%.
China's double-barreled stance on electrification comes amid a global shift away from cars powered by internal combustion engines. In September, it threw its weight behind moves by France, Britain and India to eventually ban the sales of traditional gas or diesel vehicles.
While Britain and France have offered a 2040 time frame for banning cars that burn gasoline or diesel, China and India have not set a specific deadline.
But the Chinese policy change is especially seen as a game-changer, forcing the world's automakers to adapt. China not only dominates global auto sales, but also has ambitions to become a leading producer of so-called "new energy vehicles" in an increasingly electrified auto market.
GM unveiled plans earlier this month to launch 20 new all-electric models by 2023, while Ford said it would add 13 electric models in the coming years. Both automakers have sizable stakes in China, operating in that heavily regulated market through local joint ventures.