Bottom line: Bureaucracy at the homeowner level is providing a major obstacle to China’s ambitious new energy vehicle build-up plan, with new government directives unlikely to fix the problem.
Building bureaucracy blocks EV charge
A new report is showing just why new energy vehicles are failing to gain any traction among Chinese consumers, despite huge government efforts to promote the technology. The main culprit in this case is the country’s huge bureaucracy, which affects everything from the largest government programs all the way down to something as simple as installing a vehicle charger in an apartment building.
In most western cities, the installation of an electric vehicle (EV) charger at a person’s home would be a simple matter, involving a visit from a specialist to hook up the proper equipment. Apartments could be slightly more complex though still manageable, since they would involve modifications at collectively owned buildings. But in China, where most people live in apartments, the bureaucracy of installing chargers in such buildings rises to a whole new level, creating a major obstacle that’s unlikely to go away anytime soon. Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 25. To view a full article or story, click on the link next to the headline.
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Adobe (Nasdaq: ADBE) To Close China R&D Center (Chinese article)
Geely (HKEx: 175) Announces Issue of $300 Mln In Senior Notes Due 2019 (HKEx announcement)
Intel (Nasdaq: INTC) To Take 20 Pct Stake In Mobile Chipmaker Spreadtrum – Source (English article)
ZTE (HKEx: 763) Welcomes Withdrawal Of Patent Claim Before UK Court (Businesswire)
The following press releases and media reports about Chinese companies were carried on September 17. To view a full article or story, click on the link next to the headline.
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Alibaba Raises IPO Price Range To $66-$68 Per ADS (Chinese article)
Geely (HKEx: 175) Proposes Issue Of US Dollar-Denominated Senior Notes (HKEx announcement)
Despite disappointing progress in China’s plan to put hundreds of thousands of new energy vehicles on its roads by next year, American electric car maker Tesla (Nasdaq: TSLA) has made remarkable progress despite its late arrival to the market. The company has won its strong initial results though a smart combination of savvy marketing and initiatives to encourage building of necessary infrastructure to support its buyers.
The latest of those initiatives saw Tesla last week announce a partnership with Unicom (HKEx: 762; NYSE: CHU), China’s second largest mobile carrier, to install charging stations at hundreds of Unicom outlets nationwide. (English article) As a result of these and other efforts, Tesla has been the lone player so far to succeed in China’s broader consumer market, an area that will be critical to achieving Beijing’s goals. Read Full Post…
A couple of headlines are spotlighting the ongoing woes of 2 groups in China’s auto sector, with domestic brands and new energy vehicle makers both showing signs of difficulty. In the former category, reports that former domestic high-flyer Chery is closing one of its biggest Beijing dealerships spotlight the broader woes of domestic car brands that are losing share to better-run foreign rivals. In the latter category, another media report is showing that new energy vehicle sales were largely insignificant in the first 4 months of the year, even though they did notch major gains over 2013. Read Full Post…
New York is firmly establishing a reputation as the preferred listing venue for China Internet IPOs, while Hong Kong is developing a taste for auto-related listings. That’s my quick assessment following reports that online video sharing site Xunlei has just joined a long queue of Chinese Internet firms filing to list in New York. At nearly the same time, car rental company China Auto Rental has filed to list in Hong Kong, reversing course from a previous plan to offer shares in New York. Read Full Post…
Chinese car makers are fueling a new global buying binge of clean-energy assets, with the latest word that privately owned Geely Automobile (HKEx: 175) is buying a British electric car startup. Geely’s deal comes just weeks after China’s Wanxiang Group completed its second major acquisition of a clean energy firm in the US, hinting at a growing wave of global M&A by tech-hungry Chinese car makers. This flurry of deals also comes as China’s leading electric vehicle (EV) maker, BYD (HKEx: 1211; Shenzhen: 002594), spotlights new government data that showcases its own technology development prowess. Read Full Post…
Telecoms history looks set to repeat itself, with word that a Chinese investor is in talks to buy the office telecoms business of struggling French networking equipment maker Alcatel-Lucent (Paris: ALU). On the one hand, I have to congratulate Alcatel for getting any money at all for the unit, which I suspect is either losing money or perhaps is marginally profitable. On the other hand, I honestly don’t understand why Chinese investment firm Huaxin Post & Telecommunication could possibly want this business, following a disastrous track record for similar European acquisitions by Chinese firms. Read Full Post…
A slew of year-end news about China’s auto industry is shining a spotlight on the tough times that domestic car makers are facing not only at home but also abroad as they grapple with tough competition and other market factors. Domestic nameplates like Geely (HKEx: 175), Chery and BYD (HKEx: 1211; Shenzhen: 002594) have steadily lost share in their home market over the last few years to big foreign names like GM (NYSE: GM) and Volkswagen (Frankfurt: VOWG), but posted strong export gains as they looked to overseas markets to partly offset the declines at home. But now even the export picture is looking bleak, with the latest word that no Chinese car makers will attend the industry-leading North American International Auto Show in Detroit this week. (English article) Read Full Post…
It’s quiet outside as markets reopen on this first work day after the New Year, so I thought I’d start off 2014 with some predictions for the year ahead in the sectors that I cover. Generally speaking, I do think the first half of the year will see a continuation of strong momentum that began in late 2013 for many sectors. But that momentum will slow as we near the mid-year mark, and 2014 could end with a whimper as the Chinese economy continues to slow and Beijing pushes for higher quality growth. Read Full Post…
There’s upbeat news come from 2 of China’s top domestic automakers, led by word that Dongfeng Motor (HKEx: 489) has finally signed a joint venture deal to make sport utility vehicles (SUVs) with France’s Renault (Paris: RENA) after more than a year of negotiations. Meantime, Geely Auto (HKEx: 175), which is trying hard to turn around struggling Swedish automaker Volvo, has announced its own major new auto financing joint venture with France’s BNP (Paris: BNP). This sudden love fest between Chinese automakers and French companies is probably just coincidence, since the 2 deals look unrelated. But both look like smart moves, as they involve Chinese firms pairing up with relatively strong, experienced foreign partners. That contrasts sharply with the more common Chinese preference in the past for sickly, struggling companies, especially when Chinese firms buy equity stakes in their venture partners. Read Full Post…
