The Shanghai Auto Show reverberated with an array of new, mainly electric vehicles or plug-in hybrids of all shapes, sizes and prices. But it was a cheap little electric vehicle that caught my attention watching from Europe; introducing the BYD Seagull.

Not only is this little car priced to go, locally from $11,300, it may well contain interesting new battery options including BYD’s lithium-ion phosphate “Blade”, or, according to investment researcher Evercore ISI, a sodium-ion battery.

Sodium-ion batteries are said to be less prone to fires, and are cheaper, using abundant sodium rather than scarce lithium.

The European market for electric vehicles has made impressive progress over the last 5 years. Schmidt Automotive Research says sales in Western Europe jumped from a market share of 2.5% in 2019 to about 15% by the end of this year or an estimated 1.6 million sedans and SUVs.

This progress has been driven by government subsidy, EU regulations and the embrace of well-heeled early adopters. This has resulted in an unbalanced market. Prices start at about $25,000 after tax but more like $35,000 to $40,000. This effectively excludes average wage earners, who have been served until recently by cheap cars like the Ford Ka, Citroen C1, Peugeot 108, SEAT Mii, and Renault Twingo. Manufacturers say they can’t make these little cars for the mass market and make profits because of EU rules.

As EU regulations tighten towards the ultimate goal of a total ban on new internal combustion engine (ICE) vehicles in 2035, European car buyers at the bottom of the market are being excluded. Local manufacturers have failed to meet this demand so far. The big-selling HongGuang MINI, made in China by a joint venture between General Motors of the U.S., China’s SAIC and Wuling, was thought to be about to launch a Europeanized version, but this plan seems to have stalled.

BYD, announcing the new Seagull which will offer range of 190 or 252 miles, didn’t say if it would be sold in Europe. But BYD has big ambitions here. Earlier this month it unveiled the Dolphin compact hatchback for Europe, priced at $33,000 after tax, and has already launched the Seal midsize sedan, the Atto 3 compact SUV, the Han large sedan and the Tang large SUV.

Wouldn’t the Seagull be a serious contender to fill this market gap?

Professor Ferdinand Dudenhoeffer, director of Germany’s Center for Automotive Research (CAR), isn’t so sure and says Europeans are unlikely to be interested in bare-bones vehicles.

“It sounds interesting at first glance, but let’s talk about some details,” Dudenhoeffer said in an email exchange.

He said the Chinese market is different, with the big-selling Hongguang MINI offering a range of only about 100 miles and less in cold weather.

“That doesn’t work for us (Europeans). In China, this is used by small businesses and more in the suburbs or in rural areas. Do you remember the Tata Nano? It was supposed to be a revolution and ended up being a flop. Safety in small cars is a big issue in Europe, with airbags, door reinforcement, computerized safety, etc,” Dudenhoeffer said.

The trouble with most electric cars on the market is that they are not only very expensive, despite being described constantly and erroneously as “affordable”. But they can’t compete with the ICE car’s all-round ability. EVs are unable to compete with ICE cars in high-speed, long-distance cruising, for instance.

Buyers at the lower end of the market require small and inexpensive EVs. These vehicles would have no long-range pretensions and concentrate on what electric power does best. They are unbeatable in urban mode for commuting, shopping, and the school run. Charging would take place at home, so hugely expensive networks wouldn’t be required. Batteries would be small, so CO2 advantages would be greater. They would require no subsidy.

Would so-called “quadricycles” like the Citroen Ami and the Microlino, which aren’t subject to the same EU safety regulations as regular cars, be successful at the cheapest entry-level? Dudenhoeffer doesn’t think so, and expects to see seriously affordable EV vehicles soon.

“The Microlino or Citroen Ami are not cars. Not everything which has 4 wheels must be a car. I think that we will see entry-level EVs with 350-kilometre (218 miles) range and (real car safety, connectivity and comfort) between €15,000 and €20,000 ($16,540 and $22,050),” Dudenhoeffer said.

The Shanghai Auto Show concentrates on battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), Bernstein Research said.

“Of all the new car launches, we estimate approximately three-quarters of the launches are BEVs and PHEVs. Per our observation, ones of heightened interest among domestic Chinese players include XPeng’s G6 SUV and Zeekr X, as well as BYD’s Yangwang and Denza series. Among foreign brands, VW ID.7 and BMW iX1 also drew more attention,” Bernstein said in a report.

Competition in the Chinese market is intensifying and local manufacturers will be seeking new export markets, according to Steve Young, managing director British-based automotive retailing consultancy ICDP.

“The intensity of the price war in China makes it even more important for them to find opportunities to sell significant volumes of product in markets where they have more headroom in terms of pricing,” Young said.

Europe is about to receive the first impact of Chinese automakers’ exports, not least because the U.S. Inflation Recovery Act contains provisions likely to makes sales in American markets difficult.

Patrick Koller, CEO of French auto supplier Faurecia, reckons the entry-level BEV market in Europe is ripe for attack by China. He said China could sell 1 million electric cars a year of all types here, about 8% of the market last year.

“I think an attractive car for Chinese consumers will be an attractive car for a European consumer,” Reuters quoted him saying in an article from the Shanghai show.


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