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    Why China Can’t Handle an All-or-Nothing Tack on Gasoline

    Several European countries have set timelines for completely phasing out gas-powered vehicles, but the same policy is unsuited to China’s auto industry.

    In the aftermath of a series of decisions by European countries to ban the sale of gas- and diesel-powered cars, Xin Guobin, the Chinese vice minister of industry and information, stated at a recent auto industry forum that China, too, could implement a timetable for phasing out nonelectric vehicles. I cannot endorse this idea, nor do I agree with those online who herald it as the dawn of a “new era” for automobiles. In fact, even the more cautious approaches advocated by industry experts seem to me to go too far.

    China manufactures more vehicles than any other country on earth, and its annual production capacity will soon exceed 30 million units. The smart response to a few countries issuing restrictive timetables would be to draft a series of strategic countermeasures designed to ensure that China remains competitive in the global market, not to blindly rush off and try to emulate others’ goals. Setting an arbitrary deadline for the complete elimination of nonelectric vehicles negates the progress that the auto industry has made in improving and optimizing conventional engines. Put simply, it’s the equivalent of running over our own feet.

    On the surface, the recent moves by the likes of Norway, Germany, France, the U.K., and the Netherlands to impose uniform rules banning the sale and production of nonelectric vehicles appear noble from an environmental standpoint. Before we can pass judgment on these decisions, however, we must first understand the logic behind them.

    First, it must be said that, with the exception of Germany, these countries lack strong domestic auto industries. For Norway and other radically pro-environment Scandinavian countries, therefore, the decision to ban the sale of gas- and diesel-powered cars and instead import electric models will have few negative economic side effects. The U.K. was once home to a thriving auto manufacturing industry, but in recent years most of the country’s large auto companies have been sold off to German, Indian, or Chinese manufacturers. As a result, the economic punch of a shift toward electric vehicles would be felt more keenly abroad than at home.

    While all electric cars may seem more or less the same, their impact on the environment is closely tied to whether they draw power from “clean” or “dirty” sources. The majority of countries that have announced plans to ban the sale of nonelectric vehicles get a substantial proportion of their energy from clean sources, such as wind, solar, hydro, or nuclear power. Clearly, these are all more environmentally friendly ways of powering a vehicle than filling it with smog-spewing gasoline or diesel. The U.K.’s decision to ban all nonelectric vehicles by 2040, for example, was made possible by an earlier decision to close all domestic coal-fired power plants by 2025.

    Hypothetically, if China’s goal in banning the production and sale of gas- and diesel-powered vehicles were to establish itself at the forefront of global conservation efforts, it would only be able to accomplish this by phasing out nonelectric cars even earlier than 2040 in order to beat the British. However, taking conventional engines off the roads would pose a significant threat to China’s security. Civil transport capacity plays an important role in times of war or in the aftermath of national disasters, when military supplies are vital to evacuating civilians and the wounded. If all of China’s roads lack the ability to sustain vehicles that run on conventional fuels, it would take just one major earthquake to expose the shortcomings of the country’s transport infrastructure.

    Even if the government chooses a more cautious approach and targets zero-emissions cars by 2050, it runs a different set of risks. Prior to the invention of the modern gasoline-powered vehicle in 1886, the automotive industry went through a 100-year period of constant evolution, from the first wood- and coal-burning cars in 1769 to the invention of new coal-burning models just over a century later. We then spent the next 100 years improving on gasoline-powered vehicle technology.

    One hundred years of work have gone into conventional engine technology, while fuel cells, hydrogen-powered cars, hybrid vehicles, and plug-in electric vehicles have all been around for decades. The technology exists, and this is ultimately what will put conventional cars out of business. However, it is premature to predict exactly which form the car of the future will take.

    China is a uniquely favorable market for cleaner vehicles. The country already possesses advanced hybrid and hydrogen power technology, lowering the technological barriers to entry. Tens of millions of electric scooters already on the roads suggest there is a market for ditching conventional fuels, and the electric vehicle industry has received significant government support. There is no reason to think electric cars will not be successful in China eventually. We will go green, but we must do so at a reasonable pace.

    Since the 2008 financial crisis, the auto industry has made greater effort to develop new energy and plug-in electric technologies. Initially, the major auto companies were not enamored by the prospects of this technology, but after seven or eight years spent eyeing the tantalizing China market they have noticed the passion people here have for electric vehicles. The scene at this year’s Frankfurt Auto Show proved that the large car companies have thrown themselves into developing plug-in electric models. Highlighting the trend, Volvo, Toyota, Volkswagen, and General Motors all announced commitments to greener auto technologies.

    Alongside the U.S., Germany, and Japan, China is one of the global leaders in automobile manufacturing. For the Chinese government to declare a commitment to phase out conventional engines in favor of electric ones would be like the proverbial butterfly that flaps its wings in Beijing and sets off a chain reaction around the world.

    New technology should be disseminated as quickly as possible, yet development is also a constant process of improving and perfecting currently existing designs. To me, further developing hybrid systems is a wiser choice than completely abolishing traditional fuels and going fully electric.

    Hybrids are capable of switching between various power systems at will and are certain to become the norm in the coming years. Further down the road — say, a century from now — China’s national grid might be completely powered by solar, wind, or hydroelectric power. But that transition is still a long way off. For now, Chinese car companies are fighting tooth and nail to hold their own against their overseas counterparts, and there’s no need for the state to make uncertain commitments that give fuel to the competition.

    Translator: Kilian O’Donnell; editors: Lu Hongyong and Matthew Walsh.

    (Header image: A rush-hour traffic jam on a road in Nanjing, Jiangsu province, Oct. 1, 2017. VCG)