The China new energy vehicle (NEV) taxi market is foreseen to ride on the aggressive response to company owned type of NEV taxis for its extensive success. The operation and maintenance of NEV taxis are mostly handled by taxicab companies, although a majority of them are owned by the state. The short range NEV taxis gained a lot of traction in the past due to the large demand from frequent local commuters. However, a sizable share in the Chinese market is expected to be acquired by the long range NEV taxi segment on the back of valuable developments in battery technology.
A report by leading research firm, Transparency Market Research (TMR), predicts the China NEV taxi market to attain the revenue figure of approximately US$0.56 bn by 2020. In 2016, the market had raised a revenue of US$0.15 bn. By the end of 2020, the number of taxis in China could take some hike due to the decreasing lifecycle of traditional fuel based taxis.
Will Government Support to Promote Energy Savings and Green Vehicles Heighten Demand?
The Chinese government is looking to make available a least of five million electric cars on the streets by 2020 and likewise promote NEVs to address the rising environmental concerns. Of these, increasing energy demands, elevating greenhouse gas emissions, and speedily exhausting natural resources and fossil fuels have taken precedence. In this regard, the government has also introduced a number of effective NEV subsidies.
The China NEV taxi market could also gain impetus from the ability of NEVs to slim down carbon dioxide emissions by a whopping 40.0%, which is a tough competition to internal combustion engine vehicles (ICEVs).
China is one of the largest net importers of oil and the demand is continuing to increase as the Chinese streets get overcrowded with vehicles due to rapid urbanization. Moreover, the global oil prices are anticipated to augment considerably, which could create significant oil supply fluctuations in China. However, with NEVs, China can sustain their independence and also keep their rising oil and gasoline consumption at check.
The advancement in technology, especially pertaining to charging models and batteries, has put NEVs in a position where they are becoming practicable in select mass market applications.
Is Lack of Full-scale Charging Infrastructure an Exposure to Market Risk?
The growth of the China NEV taxi market could be hindered due to the uneven and limited distribution of charging stations, although there have been advancements witnessed in vehicle electrification. Besides this, the market could suffer from the cost of NEVs and their batteries and issues related to reliability and safety.
Howbeit, some of the crucial opportunities are envisaged to take birth from the paradigm shift from ICEVs to NEVs, which has offered a vital upgradation not only in terms of business models but also sustainable electric mobility. Moreover, the rear and bottom battery swap models have eliminated the problem of going out of battery during unexpected times. A fully charged battery can be installed only within 10 minutes with the help of battery packs reserved within the vehicle body. Not to forget, reliable chances of growth for the China NEV taxi market are envisioned to be provided by the use of range-extended electric vehicles (REEVs) and vehicle-to-grid (V2G) technology.
Browse Research Release:
Prominent players such as Anhui Jianghuai Automobile Co. Ltd. (JAC), Beijing Automotive Industry Holding Co. Ltd. (BAIC), Dongfeng Nissan Passenger Vehicle Company, Beiqi Foton Motor Co. Ltd., BYD Auto Co. Ltd., and Changan Automobile Co. Ltd. are foreseen to exhibit dominance that is worthy of attention.