$45,000 SUV With Smartphone's Ease Shows China Ambitions
(Bloomberg) -- A $45,000 electric SUV using facial recognition to unlock doors, Amazon’s Alexa to entertain and a 49-inch screen across the dashboard may be a harbinger of driving’s future. It also shows what China’s doing to grab that business now as the government pushes gas guzzlers off its roads.
Byton, a Nanjing-based company started by former BMW AG executives, on Sunday became the first Chinese automaker to hold a large-scale unveiling at CES in Las Vegas. XPeng Motors, backed by funding from Alibaba Group Holding Ltd., is set to unveil a production model on Tuesday. That’s on the heels of launches by new entrants such as NIO, backed by Asia’s biggest technology company, Tencent Holdings Ltd.; and WM Motor Technology Co.
China’s drive to curb pollution and reduce dependence on imported oil, coupled with generous government subsidies, is spawning dozens of new-energy automobile startups in what’s already the world’s biggest market for vehicles. The fledgling carmakers now have the task of luring customers from Tesla Inc. and giants such as Volkswagen AG and Toyota Motor Corp., which have about $100 billion combined in cash, equivalents and short-term investments to fight back.
“China is the world’s fastest-growing and biggest EV market, but at the same time, it’s short of global players and companies producing products that can compete with the best premium players in the world,” Daniel Kirchert, Byton’s chief operating officer and co-founder, said at the concept SUV’s unveiling.
China already leads globally in EV sales, passing the U.S. in 2015. Sales of new-energy vehicles -- including EVs, plug-in hybrids, and fuel-cell vehicles -- may have topped 700,000 units last year on their way to 1 million this year, said Xu Haidong, assistant secretary-general of the China Association of Automobile Manufacturers. Almost all those cars are Chinese brands. The government has set a sales target of 7 million vehicles by 2025.
The newest competitor is Byton, formerly known as Future Mobility Corp. Its first model will be available for sale next year starting at $45,000, compared with a $35,000 base price for Tesla’s Model 3. Byton will complete its Nanjing factory in late 2018 and start production a year later.
Byton “is vying to become a global company created in China,” said Bill Russo, founder and CEO of Automobility Ltd., who was at the Byton event. “What the Byton team has achieved is a clear articulation of the future of mobility.”
Promising internet connectivity and digital services in its Smart Intuitive Vehicles, or SIVs, Byton is among a crop of companies trying to upend traditional carmakers as powertrains move away from polluting fuels and battery makers seek longer driving ranges between charges.
Byton received $200 million from a fund of Suning Holdings Group Co. and some state-owned firms in Jiangsu province, Kirchert said in August. Another investor is China Harmony New Energy Auto Holding Ltd.
Toyota also doubled down on its battery-powered bet Monday, unveiling at CES a fully autonomous electric vehicle concept called the e-Palette. Chinese ride-hailing giant Didi Chuxing joins Amazon.com Inc. and Uber Technologies Inc. as a partner in an alliance that will jointly develop and test the customizable concept vehicle.
“Today, less than 1 percent of all vehicles sold in the U.S. are battery electric, so there’s much work to be done to increase consumer demand for all electric vehicles,” Akio Toyoda, the automaker’s president, said in remarks at the event, noting that the carmaker is working with governments to create more charging stations and infrastructure.
Byton is partnering with Robert Bosch GmbH and France’s Faurecia, and will announce a strategic tie-up in Silicon Valley for autonomous-vehicle development this month, Chief Executive Officer Carsten Breitfeld said.
Breitfeld was a leading engineer for BMW’s i8 electric car and worked at the German maker for about 20 years, while Kirchert was in charge of marketing at BMW’s local venture in China and worked at Nissan’s Infiniti.
Some of the features Byton offers include:
- Driving range of 400 kilometers (249 miles) for the base model and 520 kilometers (323 miles) for the higher, four-wheel-drive variant
- 80% of the battery can be recharged in 30 minutes
- Production car to have L3 Advanced Driver Assistance Systems; L4 autonomous driving to be enabled from 2020 via a software upgrade
- Concept supports video and teleconference capability
- Human-vehicle interaction incorporates voice recognition, touch control, biometric identification and hand gestures
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