Beiqi Futian: Two Misunderstandings to Develop New Energy Vehicles

Deputy Secretary of the Beiqi Futian Party Committee and Secretary General of the Beijing New Energy Automobile Industry Alliance Zhao Jingguang

Gasgoo.com: Hello, you are now not only Deputy Secretary of the Party Committee of Beiqi Foton, but also the Secretary General of Beijing New Energy Automobile Industry Alliance. Do you think that after the establishment of Beijing New Energy Automobile Industry Alliance, various members of the alliance, including Beiqi Foton, What kind of role does the development of new energy play?

Zhao Jingguang: Beijing New Energy Automobile Industry Alliance is China's first alliance in the new energy automotive industry. The background of the establishment of this alliance was in December 2008. Minister Wan Gang of the Ministry of Science and Technology and Mayor Guo Jinlong of Beijing Municipality awarded Beijin Foton as “Beijing New Energy Automobile Industry Base”, which is the only new energy vehicle in the country. After designing and manufacturing the base, we have established two centers for new energy design and new energy manufacturing on this basis. After this, our new energy manufacturing base attracted many interested companies both at home and abroad. Under such circumstances, Beijing leaders hope to exert their overall advantages in Beijing and put forward the concept of an industrial cluster. At the time, Zhao Hongtong, a member of the Standing Committee of the Beijing Municipal Committee, was concurrently the Secretary of Haidian District and the secretary of the Zhongguancun Science Park. He proposed that we form a coalition with Zhongguancun and parts and components companies under the promotion of the government. After this, Beijing's colleges and universities, including Beijing Institute of Technology, Tsinghua University, Peking University and other universities and research institutes all participated. Beijing's parts and components companies and Beijing Bus, Xianglong Bus and many other companies also joined the alliance.

We formed this alliance, called the "Five in One," which is the promotion of the new energy automotive industry between government, production, education, research, and use. Although the process of setting up the Beijing New Energy Vehicle Industry Alliance is driven by the government, the establishment of the alliance is not government-led, but the business community needs a coalition to integrate superior resources and jointly promote the development of the new energy industry alliance. Initially, our Beijing New Energy Automobile Industry Coalition was founded by more than a dozen companies. However, after the establishment of the alliance, the number of members of the alliance exceeded the number of more than a dozen companies. The biggest difference between us and other new energy industry alliances is that we are a registered association. On this basis, we have established an expert committee and four chief experts, including Chen Xuanshi, Sun Hongchun, and two directors of our institute. Under the expert committee, there are seven expert groups, including management systems, electronic control systems, and drive systems, which provide a professional R&D team for the research and development of new energy vehicles.

In my opinion, the role of Beijing New Energy Automobile Industry Alliance includes several aspects. First, it is a product of an era. Without the country’s strong support for new energy vehicles, there is not the enthusiasm of the whole society and there is no such situation. With regard to environmental pressure, there will be no such alliance. It should be said that many factors have contributed to the establishment of this alliance. Second, the original intention of the Beijing New Energy Vehicle Industry Alliance was to integrate innovation and all resources to develop new energy industries; Third, our alliance has built a platform. First of all, this is a research and development platform. Our institute is a national research institute and is open to the inside of the alliance. Second, this is the channel and bridge between the business and the government. At present, the cooperation between our alliance members is very close. We will organize members of the coalition to discuss the cutting-edge technologies of new energy vehicles, issues that need to be resolved urgently, and do some special discussions and technical solutions. As the Secretary-General of Beijing New Energy Automobile Industry Alliance, I hope that the Alliance will do more practical things for members, let the alliances share resources with each other, learn from each other, develop together, and achieve a win-win situation. This has several advantages: First, everyone uses the best technology; Second, shortens the development cycle; Third, Maintain unique intellectual property rights, protect technical resources from the brand; Fourth, transfer cost pressures.

For members of the industry alliance, after the product is developed, the developer is the supplier. Whoever develops and supplies, and who can develop it exclusively will be able to supply it exclusively. In the development of new energy vehicles, we develop products through alliances. For example, the buses and sanitation vehicles we are currently developing are jointly developed by Beijing Institute of Technology and Beiqi Foton. In addition, in terms of battery technology, battery manufacturers and battery manufacturers within the alliance can supply other new energy vehicle development companies. Everyone can communicate and communicate with each other, which is more conducive to cooperation between enterprises.

Our Beijing New Energy Automobile Industry Alliance also frequently exchanges and cooperates with other new energy automobile industry alliances. Our alliance has its own publications. The “Beijing New Energy Auto Industry Alliance” is the word of He Guangyuan. It is now a bi-monthly publication and it has gone through six issues. And we have a budget every year. At present, Futian comes to the budget.

Gasgoo.com: What role does Beiqi Foton play in this alliance? What role has played in the current development of Beijing's new energy automotive industry?

Zhao Jingguang: In the Beijing New Energy Vehicle Industry Alliance, Beijing Automobile is the core and Futian is an OEM. The chairman of Beijing Auto is the chairman of the alliance, the chairman of Futian is the standing vice chairman of the alliance, and I am the secretary general of the alliance.

We have a lot of development results this year. We have developed two tons of electric vehicles, eight tons of electric vehicles, and 16 tons of electric sanitation vehicles. In terms of taxis, 50 sets of pure electric taxis were mass-produced and will soon be available to the Beijing Taxi Group, which will then be operated at Yanqing.

So far, Futian is the most market-oriented among all new energy automobile companies in China. In the market, the Futian New Energy Vehicles operated are the most, and the sales volume is also the most. Since we were the first to begin mass production of new energy vehicles, we started mass production before the country had a subsidy policy, and the cars produced were all purchased by individuals. In this regard, I have an important point: The new energy vehicle can not develop, the key is the degree of recognition of the entire society. Relying solely on government subsidies will be fine in the short term, and it will not be feasible if this is not the case. For example, Beijing has 30,000 buses, one for 500,000 and 600,000. Is the government able to afford it? In this respect, the experience of our Foton Motors proves that even if there is no government subsidy for the development of new energy vehicles, it can be developed, but it may be harder and the entire industry develops slowly. We are also producing new energy buses for Taiwan, before selling them to 75 Taiwan, and this year we have sold 75 more, all sold at normal market prices, and they are operating quite well. I think that as long as new energy vehicles can operate well in Beijing, they can operate well in the world. Because Beijing has the most serious traffic jams, it also has the highest requirements for the safety and reliability of automobiles.

Gasgoo.com: Will Beiqi Futian plan to adjust its new energy strategy in the future?

Zhao Jingguang: New Energy is a strategic business of Foton Motor and a long-term development plan. All models that Futian will produce in the future will adopt different new energy solutions according to different situations. For example, dozens of tons of heavy trucks, we may use hybrid power. In the development of new energy technologies for buses, especially buses, electric vehicles will be the mainstay.

At present, we have built a new energy vehicle factory in Guangzhou and have already started construction. It will be completed and put into operation next year. On the other hand, the energy-saving and emission reduction of traditional energy vehicles is also a very urgent issue, and the development of new energy vehicles must be taken into consideration. I am worried that the development of the new energy automobile industry in the future will return to the old model of the development of China's automobile industry. All companies will blindly enter this market, and then gradually eliminate the integration, which will lead to market chaos and low-end competition, excessive consumption of resources.

Gasgoo.com: At present, the 12th Five-Year Plan also regards new energy as one of the key support areas. How do you think you should seize this opportunity to make the Beijing New Energy Vehicle Industry Alliance bigger and stronger?

Zhao Jingguang: During the 12th Five-Year Plan period, we have to increase the vehicle production by 20%, but it is still difficult to achieve this goal. To accomplish this goal, we must develop new energy buses and small utility vehicles on the one hand, and actively export new energy vehicles on the other. At present, apart from Taiwan, Futian New Energy Bus has already begun trial operations in the United States, the United Kingdom, Poland, Thailand and many other countries. Since most countries have already reached the Euro 5 emission standard, domestic engines have not yet reached Europe. Five emission standards, can only purchase foreign engines.

At present, we are starting from buses, sanitation vehicles and taxis as the focus of new energy vehicles. We mainly consider several reasons: First, the pressure on the urban environment is large, and automobile exhaust pollution basically accounts for 60% to 70% of the urban air pollution sources. Second, the new energy public transport system is conducive to enhancing the government image. Thirdly, for large cities, the construction of social supporting infrastructure is easy to concentrate, and the financial status of the government is also relatively good. The support for the new energy public transportation system is relatively strong. According to our statistics, the operation of new energy vehicles, especially pure electric vehicles, is very poor throughout the country, while the use of hybrid vehicles is relatively good.

So at this stage, I think there are two misunderstandings. The first misunderstanding is that at present we are vigorously advancing the electrification of new energy vehicles and excluding other technologies. I do not agree with this proposal. I think that the development of electric vehicles at this stage is only suitable for operation in a few cities, and it cannot be widely used. Therefore, this industry cannot be industrialized within at least ten years. First of all, the cost of electric vehicles cannot be significantly reduced within a decade. This is the biggest constraint, because to form a big industry must be dominated by personal consumption. Second, the speedup technology and charging facilities of electric vehicles cannot be improved in the short term. Therefore, if only a single technology line such as electric vehicles is supported and other technology lines are excluded, then new energy vehicles cannot be industrialized after 10 years. Therefore, I believe that different new energy technologies should be promoted according to different stages of development. For example, at this stage, it should focus on hybrid technology.

The second misunderstanding is that one-sided emphasis on independent research and development. Emphasizing that independent research and development is correct, but if the issues of independent innovation, independent brands and independent intellectual property rights are all absolute, it will hinder the development of this industry. I think that China's new energy vehicles and foreign new energy are not at a starting point. If we are blind and proud, we will only increase the gap between us and foreign countries. For example, no domestic companies can produce battery separators that meet quality standards. They can only be used as monomers, and the separators need to be completely imported. At present, I think this is a huge opportunity. If we cannot seize this opportunity, it will lead to the backwardness of traditional vehicles and new energy vehicles.

If our new energy auto industry only depends on the government to increase support, it will only cause waste of resources. If the entire market emphasizes self-development and the exclusion of foreign technologies, it will aggravate market chaos. Because cars are more of an application technology, why not use advanced technologies? Why not integrate innovation? Japanese people call this situation reverse engineering. Japan’s auto industry is very advanced. We should learn from advanced technology companies when we are developing new energy automotive industry.