As we wrote last week, it looks like consolidation is not too far off for the country’s fragmented New Energy Vehicle market. Shenzhen-based companies are clearly planning to be in the vanguard of this change, as property developer China Evergrande is teaming up with State Grid Corp to develop a residential charging network. Over the weekend, the other Shenzhen company best known for electric vehicles made clear its ambitions not to be left behind: BYDannouncedit was teaming up with the world’s No. 1 carmaker, Japan’s Toyota, to build sedans and SUVs under the Toyota brand. If only BMW could have such common sense.
According to Yicai Global, Toyota also signed an agreement last week with the country’s main power cell supplier, Contemporary Amperex Technology, the world’s biggest maker of lithium-ion batteries. They will collaborate to come up with more reliable battery systems for NEVs, and technologies for reuse and recycling of batteries.
Toyota is not spoken of in the same breath as Tesla, of course. Its ambitions in electric vehicles have been muted, just as those of the big American and German car giants have, as Chinese startups backed by tech companies have tried to race hard with Elon Musk in the industry. But Toyota has clout, no one should doubt that. It is also spreading its bets, having signed a similar agreement with Guangzhou Auto Corp., with whom Toyota has been serving the country’s car market for nearly two decades.
Toyota is only spreading its bets so far, however. It is staying in the GBA for a reason. This is where the NEV market is going to accelerate the fastest. Watch this space.