Power Switch: China Plans to Make Diesel a More Attractive Choice

Silkroad Magazine, January 2013

China now imports about half its oil to cope, in part, with the rising number of cars

Try to sell anything but a small hatchback in Europe without a diesel engine and sales will be limited. But in China, barring a few SUVs and Volkswagen taxis, passenger cars are strictly petrol; only some 10,000 diesel cars were sold in 2009, according to the latest available figures.

Until 1993, China was an oil exporter, but increasing demand, partially fueled by the rising number of cars, means it now has to import about half its needs.  As diesel delivers better fuel economy than petrol, the China Association of Automobile Manufacturers says the government is to offer a subsidy of up to RMB5,000 to purchasers of diesel cars.

High upfront costs and limited infrastructure has meant uptake of alternative energy vehicles has been slow. A government target of one million electric
vehicles on the road by 2015 looks likely to fall way short. “Alternative fuels and propulsion technologies such as plug-in hybrid electric vehicles and hybrid electric vehicles are taking much longer to develop  to maturity than initially anticipated, and [diesel] could provide a stepping stone towards the longer term alternatives,” says Bill Russo, President and automotive consultant of international business consultancy Synergistics.

But implementation will not be easy; diesel supplies are currently geared towards commercial vehicles and its high sulphur content doesn’t suit modern diesel cars.

Obvious winners will be European joint ventures with access to the most
advanced engines. But Roger Gao of Great Wall Motor believes his company
has an advantage over some rival Chinese manufacturers as it, along with Chery, Hawtai and SAIC, is already using diesel engines.

Whether companies decide to go it alone or switch to diesel through technology-sharing with foreign manufacturing partners, the benefits are substantial.

According to Bertel Schmitt, Editor-in-Chief of The Truth About Cars website: “Diesel is a fuelsaving technology that works immediately, not some day, maybe.”

Click here to download a PDF of the article (English and Chinese)

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