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Jul 13, 2019,  by Allianz Partners Business Insights

Clean vehicles: China plans to promote hydrogen cars

Having become a giant in the electric car industry, China is now planning to develop hydrogen-powered cars, or fuel-cell vehicles (FCVs), with a $1.8bn factory in the process of being constructed in the province of Guangdong.

At a time when new models of electric vehicles and related innovations are making their appearance in many areas of the world, China is turning its attention to hydrogen-powered cars. The country’s authorities are planning to produce another type of clean vehicle that runs on fuel cells, as reported by Detroit News.

A convert to hydrogen

In an interview with Bloomberg, Wan Gang, a vice chairman of China’s national advisory body for policy making, openly called for the creation of a “hydrogen society”. The 66-year-old, who is regarded as the father of the national electric car industry, which now enjoys a dominant position in the global market, now believes it is time for his country to move into a new technology.

“We need to move further toward fuel cells,” said the man who two decades ago convinced the Chinese government to invest in electric vehicles. A figure with more influence than government ministers, Wan Gang came up at the time with a winning strategy to boost the electric car market: offering public subsidies to persuade the country’s car manufacturers to get behind electric engines. 

A new direction for China

A result of his efforts, China is now the world’s leading producer of batteries for electric cars and also the largest market for these vehicles, with a million of them now on the nation’s roads. Beijing is well versed in the ways of investing in and developing a technology when it is seen as a national priority and the Chinese authorities can roll out some tried-and-tested methods in promoting hydrogen-powered cars.

The road is set to be a long one, however. While China has copious reserves of hydrogen and has no problems, therefore, in sourcing raw materials, there are only 1,500 fuel-cell cars currently in circulation on its roads. These cars have a lot going for them, however: they charge faster than electric cars and are better suited to long journeys.

New factory

Yet despite these advantages and the involvement of car-making giants such as Toyota, hydrogen-powered cars currently hold little appeal for consumers, one of the reasons for that being high prices. Things could be about to change, with a $1.8bn factory currently being built in the province of Guangdong. It is expected to produce 160,000 cars a year within five years’ time.

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Cover photo credits: Martin Abegglen /Flickr
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