* China aiming for 2 mln capacity by 2020
* Electric vehicle experiment at critical point - analyst
By Laurence Frost and Norihiko Shirouzu
PARIS/BEIJING, March 18 China will save the
electric car, Renault-Nissan boss Carlos Ghosn predicts - and
with it the vision of battery-powered motoring on which he has
staked his credibility.
Ghosn, who has ploughed a bigger share of his companies'
cash into the technology than any other mass-market carmaker,
struck a determinedly optimistic note as he released Renault's
Zoe into a European market notable for its scarcity of
electric car chargers and customers.
Industry investments will be sustained by Chinese plans to
build production capacity for two million electric cars and
plug-in hybrids by 2020, Ghosn said in an interview coinciding
with the first Zoe deliveries to European consumers last week.
"This isn't speculation," Ghosn insisted. "China's decisions
are among the most audacious that have been taken by any
Despite generous subsidies, U.S. and European sales of
electric cars remain far below expectations three years since
the introduction of the Nissan Leaf. That leaves China
as a last redoubt for many believers, despite mounting
scepticism about Beijing's target.
The installation of charging networks is also flagging. Many
of Europe's estimated 20,000 public chargers are concentrated in
Germany. This forced Renault to resort to giving away costly
equipment in France, which still has only about 4,000 public
Renault has introduced three electric models since 2011 and
sold 16,000 of the vehicles last year. Nissan, its 43.4
percent-owned Japanese affiliate, sold 26,973 Leafs - 20 percent
Speaking at a Zoe test-drive event in Cascais, Portugal,
Ghosn gave no objectives for sales or production in Flins, west
of Paris, where the French carmaker has invested in capacity to
assemble 150,000 of the vehicles annually.
"We don't share them," Ghosn said. "We don't want to give
the impression if these targets are not (met) that there is
something wrong with our strategy."
The Renault-Nissan chief has also backed down from an
earlier forecast of a 10 percent market share for electric cars
by 2020. He now says the goal is to beat the adoption rate of
hybrids such as Toyota's Prius, which have taken 15
years to claim about 2 percent of global sales.
But electric cars must catch on much faster, some
industry-watchers say, or risk failing completely.
"The electric vehicle experiment is at a critical point,"
said Barclays Capital analyst Michael Tyndall.
"It needs so many things to align - manufacturers developing
vehicles, companies providing charging infrastructure, battery
makers investing and consumers accepting the cars at such a rate
that everyone in the food chain can make a return."
That's where China comes in, Ghosn says.
Nissan plans to introduce an electric car with Chinese
partner Dongfeng in 2015 and Renault aims to start
local production of a battery model at about the same time.
"China has 16 of the 20 most polluted cities in the world,"
Ghosn said. "They will set the rules so that the consumer buys -
that's how it's going to happen."
China and its state-controlled companies are still showing
strong interest in electric cars. Dongfeng is bidding for a
stake in Fisker, a troubled electric supercar maker. Wanxiang
Group is paying up to $465 million (360 million euros) for
bankrupt battery maker A123 Systems, while BYD is
launching an electric car with Daimler this year.
Forecasting house IHS Automotive, however, sees Chinese
output of only 234,000 pure-electric cars in 2020.
Meanwhile, influential critics "want the industry to shift
towards more realistic solutions", said Yale Zhang, of Shanghai
consultant Automotive Foresight.
The authorities appear to be heeding that message. Ordinary
Chinese-made hybrids achieve 20 percent fuel savings and are
"ready for nationwide promotion", Industry Minister Miao Wei
told a March 8 session of the National People's Congress.
General Motors, BMW, Volkswagen
and Ford are among others to have launched electric cars
with an eye on China and tightening emissions rules in Europe
and the United States, though automakers are increasingly
scaling back plans for pure electric vehicles.
More than 2 billion euros ($2.6 billion) of Renault-Nissan's
4 billion euro investment in electric cars has been accounted
for in previous years' accounts, Ghosn said.
"The important point is that more than half of the
electric-car entry ticket has already been paid," he told
The problem is that sales volumes are still lagging far
behind conventional vehicles.
The zippy Zoe is priced at 20,700 euros, before a 7,000 euro
French subsidy that brings it into line with its petrol
equivalent, the Renault Clio. But that does not include the
battery - rented for 79 euros a month - and a wall-mounted home
charger at 850 euros or more.
Renault has taken about 2,000 orders in six months leading
up to the Zoe's first deliveries, but Ghosn remains sanguine
about its medium-term sales potential.
"I don't think we're ever going to find ourselves in a
situation where we can't respond to demand," he said.