NY Times: BYD F3DM could be "Volt with a Wal-Mart Pricetag"
February 20th, 2011 |
In summer 2010, months prior to the much-ballyhooed arrival of the Chevy Volt, BYD's F3DM was already in the hands of the Chinese driving public. According to BYD, close to 10,000 of these extended-range electric cars are now on the roads. On this side of the world, however, even industry insiders have seldom had the chance to kick its tires. So when Brad Berman's in-depth review of the F3DM appeared in this Sunday's New York Times, it prompted some new questions: Who will make up the market for these "cheaper" electric cars? Will the US and Chinese EV markets become intertwined or remain separate?
Where's the Market for a Cheaper Electric Car?
The F3DM is mechanically similar to the Volt, with a 16 kWh battery pack and backup gasoline generator. But with a price that could be as low as $20,000 on American shores (compared to the Volt's current $41,000) Berman speculates that the F3DM could be a "Volt with a WalMart pricetag." But let's be clear: even with the right price the WalMart shopper is probably not the right target for the F3DM.
It's undeniable that lower pricetags will open up a broader market for electric vehicles, but it's important to note that new demand will come from two different buying groups. On the one hand, there's pent up demand among early adopters who yearn for a Volt or Leaf but simply can't afford one. This group is likely to be disproportionately young and risk-tolerant. They might welcome a "starter car" like the F3DM as their first eco ride. On the other hand, you have the cost-conscious mainstream. They are somewhat ambivalent about new technology, but could be won over by lower prices. This is the sweetspot population for WalMart, but could be a tough crowd for BYD to woo.
As I've crudely visualized below, the WalMart shopper usually embraces low-cost technology only after it has been proven in the marketplace. When it's time to convince the last 50% of car buyers to go electric, that WalMart shopper will be vital and Chinese brands like BYD could play a huge role.
Right now, BYD would be better advised to target tech-enthusiasts and tinkerers looking for a rock-bottom price and willing to overlook minor imperfections. BYD could take a page from Toyota's book with the Scion brand, targeting a youthful crowd that wants to customize their vehicle to make a big statement about who they are. These buyers are less invested in existing brands and may have fewer political antibodies to the notion of a Chinese-built car. Of course, they'll have to be mindful of Toyota's own ambitions for a Scion EV.
Will the US and Chinese EV Markets Become Intertwined?
In many ways, they already are. Despite official claims of 10,000 F3DM on the road, BYDinsider.com records only 68 sales in December-January, compared to 49,000 of its gas-only sibling, (which is currently the bestselling car in China). Although much has been made of China dominating the future EV market it's apparent that, like everywhere else, it may take time and concerted effort to woo Chinese consumers. In fact, Chinese buyers may be waiting to see how Western car culture adjusts to the arrival of electric cars. BYD clearly sees the homeland benefits of a play in the US market - as one official put it 'If you make it in the US, you make it anywhere. We definitely will sell more vehicles in China if the US brand is strong.'
Whatever route BYD takes to the US market, the arrival of lower-cost electric vehicles will apply interesting pressures to the market and help broaden the demographic of electric car movement. One thing is for sure, they're gonna need one hell of a marketing team.
[via NYTimes ]Return to blog »