Mini EVs Could Be An Important Step In The Transition To Electric Mobility
When more affordable smartphones became a reality some years ago, they led to a complete revolution in the access to telecommunications and financial services sectors. Some of the major players in this revolution were very basic and affordable phones from some Chinese companies. Access to these phones enabled a large population on the African continent, for example, who had never had access to the traditional banking services from the old brick-and-mortar-only banking days to be included in the critical financial services economy via mobile phones. These people could now use the telecom services to communicate with customers and also take part in market places via SMS, WhatsApp, and other social media marketplaces and platforms, and also send and receive payments via mobile wallets.
A lot of these phones were very basic, but for the price they allowed more people to communicate and transact. A lot of memes were generated about these types of phones, and these memes became hot topics in circles of people who could afford much better and more premium phones. Some people who owned the simple smartphones would at times feel shy to show them in public lest they get on the receiving end of some of the popular jokes, which is a shame, really.
Fast forward several years to this day, we now see that a lot of these phones have gone through several iterations and now boast some pretty impressive specs. That’s because the manufacturers of these phones that literally sold millions of these phones over the years kept improving them in line with technological advancements in the sector. Now, a lot of these phones have very impressive cameras, storage, and other cool features. On a continent with high unemployment, some of the youth have been able to make a living online using these affordable smartphones to make content on platforms such as YouTube and others. Some users of premium phones may have had a laugh about these phones in the early days, but these phones have had a transformational impact on the continent and in other places.
I think the mini EVs coming from China could have a similar effect. In a market that has traditionally low volumes of sales of brand new cars, most of the major players in the traditional auto sector would not necessarily prioritize a lot of these markets on the continent. One of the major reasons for this is that most of the people in these markets cannot afford to buy the type of brand new cars offered by the traditional big players, just like they could not afford the premium mobile phones. An equivalent of the more affordable basic phone is needed again, and this time in the form of a basic and more affordable automobile. The mini EVs could help kickstart this journey.
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The levels of motorization on the African continent are very low. Only a handful of countries have motorization rates above 100 vehicles per 1,000 people. The majority of countries have rates below 50 passenger vehicles per 1,000 people. To put this into perspective, South Korea and Germany have rates above 500 passenger vehicles per 1,000 people. The US has an even higher rate that is closer to 800 vehicles per 1,000 people, according to a study by Siemens Stiftung. The availability of more affordable basic small city EVs, in conjunction with more sustainable mass transit options, could have a similar transformational effect as the one seen in the telecom and mobile money space. But how can we get there? We have to start somewhere, offering what is practically possible with today’s technology at a price tag that the majority could afford, along with innovative financing models similar to the models that catalyzed the adoption of small home solar systems and other pay-as-you-go services.
The current generation of the Wuling Hongguang Mini EV has inspired other small vehicles that could be the “basic phone” equivalent to lead the transformation of the mobility sector, and increasing access to critical transport services.
Some of the feedback and comments on some forums, as well as from some of our readers, focuses on how these mini EVs are not “real cars” and that they are probably not safe. But just as with the basic phones, it’s a process. They will evolve and get better over time, and in fact they are already getting iterations and updates at a pace faster than the traditional facelifts and upgrades in the traditional auto industry. The new Wuling Air / MG Comet is a step up from the original Wuling Hongguang Mini EV that was released just 3 years ago. The MG Comet has more safety features, airbags, a better sound system, and other smart features. Building on this early success of the Wuling Hongguang Mini EV, the SAIC–GM–Wuling joint venture has recently launched the larger Wuling Bingo that starts from $8,682. That’s quite a reasonable price for a decent 5-door car with a 17.3 kWh battery and a 30 kW (41 hp) motor.
Given what we saw from the Hongguang Mini EV-inspired plethora of mini EVs in China, we will probably see more vehicles launching soon in the same category as the Wuling Bingo. There is already the Leap Motor T03, as well as the all new BYD Seagull in a similar segment, and they are much better vehicles, according to some reviews. We will soon have quite a selection in this $10,000 small city EV category, and just like the cheaper smartphones, the small EVs will get better and better. The BYD Seagull is already in a different class in terms of quality, but its price tag of around $10,700 already makes it cheaper than an equivalent ICE vehicle such as the Honda Fit. Given the low maintenance costs and operational costs associated with EVs, it has already lightened the burden of ownership for families with less disposable income. This will allow more families to be in a position to own decent vehicles.
As competition intensifies in the Chinese BEV market and supply chain constraints ease, it is perhaps the best opportunity to accelerate plans for exporting these more affordable vehicles and offer a much needed option to more families around the world, especially in some developing markets. Already the Wuling Air is assembled in Indonesia, and also now in India as the MG Comet. One of our readers, Udi Shomer, alerted us in the comments of one of our articles that the Wuling Hongguang Mini EV will go on sale in the Philippines beginning in June. He mentions that it will be priced from $12,600 (php 699,000). A look at the website shows that the Macaron and Gameboy editions of the Hongguang Mini EV will be offered in the Philippines.
Some companies have already started to independently ship the Wuling Mini EV to some African countries. Just like with the early basic and more affordable mobile phones, these mini EVs will get better and better and lay the foundation for larger and better compact EVs that will also be more affordable for local consumers to buy. It will start with the Wuling-style mini EVs, but build up to the more spacious Wuling Bingos and the BYD Seagulls eventually.
If demand picks up, it may be a good idea to assemble some of these on the African continent, including the larger Wuling Bingos, Leap Motor T03, and then the better BYD Seagull and BYD e2 types of vehicles. High volume assembly of these types of vehicles could revive the vehicle assembly sector in a lot of markets on the African continent. This will help create much needed employment opportunities across the value chain, including the associated downstream industries. These small city EVs could potentially address two big issues:
1. Increasing access to mobility as more people will now be in a position to own and operate these kinds of vehicles from a cost of “refueling” and maintenance point of view.
2. For the “larger” small EVs like the BYD Seagulls and the e2, these could displace the shiploads of used ICE vehicles that dominate vehicle imports on the continent, and due to their old age end up burdening owners with high servicing and maintenance cost all too frequently.
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