Caixin
Aug 01, 2019 07:59 PM
BUSINESS & TECH

BP, Didi Jump on Electric-Vehicle Charging Bandwagon

A new-energy vehicle charging station in Shanghai in July. Photo: VCG
A new-energy vehicle charging station in Shanghai in July. Photo: VCG

Leading car services firm Didi Chuxing and global energy giant BP PLC said they will form a joint venture offering electric-vehicle (EV) charging services, joining a recent flurry of similar ventures aimed at tapping Beijing’s aggressive plans to promote new-energy vehicles.

China is the world’s largest car market, and has also become the top market for new-energy vehicles thanks to a wide range of government incentives and directives for both automakers and consumers. Lack of infrastructure like widespread charging stations has been one of the obstacles holding back the industry, though that is slowly changing with new ventures like the one between Didi and BP.

As part of their tie-up, BP’s first China-based car-charging site in the southern city of Guangzhou has been connected to an open automobile platform operated by Didi, the Apple-backed company that is China’s equivalent of Uber. That station will be moved into the joint venture, and the new charging network will scale up significantly after the venture is formed, the pair said on Thursday.

“We look forward to combining our strengths to create a robust EV charging network for China, promote the growth of the new energy automotive industry, and provide better experience for car owners across the country,” said Didi CEO Cheng Wei.

Didi operates an open automobile platform providing services such a vehicle charging to a wide range of vehicle-related companies including fleet operators, automakers and energy partners. The company said it currently has 600,000 EVs operating on the platform, making it the world’s largest operator.

“As the world’s largest EV market, China offers extraordinary opportunities to develop innovative new businesses at scale and we see this as the perfect partnership for such a fast-evolving environment,” said Tufan Erginbilgic, BP’s downstream chief executive. “The lessons we learn here will help us further expand BP’s advanced mobility business worldwide, helping drive the energy transition and develop solutions for a low carbon world.”

The venture would mark the latest in a growing list of such tie-ups announced this year, as operators seek to tap the growing number of EVs on the road. Beijing has offered a wide range of incentives, from the easier availability of license plates to government rebates, to promote the technology in a bid to clean up the country’s air and create cutting-edge technologies that can be used at home and abroad.

One of the most recent similar joint ventures saw the pairing of two other giants last month, bringing together real estate giant Evergrande with State Grid Corp. of China, the nation’s largest electric grid operator. Last month also saw German car giant Volkswagen set up a similar charging venture with three major domestic vehicle makers.

New-energy vehicle sales in China surged by more than 60% last year to 1.25 million units, with 99% of the world’s 425,000 e-buses now operating on Chinese city streets.

Despite the government’s success in promoting such vehicles, it is having a tougher time encouraging the matching infrastructure for charging. Policymakers largely hoped that EV charging points could piggy back on the country’s network of 100,000 or so gas stations. But so far only around 50 gas stations have EV charging facilities, Zheng Jiatu, the deputy secretary of the China Electric Vehicle Charging Technology and Industry Alliance (CCTIA), told Caixin earlier this year.

Contact reporter Yang Ge (geyang@caixin.com; Twitter: @youngchinabiz)

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