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Business Trends

Japanese carmakers fall in line readying electrics for China

Mazda is the latest to develop SUV with local partner ahead of stricter rules

Homegrown BYD is the electric-vehicle leader in China.

TOKYO -- Major Japanese automakers are scrambling to roll out electric vehicles in China as early as this year by working closely with partners there to ensure compliance with new environmental regulations.

Fuel cells and other technologies have been Japanese carmakers' focus in developing green offerings. But now, as China actively promotes electrics, they seek to catch up with local and Western rivals by electrifying popular sport utility vehicles.

Mazda Motor is creating an electric vehicle with Chongqing Changan Automobile for a 2019 launch. Changan has taken charge of procurement for such components as motors and batteries, while Mazda is developing the body and other parts of the likely compact SUV. Joint venture Changan Mazda Automobile is expected to handle production.

Starting next year, China will require automakers to have so-called new-energy vehicles account for a certain portion of production and sales. The new rule is also expected to require that batteries used in such vehicles be domestically made. Procurement from such local battery giants as Contemporary Amperex Technology will thus be vital to maintaining a competitive edge.

Mazda has been working on core electric-vehicle technologies with Toyota Motor, targeting U.S. and European releases in the 2020s. But in China, the Hiroshima-based automaker will develop an exclusive model with Changan.

New-auto sales in China rose just 3% on the year to 28.87 million units in 2017, while sales of new-energy vehicles soared 53% to 770,000. The government has been promoting electric vehicles by wooing both suppliers and buyers, with such incentives as priority license plate issuance and subsidies.

Major electric-vehicle makers such as BYD are emerging from within China. And with European and American automakers racing to offer more electric products, the Japanese camp cannot afford to fall behind. China is the world's largest auto market, accounting for a roughly 30% slice of the pie.

Toyota, Honda Motor and Nissan Motor will also focus on SUVs to introduce electrics in China. SUV sales there grew 13% last year, and Japanese automakers have been strong in compact SUVs.

Honda will roll out in 2018 electric versions of the Vezel compact SUV and its sibling model, which together account for more than a fifth of Honda's Chinese sales. Joint ventures Guangqi Honda Automobile and Dongfeng Honda Automobile will pool design and production know-how.

Toyota, meanwhile, plans to launch in-house-developed electrics in 2020. The company is considering the C-HR compact SUV and its sibling product as the base models.

Nissan is developing electric vehicles to be built on the platform of an existing compact SUV with joint-venture partner Dongfeng Motor Group and alliance partners Renault and Mitsubishi Motors

(Nikkei)

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