What US and European Manufacturers Can Learn From China Mini Car's Success

What US and European Manufacturers Can Learn From China Mini Car's Success

China’s success with a super-cheap electric vehicle that looks just like an ordinary minicar has surprised many.china mini car The Hongguang Mini EV—made by a joint venture between GM -0.3%, SAIC -0.5%, and Wuling—represents a new direction in the mass market for EVs. Other popular EVs on the European market tend to be over-priced and let down by long-range capabilities that can be eclipsed with ease by even the most basic gasoline or diesel vehicles.

The cheapest Hongguang costs around $5,000—that’s less than it would cost to spec the cigar humidor glove box option on a Rolls-Royce or add Apple CarPlay to a Ferrari.china mini car And despite the fact that it can only go about 25 miles on a charge, it has proved incredibly popular in China. So much so that Wuling is now busy making different versions of the EV, including a forthcoming cabriolet and a long-range version. We got behind the wheel of a Macaron version to see if this super-cheap EV is any good, and to find out what US and European manufacturers could learn from its success.

There’s no doubt that the Hongguang is a great little EV, and its low price makes it a hugely attractive proposition in Europe, where the average annual wage is much higher than in China. But there are a couple of issues that might slow its adoption here, and one is safety. The Hongguang and its competitors don’t have all the safety features you might expect on a small car. They do have some smart seatbelt technology, but no airbags. That means that if you’re involved in a serious crash, you’ll be toast.

Another issue is that the Hongguang isn’t street legal in the United States. Some EV companies are already importing the Hongguang to the US, but unless those importers are producing them in a factory that’s DOT-compliant, or can be registered with the NHTSA as such, you won’t be able to buy a car that can legally drive on the road.

That may not stop people buying them for use in the developing world, where urbanization is continuing at an astonishing rate. And electric bikes, scooters and motorbikes can be even more maneuverable in tight city streets than a Mini EV. So, if the Hongguang and its rivals don’t make it in the developed world, they’ll likely thrive where cost pressures are eating into the margins of big cars. And with more and more of those cars being built by Chinese joint-venture partners, that’s where the future is.