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BYD now focused on fleets for its electric vehicle strategy. Smart move.

February 10, 2012

An analyst friend in China emailed me a few days ago asking if BYD was doing anything with electric vehicles here in the U.S. A colleague of his visited the BYD office building in downtown Los Angeles and found an empty showroom and,  apparently,  no staff,  said the analyst.  As well, consumers still can’t buy the e6 electric crossover vehicle in China, and there are no F3DM hybrids are in dealerships either, he said.

The BYD  www.byd.com headquarters does look a bit vacant from ground level. The first floor has all glass walls, presumably to show off vehicles on display. But there’s nothing to see.   I’m pretty sure there is staff working away in that building.  But they are hidden away on the upper floors, out of sight.

That would also be an appropriate description of BYD’s business plan where electric vehicles are concerned.  Like signs of activity in the Los Angeles headquarters, BYD’s business plan for electric vehicles is hidden.  But if you look at BYD’s recent actions, and hey, ask their public relations guy here in the U.S., the automaker’s intentions become pretty clear.

BYD isn’t opening dealerships here in the U.S., or offering electric vehicles to consumers in China, because consumers are not its target market for electric vehicles anymore.  Fleets are.  Micheal Austin, BYD’s VP and spokesman here in North American confirmed that in an email exchange.  “We are now fully focused on fleet sales in the U.S. for BYD’s K9 electric e-Bus and e6,” he said.

BYD's headquarters in LA looks kinda deserted. The first floor showroom is empty though offices upstairs have people in them.

The company recently put a bid in for a two-bus contract with the Chicago Transit Authority, and will make a bid for contract for 30 zero-emission buses for the Los Angeles Metro Transit Authority, said Austin.  BYD’s K9 electric bus has also gotten some use over here in the U.S. One of the buses is being used as a shuttle bus at LAX (the main Los Angeles Airport) by Hertz, the global rental car giant.   The pilot test is going well, Jack Hidary, head of global EV development at Hertz Corp.  www.hertz.com  “The reaction from our customers has been great,” he said.  “The drivers like it; it has been a very positive experience.”

Though Austin wouldn’t come right out and say it, fleets are BYD’s main focus for electric vehicles in China too.   “BYD has had great success in the commercial/government sectors” in China, he said.  “Our bus orders are fantastic. But I can’t share exact numbers.”

BYD had about 300 K9 e-buses on roads in China at the end of the year, he said, adding “You may see ten times that in the next 12-18 months.”

Hertz is very happy with its BYD e-bus, said Jack Hidary, head of global EV deployment at Hertz.

The e6 electric crossover vehicle is also aimed mainly at fleets, he indicated. Shenzhen already has some (at least 50, not sure of the most recent figure) e6 in a taxi fleet. All together, BYD’s e-Bus have logged more than 1.6 million fleet miles; the taxis have logged more than 5.9 million fleet miles, Austin said.

Hertz has a several e6 taxis operating in Shenzhen, in southern China.  Hidary said they have been getting 185 miles per charge.  “Great range,” he said.  “We hope to expand the relationship.”

Hertz has been getting 185 miles per charge from its e6 taxis in Shenzhen, said Jack Hidary, head of global EV deployment at Hertz.

So there you have it. The reason you aren’t seeing lots of BYD electric vehicles being made available to consumers, either here or in China, is that consumers are no longer BYD’s target market.  The commercial sector i.e. fleets is.  Smart move.   I’ve said (and also written) that fleets are the best use for pure electric vehicles. The not so smart thing about BYD’s strategy is the secretiveness that seems to envelop the company’s business plans.  Everyone is still wondering why BYD hasn’t opened dealerships here in the U.S., or sold any e6 cars in China. They think it is a failure. (The fleet plan could fail, too. But at least it is doing something!)

Of course, there is another BYD vehicle that some are still wondering about. That is the F3DM hybrid car. It is pretty outdated looking now, and probably wouldn’t find a market in China anyway. But it is getting some use in a fleet here in the U.S.   The Housing Authority of the City of Los Angeles (HACLA) started using about 10 F3DMs in its fleet in late 2010. http://www.hacla.org/byd-and-the-hacla-launch-electric-vehicle-testing-program/  (I visited HACLA and rode around in an F3DM with an employee. I was not impressed with the car’s fit and finish….). That initial contract was extended for one year, with seven cars, starting Jan 1, 2012.  According to a press release, HACLA’s F3DM fleet travelled more than 37,000 miles in last year in the hybrid cars and achieved 76% fuel savings.

BYD has one another business line, too, that isn’t getting much press. It is selling its batteries as storage systems.  On December 30, 2010 it announced that it had, with the State Grid Corporation of China (one of China’s two huge state-owned utilities)  http://www.sgcc.com.cn/ finished construction of “what may be the world’s largest battery energy storage station.” Located in Hebei province in northern China, the station combines 140 mega-watts of wind and solar renewable energy generation with 36 mega-watts hours of energy storage and a smart power transmission system. That’s straight out of the press release but I didn’t feel like putting it in quotes. Tee hee.

Austin wrote that BYD had about 60 MWH in 10 energy storage stations in service world-wide. “Industrial customers are gaining confidence in this technology,” he said.

Let me harp on a common complaint I have about BYD.  Let some independent testing companies run tests on your technology! Then maybe the rest of us can gain confidence in your technology, too.

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