What Bottlenecks Still Need To Be Overcome When New Energy Vehicles Accelerate Their Entry Into The Rural Market?

Buying a new energy vehicle is now very cost-effective, with discounts of several tens of thousands of yuan. The car is environmentally friendly, has good range performance, and is economical. Recently, Cao Fuping, a villager in Guangshun Town, Changshun County, Guizhou Province, bought a Geely Galaxy L7.
According to a survey conducted by Xinhua Perspective reporters, with policy support, new energy vehicles are accelerating their entry into the rural market. However, in some regions, there are still issues such as incomplete charging station facilities and the need to improve the adaptability of vehicle models. It is still necessary to accelerate the construction of charging facilities, enrich rural vehicle models, and improve support policies to assist new energy vehicles in rural areas.

New energy vehicles accelerating towards the rural market

Walking in many rural areas, one can occasionally see new energy vehicles with green tags "swish" past.
Entering the charging station in Fuhuan Town, Qijiang District, Chongqing, owner Liu Gang is charging his Jihu car. Last year, Liu Gang spent more than 220000 yuan to buy this car. It only takes over an hour to charge 80% of the battery, with less than 1 yuan per kWh of charge, which is convenient and affordable. The driving experience of electric cars is also great, "Liu Gang said.
Ye Peng, Deputy General Manager of State Grid Chongqing Qijiang Power Supply Company, told reporters that in 2022, the company invested 300000 yuan to build a charging station in Fuhuan Town; After the charging station was put into operation, the number of new energy vehicles in the town has gradually increased to over 40, and many villagers are still continuing to purchase new energy vehicles.
In recent years, a series of policies have been introduced to encourage new energy vehicles to go to rural areas. In July 2020, the Ministry of Industry and Information Technology, the Ministry of Agriculture and Rural Affairs, and the Ministry of Commerce jointly issued a notice requesting the organization of new energy vehicle activities in rural areas. In June this year, the Ministry of Industry and Information Technology and other ministries launched the 2023 New Energy Vehicle Campaign to the Countryside, which will continue until December this year, with a total of 69 new energy vehicle models participating.
Xie Guang, Senior Director of the Strategic Planning Department of Changan Automobile, said that 7 vehicles from Changan Automobile were selected for this year's new energy vehicle to the countryside catalog. In order to increase sales, the company has launched multiple preferential policies, such as offering a discount of 12000 yuan for the best-selling Mercedes Benz E-Star model, and a direct reduction of 30,000 yuan for the other model before providing a lifetime warranty for the "three batteries" (motor, battery, and electronic control).
Accelerating the improvement of charging infrastructure also helps pave the way for new energy vehicles to go to the countryside. Data shows that in 2020, the number of individual charging stations installed by residents in Qijiang District, Chongqing was only 24, with a new increase of 515 households in 2022 and 586 households so far this year. 86% of townships in Guizhou have built charging facilities, and Chongqing is expected to achieve full coverage of all township charging facilities by 2025.
According to data released by the China Association of Automobile Manufacturers, the sales of new energy vehicle models in rural areas increased by 80%, 169%, and 87% year-on-year in 2020, 2021, and 2022, respectively, driving the cumulative sales of over 4.1 million new energy vehicle models in rural areas. The industry expects that the sales volume of new energy vehicles going to the countryside this year will continue to rise.

Popularization still needs to overcome three obstacles

Despite the continuous increase in sales of new energy vehicles in rural areas, the penetration rate in rural areas is still relatively low. According to data from the National Passenger Car Market Information Joint Conference, in March this year, the penetration rate of pure electric passenger cars in counties and townships was 16%, while the penetration rate of plug-in hybrid passenger cars in counties and townships was 8%.
Industry insiders believe that in order for new energy vehicles to enter the "fast lane" when going to the countryside, multiple problems still need to be solved.
——The charging facilities need to be further improved. The reporter learned through interviews that the current rural new energy vehicle market is still in the early stage of popularization, and the construction of charging facilities in rural areas is still relatively lagging. There are problems with low social investment willingness, difficult profitability, and difficult equipment maintenance in the construction of charging piles.
There are too few charging stations and they often need to be found, "said a new energy car owner in Longshan Town, Longli County, Guizhou Province. Local public charging stations are often unusable and it is common to run 10 to 20 kilometers for charging. Zhang Le, a resident of a township in Chongqing, told reporters that he once wanted to buy a new energy vehicle, but due to concerns about inconvenient charging, he ultimately chose a gasoline-powered vehicle.
——The vehicle model and price should be more suitable for the needs of rural consumers. Rural residents have a high sensitivity to price, with a considerable number of people inclined to purchase new energy vehicles worth less than 70000 yuan. Every year, small cars and micro cars are also the main types of vehicles used in rural areas.
Some rural residents prefer affordable elderly commuting vehicles. Wang Ping, the village branch secretary of Haima Kong Village in Xiuwen County, Guizhou Province, said that almost every household in the village has elderly commuting vehicles. "Although elderly commuting vehicles have safety hazards, they are indeed cheap and have a low threshold for use
According to the interviewed car salesperson, some micro new energy vehicles are selling quite well, but currently, there are relatively few new energy vehicles that can balance usage scenarios such as rural transportation and agricultural production.
——The sales service system needs further improvement. The reporter learned that the traditional fuel vehicle dealer system is deeply rooted, and generally, there are 4S stores or dealer channels in county towns. However, new energy vehicles often adopt online booking and new direct sales models, and the dealer system of car companies in county towns is not perfect, which leads to underdeveloped new energy vehicle finance, insurance, second-hand cars, after-sales, maintenance, and other businesses.

Take multiple measures to unblock the "bottleneck"

Industry experts believe that compared to cities, the rural new energy vehicle market will still be a blue ocean. According to the "Research on Electric Vehicle Travel in Rural Areas of China" released by the China Electric Vehicle Hundred People Association, it is expected that by 2030, the number of electric vehicles per thousand people in rural areas of China will be nearly 160, with a total number of vehicles exceeding 70 million, and the market size may reach 500 billion yuan.
Xu Haidong, Deputy Chief Engineer of the China Association of Automobile Manufacturers, suggested that continuous efforts be made to improve public charging facilities, enrich rural vehicle models and support policies, and accelerate the assistance of new energy vehicles in rural areas.
Firstly, we will focus on building public charging facilities. The relevant person in charge of State Grid Chongqing Electric Power Company suggests prioritizing the allocation of public charging facilities in county-level and township enterprises, commercial buildings, transportation hubs, and other places. At the same time, we will accelerate the transformation of charging facilities construction conditions in existing rural residential communities according to local conditions, and implement the requirements for the construction of charging infrastructure in new residential communities.

In rural areas, there are mostly 'one household, one courtyard' residential forms, and we can actively explore the integrated charging mode of 'photovoltaic+energy storage+car charging', "Xie Guang said. The reporter's interview found that this model has been implemented in scenarios such as highway service areas, but it is still rarely applied in rural residents' homes.
Secondly, we should accelerate the enrichment of the supply of rural products. Xu Haidong suggests encouraging new energy vehicle companies to develop more economical, practical, and marketable models tailored to the characteristics of consumers in rural areas, especially products such as micro trucks, micro trucks, and light trucks. Given that rural consumers do not have high requirements for range, they can reduce the number of batteries carried to reduce costs and prices.
In addition, we need to guide new energy vehicle companies to sink into sales and service networks. Associate Professor Lin Yun and others from Chongqing University suggest guiding car companies and third-party service enterprises to accelerate the construction of joint business outlets in rural areas, establish a supporting after-sales service system, regularly carry out maintenance and after-sales service activities in rural areas, and provide emergency rescue services.