Though far too many sectors of the economy have suffered enormous losses during the coronavirus pandemic, a few are doing alright. One of those is car sales. It’s sort of counter-intuitive—because with everything closed, where can we even go in our cars?—but digging a bit deeper, there are some logical reasons why lots of folks might be dropping cash on a new set of wheels.
With everyone cooped up at home, people have been saving more disposable income than probably ever before, so the money’s there and ready to go. For those who still need a loan, interest rates are at all-time lows. Road trips and domestic travel have largely superseded flying and international travel. And finally, buying a shiny new car just feels good—and we need all the feel-goods we can get right now.
Combustion-engine cars still dominate the market, making up 97 percent of global car sales through 2019. In China, though, electric cars are giving gas cars a run for their money—one in particular, the Wuling Hong Guang Mini EV. Launched in late July, the Hong Guang generated over 15,000 orders within 20 days of its release, and racked up another 35,000 in the subsequent month. At a total of 50,000 orders in under two months, then, it briskly surpassed Chinese orders for Tesla Model 3s in the same period.
So why are Chinese drivers so eager to drop their hard-earned cash on this teeny tiny car?
For starters, it’s not all that much cash, relatively speaking. The no-frills model of the Hong Guang goes for 28,800 yuan (about $4,200 at current exchange rates). That’s less than a tenth of the cost of a Tesla Model 3 (291,800 yuan). Of course, you’re getting a very different car for your money, but Chinese consumers seem to be a-ok with that, especially because the mini electric vehicle meets a lot of their practical needs for getting around big cities.
It doesn’t quite have the sleek, futuristic look you might expect of a new car, with its designers instead opting for a boxy shape to try to maximize—and simultaneously minimize—available space. GM markets the car as “small on the outside, big on the inside.” It’s 9.5 feet long by 4.9 feet wide, and 5.3 feet tall. That’s comparable to Mercedes’ Smart Fortwo, and ideal for squeezing into cramped parking spots on bustling city streets. The car has 12 different storage compartments in the cabin, including a smartphone tray on the dashboard.
Its max speed is 62 miles per hour (100 kilometers per hour), which isn’t quite fast enough for long trips on highways, but works great for moving around a city and its environs. Drivers can go about 105 miles on a single charge, and can monitor and control the car’s battery functions on a smartphone app.
If sales are off to a strong start, they’re likely going to get even stronger; GM’s Chinese joint venture is planning to open around 100 “experience stores” in China to continue to promote the vehicle.
Though the pandemic has thrown a wrench in the growth of China’s middle class, it is nonetheless growing, meaning millions more people per year have the means to acquire possessions like cars. It’s important that electric cars, whether Tesla Model 3s or Wuling Hong Guangs, continue to take over more of this market share; given the state of the climate crisis, putting millions more combustion-engine cars on the road in an already very polluted country would be counterproductive in a big way.
Hopefully once the pandemic has subsided, people will go back to riding public transit. But in the meantime, if we’ve got to buy cars, they may as well be small, practical, and electric.
Image Credit: General Motors