Changan Automobile, a major Chinese automaker with state-owned background, has historically focused on traditional fuel vehicles. However, recent developments suggest a bold shift in its strategy. Reports indicate that Changan is planning to phase out all fuel-powered vehicles by 2025, redirecting its efforts entirely toward new energy vehicles (NEVs). This move has sparked discussions among industry experts and netizens, who are debating whether this is a visionary transformation or an overly aggressive gamble.
At the recent New Energy Strategy and Product Launch Conference in Beijing, Zhu Huarong, President of Changan Automobile, officially introduced the “Shangri-La Project,†signaling the company’s commitment to the NEV market. According to the plan, Changan will invest over 10 billion yuan over the next eight years into developing new energy platforms, batteries, and electronic control systems. The company aims to complete three dedicated new energy platforms by 2020 and stop selling fuel vehicles entirely by 2025.
This timeline is considered extremely ambitious, especially compared to other countries' plans. For example, several European nations have set targets between 2025 and 2040 for phasing out internal combustion engines. Meanwhile, China's government is still studying the feasibility of such a transition but has not yet announced any official timetable.
Industry analysts are skeptical about the feasibility of Changan's plan. Some argue that the company lacks a clear roadmap for implementation and has not yet outlined a phased approach. In the first nine months of this year, Changan sold around 2.058 million units, making it the fourth-largest automaker in China. However, its new energy vehicle sales were only 35,000 units, accounting for just 1.7% of total sales. Transitioning fully to NEVs in just eight years presents significant challenges, especially given the current infrastructure and technological limitations.
A mid-level executive at Changan told *Caijing Weekly* that while the company intends to stop selling purely fuel-based vehicles, there is currently no concrete schedule for when this will happen. Additionally, officials from Changan’s Power Research Institute confirmed that traditional fuel vehicle development is still ongoing, suggesting that the transition may not be as swift as announced.
Experts in the automotive industry have criticized the plan as unrealistic. One industry analyst noted that the automotive supply chain is complex, and no single company can handle all aspects of production independently. Moreover, battery technology and charging infrastructure are still evolving, and it remains uncertain whether they will be ready to support a full-scale shift to NEVs by 2025.
The “double points†policy, introduced by the Chinese government in September, also adds pressure on automakers to increase their NEV sales. By 2025, Changan would need to reach nearly 100% new energy vehicle sales, which is far beyond the industry average. This ambitious target highlights both the risks and opportunities of Changan’s strategic shift.
Despite these challenges, Changan’s decision to pivot toward new energy reflects a broader trend in the automotive industry. As competitors like Geely and SAIC continue to grow, Changan sees this transition as a way to maintain its competitive edge. Whether this bold move will pay off remains to be seen, but it signals a major turning point in the company’s history.
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