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Low-speed electric vehicles could reduce China's demand for gasoline and, in turn, impact global oil prices, according to a new issue brief by an expert in the Center for Energy Studies at Rice University's Baker Institute for Public Policy.
"Low-Speed Electric Vehicles: An Underappreciated Threat to Gasoline Demand in China and Global Oil Prices?" is authored by Gabriel Collins, the Baker Botts Fellow in Energy and Environmental Regulatory Affairs at the Baker Institute.
Innovation - Silicon - Valley - Buzzword - Discussions
"Disruptive innovation is typically a Silicon Valley buzzword and not one commonly associated with discussions of gasoline markets," Collins wrote. "Yet the past several years in China have seen the emergence of a potential disruptor: low-speed electric vehicles. These little vehicles typically lack the aesthetic appeal of a Tesla, but they protect drivers from the elements better than a motorcycle, are faster than a bicycle or e-bike, are easy to park and charge, and, perhaps most endearing to emerging consumers, can be purchased for as little as $3,000 (and in some cases, less)."
The International Energy Agency estimated there were 4 million low-speed electric vehicles in China as of midyear 2018, representing about 2 percent of the country's passenger cars, Collins said. Low-speed electric vehicle sales there appear to have slowed in 2018, but manufacturers still sold nearly 1.5 million of them, roughly 30 percent more units than conventional electric vehicle makers did.
Government - Regulations - Sector - Unfold - Sales
"Depending on how proposed government regulations of the sector unfold in 2019 and beyond, sales could rise significantly as low-speed electric vehicles penetrate deeper into lower-tier markets where motorcycles and bicycles remain the prevalent means of transport, as well as into the increasingly crowded urban areas where space is at a premium and many residents still cannot afford larger vehicles," Collins wrote.
If a million low-speed...
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