Car manufacturers are scrambling to build vehicles for a China with more electric cars than ever

The global boom in electrics has turned out to be anything but rosy for Europe’s car companies, which have reported soaring demand for battery-powered cars from China and other places.

In February, Rolls-Royce Motor Cars sold 200 electric cars to Chinese customers in one of its biggest orders ever. At that time, Rolls-Royce signed a $100 million contract with Beijing Electric Vehicle, its state-owned domestic partner, to study electric hybrid and all-electric car models for sale in China.

To be sure, there’s much more to the story than China.

It’s not just that China’s plan to spend $140 billion on electric vehicle research will dwarf any other international competitor. Those advantages are largely due to the huge population of potential customers and the length of time it will take the nation to fully develop its electric vehicles industry. That’s why Rolls-Royce is eyeing China, but the company’s global ambitions are meant to prepare it for when all of China’s cars run on electricity instead of gasoline, as well as China’s potential ambitions to turn over the batteries for its growing electric fleet to Western companies.

The other problem for Europe’s automakers is that their electric-vehicle operations have essentially no affordable Chinese model to offer, despite China’s high growth rate.

According to Xu Hongxu, head of Anshan Automobile Industry Investment, a Beijing-based research and development consultancy, Chinese customers are now lining up in their thousands for access to the Tesla Model S and waiting two years or more for a tariff-free purchase.

“Luxury electric vehicles are the best-sellers right now,” Xu said. “In the fourth quarter last year, almost 100,000 new-energy vehicles were sold, most of them low-end battery cars.”

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