China’s EV architect says investing in Europe is a way forward

HEFEI, China — The man who spearheaded China’s electric car strategy said Wednesday that Chinese investment in the European electric vehicles industry could be a way forward for both sides amid trade tensions.

“I believe the governments [of China and the European Union] are now considering how, through negotiations, they can combine investment together with commodity trade,” said Wan Gang, now president of the China Association for Science and Technology.

Wan was speaking via an official English translation during a livestream of a panel at the World Economic Forum’s “Summer Davos” meeting in Dalian, China. Spokespersons for the European Commission were not immediately available when contacted by CNBC.

Regarding specifics, China’s Ministry of Foreign Affairs referred CNBC to the Chinese authorities “in charge,” according to a CNBC translation of the Chinese. The ministry said China and the EU are each other’s most important trade and investment partners, and that China hoped the EU would keep its trade and investment markets open.

China’s Ministry of Commerce did not immediately respond to a request for comment outside of business hours on Thursday. The Commerce Ministry’s spokesperson told reporters earlier in the day that the Chinese and European working groups remain in close consultations.

The Commerce Ministry had said over the weekend that it was launching consultations with the EU over the bloc’s probe into the role of subsidies in Chinese electric cars. The EU said earlier this month that it would increase tariffs on imports of the vehicles.

“Even though we are not exporting a large number of EVs, perhaps the Chinese companies can try investing in Europe,” Wan said, noting that such funding could create local jobs.

Wan became China’s minister of science and technology around 2007 and is known for spearheading the country’s early push into electric cars.

He said that, when China joined the World Trade Organization in 2001, he had already worked in Germany for about 15 years, including at Audi — and he experienced several periods of oil price volatility.

Wan added that 2001 was also the year when the Chinese government set a goal of developing a “moderately prosperous society,” which would mean every family would soon have their own car.

But fuel-powered vehicles would put pressure on Beijing to ensure a stable supply of gas for consumers, while pollution would increase, Wan estimated at the time.

He claimed that China wasn’t thinking about competing with anyone when developing its electric car strategy, but rather considering its own survival.

The U.S. this year also raised tariffs on Chinese electric car imports amid growing criticism of how Beijing’s policy has overly favored domestic players over foreign companies.

Wan said China asked him to return from Germany and start researching electric cars more than 20 years ago. By around 2010, he said Chinese cities faced extreme air pollution problems, which incentivized a local effort to go electric, starting with buses and taxis.

This year, new energy vehicles — a category that includes battery and hybrid-powered cars — have reached more than a third of new passenger cars sold in China, according to local passenger association data.

However, Wan said that electric car makers still need to do more to reduce drivers’ range anxiety — such as enabling vehicles to know when and where to be charged automatically — and improve safety on the road through driver-assist technology.

He said that electric car development was an “irreversible trend” for the world, noting that “we must be fully determined to move on despite the vicissitudes.”