Sieren's China: The long drive to the charging station

Theoretically, China could be a paradise for electric cars. The government in Beijing is in a position to reconfigure the car market so that e-cars are in with a fair chance. Given the pollution problem in the cities, it's under pressure to do so. But political will is one thing; the market is quite another. And it can be treacherous when governments don't go as far as it wants them to go.

But as the case of Tesla Motors has shown in recent days, the Chinese market is still an imperfect one for electric car manufacturers. Its charismatic CEO, Elon Musk, (pictured above) has seen his hopes dashed, with the company selling just 120 cars in China in January. Last year, only 4750 Chinese customers purchased a Tesla, accounting for a mere 15 percent of its global sales.

Is the market or Tesla to blame?

Beijing is investing heavily in electromobility, but Tesla is grappling with specific problems. Anyone buying an e-car in China can avail themselves of generous subsidies, and even more importantly, the requisite infrastructure is increasingly in place.

Last year, State Grid installed new charging stations along a 2900-kilometer stretch of freeway, while a number of major traffic arteries are set to have been made e-car friendly by 2020. The plan is that e-cars will take just 30 minutes to recharge anywhere in the country, so long as they meet Chinese standards.

The trouble is, Tesla's S-Model doesn't. It's incompatible with the charging stations paid for by the Chinese government, whose first priority is obviously to foster the homegrown e-car industry.

But this is where Tesla also needs to take some responsibility for the problems. Last April, the company set out to rival State Grid and installed 800 charging stations in shopping malls, and at hotels and restaurants in over 70 cities.

Customers are unnerved by the different standards. Who would buy an e-car when they don't even know if it will fit the socket at the nearest recharging station? But rather than adapting to Chinese standards, Musk's plan is to install rapid charging points in China where batteries can be fully recharged in just an hour. It solves the problem of limited battery range. But Tesla vehicles are still considered risky.

Tesla cars fail to pass muster

Tesla's next problem is marketing. For the time being, few Chinese have even registered the Tesla brand. The idea of a quiet, unassuming luxury electric car does not sit well with the traditional role of the car as status symbol. While IT millionaires in Silicon Valley might like to show off with innovation, in China a car should be loud and be a well-known brand. For the price of an S Tesla, people with money in Beijing and Shanghai prefer to get a Porsche or an Audi.

Then there's the oil price. When gas is cheap, expensive electric cars become less interesting - plain and simple. Even before the price fell, gas was cheaper in China than in the West. So Musk has to make luxury a major selling point of his brand: Tesla has to become a prestige object like Porsche. But such an image cannot be created overnight and he has to connect to the Chinese network. But Musk is clearly taking the bull by the horns.

Growing competition

The Chinese competitors are gathering pace. If Tesla has not anchored its cars in the luxury segment by the time they catch up, it will be overtaken by the pack. The international competition isn't dragging its feet either.

Apple could also put paid to Tesla's plans if it launches its own e-car by 2020, as has been reported, Of course, Apple is well aware that it will not be able to call the shots in the smartphone market forever. Sooner or later, a Chinese company will become the global market leader. For Apple that means it's time to revolutionize a different market. Whether it will manage to pull this off is another matter.

Tesla's advantage is that it built its car around the battery. Apple's advantage is that it sees a car as a gadget. Regardless of what's inside, it should look good and be user-friendly.

This could appeal to the way the Chinese middle classes think about their cars. If so, Tesla could end up squeezed between Chinese run-of-the-mill e-cars and Apple's exclusive gadget e-cars - and fail to find its own niche.

One of Germany's leading experts on China, Frank Sieren has lived in Beijing for 20 years.