Gaming the Electric Car Chase

As the four front-runners sprint around the track, some favorites could end up in the dust.



Size of the bet: $15 billion by 2020

Strategy: Beijing has set wildly ambitious targets for its car companies, demanding that they put 500,000 electric cars on the road by the end of 2011, three to four years ahead of their U.S. competitors. The country is also luring foreign innovators with cheap manufacturing — in exchange for invaluable intellectual property.

Why it could win: Because it really, really wants to.

Why it might not: Brains. Virtually all the leading battery-development scientists in the world live elsewhere, and China doesn’t hold any of the patents for today’s most cutting-edge technologies.


Size of the bet: $6.8 billion in subsidies for electric and high-efficiency vehicles

Strategy: Japan’s car companies have partnered with local electronics giants, aiming to seize the new market for both batteries and electric cars.

Why it could win: Because it’s winning today. Japan figured out the future of battery-powered locomotion before anyone else: The country’s companies launched the first version of today’s lithium-ion battery and sold 43 percent of them last year.

Why it might not: Japan has a relatively small domestic consumer base and relies on exports — leaving the country at the mercy of Chinese and American trade protectionism, which has proved a stumbling block before.


Size of the bet: $12.5 billion over the next decade

Strategy: Unlike the other big three, South Korea isn’t expending much effort on building hybrid and electric cars — its companies have a single-minded focus on winning the battery game.

Why it could win: South Korea has a record of needling its way into Japanese markets. In 2005, South Korean companies began to crack the Japanese hegemony over consumer electronics such as flat-screen televisions. Industry analysts see a similar future unfolding in advanced batteries.

Why it might not: Japan has a record of figuring these things out first.


Size of the bet: $27 billion in loan guarantees and grants

Strategy: The U.S. government is pumping money into joint ventures between domestic car companies and foreign battery manufacturers. Its stimulus bill also poured billions for battery work into the government’s elite research laboratories.

Why it could win: Because it has to. The United States badly needs a new platform for economic growth. History counts for something, too: Every major battery breakthrough of the last 100 years has originated in the United States.

Why it might not: Have you visited Detroit lately? The American manufacturing base is a thing of the past.

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