YOKOHAMA, Japan (AP) 鈥� Osamu Furukawa has driven lots of Japanese cars for his business converting classic gasoline-powered models to electric. But his favorite ride is an import: A battery-powered SUV from China鈥檚 BYD Auto.
BYD Auto is part of a that are starting to compete with Western and Japanese brands in their home markets. They bring that Tesla Inc.'s chief financial officer says 鈥渁re scary.鈥�
Furukawa said he ordered an ATTO 3 when it went on sale Jan. 31, for its user-friendly features and appealing price of 4.4 million yen ($33,000) 鈥� or about one-quarter less than a Tesla.
鈥淚t鈥檚 perfect,鈥� Furukawa said in his office in Yokohama, southwest of Tokyo.
Other ambitious Chinese EV exporters include NIO, Geely Group鈥檚 Zeekr and Ora, a unit of SUV maker Great Wall Motors.
Some compete on price. Others emphasize performance and features, putting pressure on Western and Japanese premium brands.
NIO Inc., which has persuaded buyers in China to pay Tesla-level sticker prices of up to 555,000 yuan ($80,000), says its latest SUV goes on sale this year in Europe. The ES6 boasts voice-activated controls and a range of 610 kilometers (380 miles) on a charge.
鈥淲e are very confident the ES6 will compete in this premium SUV market,鈥� NIO鈥檚 founder and CEO, William Li, said in an interview at the Shanghai auto show.
Sales of battery-powered vehicles and gasoline-electric hybrids in , or half the global total.
That was supported by multibillion-dollar subsidies from the ruling Communist Party, which is trying to make China a creator of clean energy and other technologies. That rattles U.S. and European leaders who see China as a strategic and industrial competitor.
Chinese brands are 鈥渟erious competition,鈥� according to David Leah, an analyst for GlobalData.
They have 鈥渕ore competitive battery technology鈥� and can 鈥渁chieve greater economies of scale,鈥� Leah said in an email.
BYD Auto, owned by battery maker BYD Co., in total 2022 sales at 1.9 million vehicles. Half were gasoline-electric hybrids, while Tesla鈥檚 fleet is pure electric.
鈥淲e have a lot of respect for the car companies in China,鈥� Tesla CEO Elon Musk said in a Jan. 25 conference call with financial analysts. 鈥淭hey work the hardest and they work the smartest.鈥�
Chinese brands are developing EVs to compete without subsidies as Beijing shifts the burden to the industry by requiring them to earn credits for selling electrics. Prices start as low as 100,000 yuan ($14,500) for a compact SUV with a 400-kilometer (250-mile) range on one charge.
鈥淭he Chinese are scary,鈥� Tesla CFO Zachary Kirkhorn said on the analyst call.
Chinese EV brands mix research and design centers with factories in China.
Geely鈥檚 Zeekr plans to launch an all-electric sedan and an SUV this year in the Netherlands and Sweden. Its mini-United Nations of Chinese and European designers is in Gothenberg, Sweden, adjacent to Volvo Cars, another Geely brand, while its factories are in China.
鈥淥ur ambition is to be a key player in electrified mobility in Europe within this decade,鈥� said Zeekr CEO Spiros Fotinos, a Toyota and Lexus veteran. With a 鈥渃lear global ambition,鈥� he said, "we鈥檙e looking at the opportunities and right timing for other markets.鈥�
CEO Carlos Tavares of Stellantis, the parent company of Chrysler, Peugeot and FIAT, warned in January that Europe needs a strategy to compete with China's lower prices. European-made electrics cost 40% more than Chinese models, according to Tavares.
鈥淚t鈥檚 a very bleak scenario,鈥� Tavares told German magazine Automobilwoche. 鈥淏ut it doesn鈥檛 have to go that way.鈥�
BYD Auto鈥檚 exports quadrupled last year to 55,916 sedans, SUVs and hatchbacks. Most went to India, Thailand, Brazil and other developing markets. BYD announced a 1,000-vehicle sale last year to Mexico's VEMO for the biggest EV taxi fleet outside China.
State-owned BAIC, headquartered in Beijing, said a dealer in Jordan ordered 1,000 units of its compact EU5 sedan in January. The company said it plans to launch two to three more electric vehicles in Latin America, Southeast Asia and Europe.
What about the United States, the biggest, richest market?
Chinese EV brands are skittish about a sprawling country that demands big investments in dealerships and charging networks, especially while over security, technology and human rights.
鈥淭his is not an easy task," said NIO's Li. 鈥淥ur products and services need to be prepared."
BYD Auto has been in the U.S. market for a decade selling battery-powered transit buses assembled at a factory northeast of Los Angeles. It is 鈥渟till in the process鈥� of deciding whether to sell SUVs and sedans to Americans, the company said in a written response to questions.
Political tensions 鈥渕ake it difficult for a Chinese company to launch, EV or otherwise,鈥� in the United States, Leah said.
its 03 model starting at 140,000 yuan ($20,000). Ora tries to stand out among dozens of fledgling brands by marketing its cars as being designed for women, their body sizes and daily needs.
鈥淭his is a second or third car for a household. It can be used by a wife or daughter to commute to work, to go out with friends or to go shopping,鈥� said Ora's deputy general manager, Tan Jian.
In Europe, BYD Auto has partnerships with dealership chains in Britain, Sweden, Germany and the Netherlands. The company says it also has delivered cars in Belgium, Denmark and Austria. It has a deal with European rental company SIXT that BYD says will lead to sales of up to 100,000 vehicles over the next six years.
In Japan, BYD Auto plans to have 100 showrooms by the end of 2025. Its Dolphin hatchback and Seal sedan are due to hit the Japanese market this year. The company says it also has exported some 4,000 ATTO 3s to Australia.
Furukawa's OZ Co. converts Volkswagen Beetles and other classic models by replacing gasoline engines with batteries and electric motors. Furukawa said he drives his ATTO 3 every day and has gone as far as Osaka, 400 kilometers (250 miles) away.
BYD Auto鈥檚 Yokohama showroom, which opened Feb. 2, is surrounded by dealerships for established brands including Toyota, Nissan, BMW, Volkswagen and Chevrolet.
A married father of one said he looked at Japanese models but bought an ATTO 3 for its roominess and price.
鈥淚 like the ride, and it鈥檚 easy to drive,鈥� said the buyer, who asked to be identified only by his surname, Ohta. 鈥淭here are so many good features.鈥�
Ohta鈥檚 father had a 鈥渘egative reaction鈥� about BYD being from China, which has a history of strained relations with Japan. But Ohta said his job in the electronic games industry has taught him to respect Chinese innovation.
鈥淭hey are coming out with excellent products,鈥� Ohta said. 鈥淚 have respect for the nation.鈥�
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McDonald reported from Shanghai.
Joe Mcdonald And Yuri Kageyama, The Associated Press
