International Study from Continental: Chinese Set on More Environmentally Friendly Hybrid and Electric Vehicles

HANOVER, November 21, 2008: Car drivers around the world show a surprising amount of interest in electric cars and in vehicles with hybrid drives and the Chinese are leading the Europeans and other Asian states. Overall, 53.7% of the Chinese were prepared to buy a car with a hybrid drive, 73.4% were even open to buying an electric car. The motivation here was provided both by increasing fuel prices and by environmental aspects. These are the results of a representative survey – the first of its kind - carried out by the international automotive supplier Continental among more than 8,000 car drivers in eight major international markets. "As an automotive supplier and a provider of environmentally friendly drive technologies, this trend represents significant potential," said Dr. Karl-Thomas Neumann, chairman of the Continental AG Executive Board since September 1, 2008.

At the beginning of this year, TNS/Infratest surveyed approximately 1,000 motorists each in China, Germany, France, UK, Japan, Austria, Switzerland and the USA on behalf of Continental AG. The study focused on the motorists' current state of knowledge and opinions of hybrid drive systems, their driving styles and their views on battery-powered cars. 1,008 Chinese car drivers were interviewed from North China (Beijing), East China (Shanghai) and South China (Guangzhou).

Over half of all Chinese drivers (50.2%) feel compelled to modify their driving to save fuel, owing to rising fuel costs. Drivers in the Beijing area are the most environmentally friendly. Here, one in three drivers (33.1%) claims to always or usually modify their driving style as fuel prices increase. Currently, 48.9% of the Chinese do not alter their style of driving at all; this percentage is only lower in Great Britain. "Conventional fuels such as diesel and petrol will be even more expensive in future. The overwhelming majority of Chinese car drivers have become aware of this aspect," explained Dr. Neumann.

The trend of increasing fuel prices raises interest in alternative drive systems, however, according to the study, the familiarity with these systems varies widely around the world. China has a lot of catching up to do here. 81.7% of Chinese car drivers cannot say which types of fuel-saving drives they are familiar with. The most familiar (at 7.5%) are the hybrid drives which combine a gasoline or diesel engine with an electric motor. At 10.9%, the familiarity in Shanghai thus exceeds that in Beijing (8.6%) and Guangzhou (2.7%). The familiarity of purely electrical drives, with an average of 2.7%, is in 3rd place after petrol motors with 3.2%. When Chinese car drivers are asked what occurs to them on the subject of hybrid technologies or hybrid drives, more than one third (34.4%) believe that it concerns a combined electric motor and an internal combustion engine. Only 2.7% mentioned the environmental or economic aspects. Almost half (46.7%) could not say anything at all.

Hybrid drives present significant savings potential, especially in urban traffic. And it is in urban traffic where the vast majority of Chinese car drivers can be found every day. 58.9% of motorists travel less than 30,000 kilometers a year, more than two thirds (72.9%) primarily in urban traffic. "City and short-distance drivers can reduce their energy consumption by more than 25% using hybrid drives, while at the same time reducing CO2 emissions as well," said Dr. Neumann, explaining the advantages over conventional vehicles. "The use of alternative types of drive could really make a contribution to the reduction of pollution in large Chinese cities." Worldwide, 36% will definitely or quite probably buy a vehicle with hybrid drive. Those asked in the growth areas in the Chinese coastal regions went even further in their predictions. More than half of Chinese drivers (53.7%) could imagine buying a hybrid vehicle in the future – after the technology had been explained to them.

At 9.3%, almost every tenth driver in Guangzhou would definitely consider buying a hybrid vehicle. 45.6% of the Chinese would even change their opinion if the state were to provide tax incentives for the purchase of hybrid vehicles. To date, about half of Chinese car drivers (48.8%) presume that environmentally friendly hybrid drives are associated with higher costs compared to conventional cars. Another 32.4% of those questioned believe that the costs would be about the same, should they choose a hybrid vehicle. The Chinese expect an average addition to the purchase price of €4,068 (42,352 CNY), on the other hand, they expect savings on running costs of about €4,134 (43,039 CNY). Drivers in the City of Shanghai even think that they could save about €4,495 (46,797 CNY). With that, the Chinese basically believe that it is worth buying a hybrid vehicle, even at the time that they buy it. "The willingness of the Chinese to accept the price is astonishing, especially when considering that they earn less than Europeans or Americans," emphasized Dr. Neumann.

The lower fuel consumption of hybrid vehicles is the decisive criterion for Chinese drivers and the most interesting aspect of a hybrid drive. Two thirds of the Chinese asked would choose a hybrid with lower consumption and the same or better acceleration as a conventional motor. Comparing the regions, many drivers would choose this type of drive (in Beijing 71.7%, Shanghai: 65.4%, Guangzhou: 61.2%) "That is exactly the benefit of a hybrid drive," explained Dr. Neumann. More than half of the Chinese presume that the purchase of a hybrid vehicle pays off after about three years. Only 2.7% of drivers in China say that the purchase of a hybrid vehicle does not have to pay off, but that it is primarily a matter of protecting the environment and preventing climate change.

The fast pace of development in lithium-ion battery technology – including contributions by Continental – is leading to increased interest in electric cars. Almost three quarters of the Chinese car drivers could "definitely," "very likely" or "quite likely" see themselves buying a car exclusively designed for urban traffic that runs on battery power and produces no emissions at all. In comparison to the other nations asked, this is by far the most astonishing re­sult: 73.4% view this type of alternative drive very positively – presumably as something to counter the increasing air pollution in their cities.

With its ContiTech division, Continental has been active in China since 1978 and today supplies the automotive industry, machine and plant construction sector as well as the mining and printing industries with locally produced components and systems. Continental started its automotive business in China in 1994 in cooperation with Shanghai Automotive Brake Systems (SABS, a joint venture with SAIC in Shanghai). Following the acquisition of Siemens VDO Automotive AG (at the end of 2007), there are now about 7,500 staff working at 11 locations for the Continental Corporation.