Range-anxiety is a thing of the past for electric vehicle owners in the Chinese province of Guangdong.
The coastal region, which borders Hong Kong, has built hundreds of thousands of public charging points — the EV equivalent of petrol pumps — over the past few years.
With 345,126 public chargers and 19,116 charging stations as of the end of September, Guangdong has the largest EV charging network in China, one that has more than doubled from a year ago, according to the China Electric Vehicle Charging Infrastructure Promotion Alliance.
That’s about three times as many public chargers in the whole of the US, according to BloombergNEF data.
In a push to electrify their nations’ car fleets, governments around the world are trying to roll out and scale their public charging infrastructure swiftly enough to service new battery-powered cars.
President Joe Biden’s infrastructure law devotes $5 billion to building a nationwide network of EV charging ports along major travel corridors in the US, while Germany has spent or pledged $6.4bn to support the charging industry.
But both the US and Europe have fallen well behind China in building out their networks. A BloombergNEF analysis counted 112,900 public chargers deployed across the US and 442,000 in Europe by the end of 2021, compared with 1.15 million in China.
That gap is only growing. In just the past 12 months, China added 592,000 public chargers — more than the total number the Biden administration wants by 2030.
The government plans to build enough charging stations for 20 million EVs by 2025, according to a January document by the National Development and Reform Commission and nine other ministries.
These charging pylons are installed by third-party utility operators, state-owned electric companies — the two biggest of which are State Grid Corporation of China and China Southern Power Grid — as well as EV automakers like Tesla and China’s Nio and Xpeng.
Tesla operates more than 8,700 Supercharger stalls across 370 cities in China — roughly a quarter of its global Supercharger network.
China’s efforts to forge a green infrastructure are paying off: domestic demand for cleaner cars now dramatically dwarfs that of Europe and the US. A quarter of all new cars purchased in China are new-energy vehicles, and NEV sales are forecast to hit a record 6 million this year.
In Guangdong, ubiquitous charging is also boosting electric car ownership. EV sales jumped 151 per cent in the first half of the year, according to the Guangdong Bureau of Statistics.
The province now has more than 1.4 million electric vehicles, the highest share in the country, according to the National Monitoring and Management platform for new-energy vehicles.
“With more chargers, there’s less range anxiety. EV sales therefore go up,” said David Zhang, an automotive analyst who is also dean of the Jiangxi New Energy Technology Institute.
“Having so many chargers is definitely a breakthrough, but we’ve got to remember that charging still takes a lot longer than refilling the gas tank. That’s now the real obstacle.”
Guangdong’s provincial government is also doubling down on EV manufacturing. One in eight EVs sold in China is now made in Guangdong. From January to July, local EV production jumped more than two-fold from a year before.
Strong production capabilities can have a spillover effect, improving customer experience and after-sales service and even lowering pricing within the province, said Zhang.
Yoyo Gu, a 40-year-old housewife from Guangdong, traded in her Dongfeng Citroen C4 internal-combustion sedan for a GAC Aion V Plus electric SUV earlier this year as part of a provincial subsidy program to bolster EV adoption.
“I got around 8,000 yuan off the bill,” said Mr Gu. That’s on top of the EV purchase-tax exemption, which the government has extended until the end of 2023.
For the first few months, she recharged her SUV overnight at public charging stations in her neighborhood, before finally installing a private charging outlet in the parking lot of her residential complex.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Our Time Has Come
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