Chinese battery and car maker BYD Co. plans to start test-marketing an all-electric battery car in the U.S. next year, after almost a year’s delay, and is in talks with officials in Los Angeles to supply e-buses that could eventually lead to a manufacturing plant in the city, a senior company executive said.
Originally, the e6 vehicle was supposed to launch in the U.S. this year. The delay has been a setback for the global ambitions of China’s auto sector, which wants to use electric-vehicle technology to close the distance with more-established global car makers.
Stella Li, BYD’s senior vice president and head of its U.S. operations, said the holdup was caused by BYD’s efforts to make the car roomier, especially its rear-seat area that was cramped thanks to a beefy battery pack that needs to be stored under the seat.
In a recent telephone interview, she denied that the delay had anything to do with a possible intellectual-property infringement on certain battery technology by BYD.
Still, an individual close to BYD said the postponement was in part a result of fear of potential intellectual-property infringement involving lithium powder. The powder is a critical raw material in high-power lithium-ion batteries that help propel all-electric and plug-in electric hybrid cars, such as the Chevy Volt and the Nissan Leaf, as well as BYD’s e6 car.
The individual said, however, that BYD appears to have resolved the problem by securing a legal way to produce or procure lithium powder.
Ms. Li said “BYD’s formula [for lithium powder] is different,” and the company isn’t worried at all about any patent infringement with its technology. “We have our own IP,” she said.
She said BYD plans to ship as many as 50 e6 electric cars by the end of next year to fleet customers in Southern California, including the municipal government of Los Angeles. BYD earlier this year began selling e6 cars to taxi operators in the southern Chinese city of Shenzhen and is collecting field data to improve the car.
Ms. Li said BYD will make the e6 available for purchases by private buyers in the U.S. in 2012. She declined to forecast demand, saying it “will depend on gasoline prices and other peripheral factors.”
BYD Chairman Wang Chuanfu has said his Shenzhen-based company plans to sell the e6 model for slightly more than $40,000—competitive with some bigger rivals.
Meanwhile, Ms. Li said BYD is preparing to start supplying all-electric buses to the city of Los Angeles. Talks with the city have been going on since the beginning of this year, when BYD agreed to locate its U.S. headquarters in Los Angeles. Those negotiations involve a possible contract to make BYD a supplier of city buses.
“Initially, we would ship e-buses from China, but eventually we would have to localize production,” Ms. Li said, citing a greater cost advantage in assembling those buses in Los Angeles if there is enough demand.
Getting the company to locate its U.S. head office in Los Angeles took significant effort by the city, which agreed to consider conducting a pilot test for the bus, and to buy BYD’s all-electric vehicles.
Ms. Li said BYD plans to ship at least one electric bus by the second quarter of next year as “a demonstration vehicle” so that “the city could experience our bus first-hand.” If the test produced positive results, then the Los Angeles municipal government and BYD would sign an agreement to make the Chinese company a formal supplier of city buses.
Austin Beutner, a former Wall Street executive who this year was named the city’s first deputy mayor, said Los Angeles is interested in using electric vehicles in the city’s bus fleet.
“We are spending our policy dollars right now more on electric cars, but maybe we want to tilt it a little bit more toward public transportation,” Mr. Beutner said during a recent interview, citing the efficiency of the electric bus in transporting passengers compared with the individual electric passenger car.
To entice BYD to locate an electric-bus factory in Los Angeles, Mr. Beutner said that the city is willing to “put our municipal power to work” and place an order large enough for BYD to do so.
“Los Angeles would be able to buy several thousand electric buses… over a decade or so,” he said.
