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| Among the weeds and rubbish, hundreds upon hundreds of electric vehicles lie unused. Photographer: Qilai Shen/Bloomberg |
In the wake of a subsidy-driven frenzy, China established itself as a powerhouse in the electric car industry. However, this rapid growth has led to a peculiar consequence: sprawling fields across cities filled with abandoned electric vehicles (EVs) that now stand as monuments to the excesses of unchecked capital.
Perched on the fringes of Hangzhou, a dilapidated temple presides over what can only be described as an automotive graveyard – a landscape marred by fields teeming with forsaken EVs, swallowed up by weeds and litter.
This sight is by no means unique. Throughout China, similar graveyards have cropped up in numerous cities, though a few have been cleared. In Hangzhou, some vehicles have remained untouched for so long that vegetation has taken root in their trunks. Others have been abandoned in such haste that plush toys still occupy their dashboards.
These scenes bear a resemblance to the aftermath of China's bike-sharing debacle in 2018, when millions of bicycles found themselves submerged in rivers, ditches, and deserted parking lots following the meteoric rise and fall of tech-backed startups like Ofo and Mobike.
This time, the deserted EVs likely stem from the downfall of ride-hailing companies that owned them, or their impending obsolescence as automakers rolled out more advanced EV models with enhanced features and longer driving ranges. These abandoned vehicles stand as stark symbols of the potential wastage and excess that can ensue when capital surges into a burgeoning industry. They also offer an unexpected testimony to the monumental strides achieved in the electric transportation sector over recent years.
Around a decade ago, spurred on by government subsidies, a plethora of automakers in China, both established giants and startups, delved into electric car manufacturing. This surge produced a substantial number of early-stage EVs, modestly equipped cars whose batteries could only deliver a range of around 100 kilometers (approximately 62 miles) on a single charge.
These vehicles found their primary clientele in ride-hailing companies that leased them to drivers. "At the onset of China's EV market, the bulk of deliveries were aimed at car-sharing fleets," Young Huang, a senior analyst at JSC Automotive, a consulting firm based in Shanghai and Stuttgart, explained. "Private customers were few and far between."
This demand fueled an industry that has since expanded exponentially. Presently, China reigns as the global leader in electric vehicles, generating nearly 6 million EVs and plug-in hybrids in the past year alone – constituting almost one-third of all new cars sold domestically. The country boasts a 60% share of the global electric vehicle fleet and boasts the most comprehensive EV charging network worldwide, meticulously erected with the backing of governmental support.
Nevertheless, this rapid evolution has not come without its share of casualties. Many of the pioneering ride-hailing companies that embraced EVs have succumbed to bankruptcy. In 2019, approximately 500 Chinese electric car manufacturers existed; however, this number has dwindled to roughly 100 today.
Regrettably, these EV graveyards signify a disconcerting side effect of this consolidation process. Beyond being eyesores, the haste to dispose of these EVs undermines their environmental advantage, as their production is more resource-intensive than traditional combustion engine vehicles, and they only surpass the latter in terms of carbon emissions after several years. Moreover, each discarded EV carries valuable components such as nickel, lithium, and cobalt in its spent batteries – materials that could otherwise be recycled to enhance the environmental sustainability of China's EV sector.
Local media sources report that the Hangzhou government has committed to addressing this issue, which first surfaced in 2019. However, a recent visit by Bloomberg News revealed several sites still inundated with abandoned EVs in the Yuhang and West Lake districts of the city, even after scrutinizing satellite images and hacking through overgrown dirt paths.
Prior to Tesla's establishment of a production facility in Shanghai in early 2020, most EVs produced within China were of modest quality and size. These offerings faced an uphill battle against the more aesthetically pleasing, combustion engine vehicles on the market.
To catalyze the adoption of EVs, the Chinese government, during the late 2000s, introduced rebates of up to 60,000 yuan (approximately $8,400) per vehicle and imposed restrictions on gasoline vehicle ownership in several major cities. Automakers either endorsed or established ride-hailing startups that filled their fleets with electric options.
Geely, for example, supported Caocao Chuxing, which still operates today. However, another car-sharing service, Panda, backed by Chongqing Lifan Auto Co., collapsed, and Lifan Auto itself declared bankruptcy in 2020. It was subsequently acquired by Geely a year later. The Maple EV brand, a product of a joint venture between Geely and Lifan, was spotted within one of the sites surveyed by Bloomberg News.
In the mid-2010s, China escalated its push for EV adoption through a credit system that rewarded manufacturers for producing EVs and penalized the production of fuel-inefficient vehicles. A 2021 report by Fitch Ratings Inc. suggested that some companies established ride-hailing ventures as a convenient outlet for the accumulation of unsold EVs that failed to capture the public's interest.
Certain firms even manipulated subsidy programs by falsifying records for non-existent EVs. For instance, they would construct vehicles without batteries or create cars with batteries that failed to meet specified standards. In 2016, China's official People's Daily estimated that numerous companies fraudulently claimed over 9.3 billion yuan (around $1.3 billion) in subsidies.
In 2019, Beijing substantially reduced national subsidies for EV purchases, leaving many ride-hailing companies ill-equipped to cope with the policy shift, which had a detrimental impact on their cash flow. "These players couldn't survive," Huang observed.
The public's attention was first drawn to these EV graveyards later in that same year, when internet users and local media outlets reported on the phenomenon.
Jing Yang, the director of China corporate research at Fitch Ratings and one of the contributors to the agency's 2021 report, voiced her lack of surprise regarding the existence of these EV graveyards. According to Yang, the involvement of taxi companies and fleet operators significantly contributed to consumer awareness of EVs as a safe alternative. This engagement motivated manufacturers to invest in EV-related technologies when consumer demand was still nascent, laying the groundwork for broader adoption in the future.
"This phenomenon marks the history of China's new-energy vehicle market but only offers limited insight into its future," Yang commented.
Geely, which oversees Youxing, clarified that a mere 40 of the abandoned cars were owned by Caocao, and it had arranged to store the vehicles on the plot until August 19. These roadworthy vehicles will subsequently be relocated to other cities.
Didi, Changan, and Dongfeng Forthing, whose Jingyi S50 model was also spotted among the abandoned EVs, refrained from responding to inquiries. China's Ministry of Industry and Information Technology, the regulatory body for EVs, did not provide a response to faxed inquiries, while attempts to contact the Hangzhou government went unanswered.
A 2021 local media report indicated that Faststep's vehicles were awaiting auction. The company's official WeChat account has remained dormant since 2019, and the phone numbers listed on an outdated post are no longer operational.
Wu Guoyong, a photographer based in Shenzhen, was among the first in China to document the wastage resulting from rapid development. He captured striking drone images of mountains of abandoned bicycles in 2018. The following year, he filmed aerial footage showcasing thousands of discarded electric cars scattered across empty lots in Hangzhou and Nanjing, the capital of China's Jiangsu province.
According to Wu, China's financial markets were modest when the nation began opening up to the world. However, unregulated financing has since surged like a "tsunami." Wu offered a poignant reflection: "The abandoned bicycles and EV graveyards are the outcomes of unconstrained capitalism. The depletion of resources, environmental degradation, the evaporation of wealth – these are natural consequences."
