Date
23 March 2017
BYD chairman Wang Chuanfu said the company will use its core technology in electric vehicles, batteries and materials to build the monorail systems. Photo: Bloomberg
BYD chairman Wang Chuanfu said the company will use its core technology in electric vehicles, batteries and materials to build the monorail systems. Photo: Bloomberg

BYD to branch out into monorail in smaller Chinese cities

Electric-car maker BYD Co. is in talks with local officials in several of China’s smaller cities to build monorail systems amid concerns that the rapid growth in automobile ownership will worsen traffic congestion in urban areas, Bloomberg reports.

Monorail systems are a potential 3 trillion yuan (US$450 billion) market in China, based on an average 70-kilometer (44 miles) network in each of an estimated 300 cities, and will become a new major growth area for the company, the report quoted chairman Wang Chuanfu as saying.

The elevated single-rail tracks can be built on road dividers and are especially suited for smaller, less-developed cities because they cost one-sixth the price of a subway system and are cheaper to maintain, Wang said.

With the number of vehicles growing at an average annual rate of 15 percent in such cities and road space at only 1 percent, these urban areas are on course for the same gridlock gripping major Chinese cities like Beijing if they don’t adopt light transit, he said.

“Many third- and fourth-tier cities have approached us to discuss monorail,” Wang told Bloomberg in an interview.

“For many of these cities facing traffic congestion and financial constraints, if you can’t go underground, you have to go above.”

After leading BYD to top electric vehicle sales in China, Wang is steering the company into monorail as an area where he sees high barriers to entry and fewer competitors.

“BYD is taking advantage of its relationships with municipalities and the know-how in urban public transport that it’s built through the years marketing electric buses,” said Steve Man, an auto analyst with Bloomberg Intelligence.

“The foray into electric monorail expands the company’s electric propulsion and battery businesses.”

BYD’s competitors in monorail-making will include Bombardier Inc. and Hitachi Ltd., Wang said.

BYD will utilize its core technology in electric vehicles, batteries and materials to build the monorail systems, which will be paid for by local governments, he said.

The company will begin operating a 4.4-kilometer line at its base in Shenzhen in September, he said. An eight-carriage train will be able to carry about 1,600 standing passengers.

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