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<ul><li>This year’s initial <keyword id="19894908" type="General" weightage="20" keywordseo="festive-season" source="keywords">festive season</keyword> has been good for smartphone makers, with an 11% increase in sales.</li><li><keyword id="19897758" type="General" weightage="20" keywordseo="Samsung" source="keywords" meta.keywordsubtype="org" meta.entityname="Samsung" meta.hostid="261" meta.entityid="Samsung">Samsung</keyword> has emerged as the biggest smartphone maker in the first phase, followed by <keyword id="19894961" type="General" weightage="20" keywordseo="Apple" source="keywords" meta.keywordsubtype="org" meta.entityname="Apple" meta.hostid="261" meta.entityid="Apple">Apple</keyword>.</li><li>Samsung recorded a 20% market share in the first phase, followed by Apple with a 16% market share.</li></ul>The festive season is here and e-commerce platforms Amazon, Flipkart and others have started their festive sales, offering devices such as smartphones at a discounted price. According to a report by Tech Insights, <keyword id="21017681" type="General" weightage="20" keywordseo="smartphone-sales" source="keywords">smartphone sales</keyword> recorded an 11% growth in the first wave of the festive season sales in India between September 26 to October 6. Among the smartphone makers, Samsung topped the chart with a 20% market share in volume terms during the first phase. "Samsung led the smartphone sales volume with a 20% market share followed by Apple in the first wave of the festive season," Tech Insight said in a blog. Apple is also gaining speed in the Indian market, with over 10 lakh iPhones being sold during the 11-day sale period. The top-selling models for Samsung include the Samsung Galaxy M35, Galaxy S23, Galaxy A14, Galaxy S23 FE and more. "Samsung was also the main sponsor for sales events on Flipkart and Amazon which also gave it an additional push. Samsung sales in unit terms grew 17% year-on-year in 2024's first wave compared to 2023's first wave," the blog said. The platform estimates that online sales volume accounted for 78% of the total sales during the phase 1 period. It was driven by online sales festivals like Big Billion Days on Flipkart and The Great Indian Festival on Amazon India while offline sales started to pick momentum with the start of Navratri. Apple was a surprising second with a 16% market share driven by strong sales of the iPhone 15 which crossed a million mark in 11 days of sales. iPhone 13 followed but the sales gap between iPhone 15 and 13 was significant. Oppo, OnePlus, Xiaomi, and Realme were also among the top vendors in the first wave of the festive season by volume. "North region sales were less compared to other region sales due to the importance of Shradh in this region. Also, states like West Bengal and Gujrat experienced better sales compared to other regions given the preparation for the popular Durga Pooja festival in these states," the blog said. With inputs from agencies. SEE ALSO: <a href="https://www.businessinsider.in/business/auto/news/byd-emax-7-electric-mpv-launched-in-india-starting-at-26-9-lakh/slidelist/114046121.cms">BYD eMax 7 electric MPV launched in India starting at ₹26.9 lakh</a> <a href="https://www.businessinsider.in/personal-finance/news/heres-how-a-reddit-user-was-able-to-get-an-iphone-16-at-under-27000/articleshow/114035179.cms">Here’s how a Reddit user was able to get an iPhone 16 at under ₹27,000</a> <a href="https://www.businessinsider.in/stock-market/news/hyundai-swiggy-ather-upcoming-large-ipos-in-india/slidelist/114014140.cms">Hyundai To Swiggy: Everyone wants to cash in on the IPO bonanza</a>

Samsung leads the first phase of festive sales with a 20% market share

<ul class="summary-list"><li>Europe's luxury carmakers once dominated in China, but are now under intense pressure.</li><li>BMW, Mercedes-Benz, and Porsche have all reported slumping sales in the world's largest auto market.</li></ul>The days of European carmakers dominating China's luxury vehicle market are over.Germany's <a target="_blank" href="https://www.businessinsider.com/germany-auto-giants-volkswagen-bmw-mercedes-struggle-sales-china-evs-2024-10">BMW</a> and <a target="_blank" href="https://www.businessinsider.com/mercedes-benz-sliding-ev-sales-and-weak-demand-in-china-2024-10">Mercedes-Benz </a>have suffered a sales slump in the world's largest auto market in recent months amid rising pressure from a wave of Chinese EV upstarts.BMW reported a one-third decline in Chinese sales in the most recent quarter, while deliveries of new Mercedes cars dropped 10% in the first nine months of the year. Its high-end S-Class range was particularly affected as some consumers cut spending amid a <a target="_blank" class="" href="https://www.businessinsider.com/china-economy-3q-gdp-growth-stock-market-stimulus-2024-10">faltering economy</a>.Aston Martin, a luxury British brand famous for its association with James Bond, said sales in China had fallen by more than half this year in its third-quarter earnings.Meanwhile, Porsche, owned by Volkswagen, said it would shrink its Chinese dealer network amid plunging profits and a 29% slide in sales in China in the nine months to September 30.The German company has seen stalling demand for its luxury vehicles, with sales of the $100,000 electric Taycan down 47% globally in the same period.<div type="image" title="The 2023 Porsche Taycan." height="3538" width="5750" msid="114850638" hostid="261" sizebytes="544158"></div><a target="_blank" class="" href="https://www.businessinsider.com/rolls-royce-spectre-ev-interior-tour-photos-review-2023-7">Rolls-Royce</a>, the British marque owned by BMW, has also faced weaker sales in China this year. Its luxury car marker was experiencing "more challenging times," CEO Chris Brownridge told Bloomberg in September.The Chinese market has become increasingly difficult for European brands.Volkswagen was dethroned by <a target="_blank" class="" href="https://www.businessinsider.com/byd-seal-electric-car-review-test-drive-elon-musk-tesla-2024-3">BYD</a> as China's biggest carmaker last year, and the share of China's car market held by German automakers has dropped from about a quarter before the pandemic to less than 15%, according to Bloomberg data."China is an incredible challenge, not just for Porsche," said finance chief Lutz Meschke in comments reported by Reuters. "In the future, we can no longer assume that China will return to where it was for European players."<h2 id="16591c84-687a-45c6-9996-fcfa8cb9e4a0">High-tech competition</h2>Upmarket European automakers are being squeezed by their Chinese rivals.Many are offering vehicles <a target="_blank" class="" href="https://www.businessinsider.com/chinese-ev-makers-battle-for-market-dominance-with-smart-features-2024-5">packed full of novel features and intelligent software</a> of them have growing designs on China's high-end auto market, and areLast year Tesla rival BYD launched the Yangwang U8 SUV last year. The $150,000 hybrid has a motor on each wheel that allows it to move <a target="_blank" class="" href="https://www.businessinsider.com/byd-chinese-tesla-rival-yangwang-u9-supercar-jump-dance-2023-4">like a crab</a>.The U8 also comes with an onboard drone, and BYD says it can even <a target="_blank" class="" href="https://www.businessinsider.com/china-ev-giants-innovation-ai-auto-show-european-rivals-despair-2024-10">float on water for up to 30 minutes</a>.Other Chinese automakers have gone to even greater lengths to stand out in the country's red-hot auto market, with Zeekr showing off the spacious and luxurious interior of its MIX minivan by having an executive eat a hot pot inside it.<div type="image" title="Zeekr Mix" height="3024" width="4032" msid="114850635" hostid="261" sizebytes="755406"></div>The competitiveness of the Chinese market means consumers don't need to spend a fortune to obtain luxury vehicles.The SU7, an electric sedan built by Chinese smartphone maker Xiaomi, is <a target="_blank" class="" href="https://www.businessinsider.com/xiaomi-su7-chinese-ev-features-specs-photos-ford-ceo-2024-10">packed with high-tech features</a> including a 16.1-inch infotainment screen and remote voice control that allows drivers to control household appliances from the car.But it is also relatively affordable, with the base version starting at 215,900 yuan ($30,300) and the high-end SU7 Max priced at 299,900 yuan ($42,100). Xiaomi has just <a target="_blank" class="" href="https://www.businessinsider.com/chinese-ev-xiaomi-su7-driven-by-fords-ceo-faster-model-2024-10">unveiled a high-performance version of the SU7</a> that costs 814,900 yuan ($114,000).Steve Dyer, managing director at AlixPartners, a London-based consulting firm, told Business Insider that Chinese manufacturers were encroaching on the premium market from the "bottom up," targeting the lower segment before gradually releasing more expensive vehicles aimed at less price-sensitive customers."The Chinese companies are doing what the Korean companies did to get market share outside Korea, and that is to offer a lot of feature content for a good price," he said.Dyer said Chinese buyers often focused on luxurious interiors, as well as intelligent technology such as advanced driver assist systems — an area in which <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-tesla-full-self-driving-technology-china-local-competition-2024-4">Chinese automakers excel</a> and their European rivals have struggled to keep up."They've fallen behind in the sense that they're applying an automotive product development mindset to a fast-moving, rapidly changing, technology space," said Dyer.A study by AlixPartners found that Chinese automakers released 40 over-the-air software updates between March 2023 and February this year, compared with just two from legacy automakers."It's a typical software mindset. You're willing to launch a product quickly, even though it may need fixing later because you know you can fix it," said Dyer.<h2 id="a63ec01b-1782-4334-a38c-155f7b0a6f6e">Hard to quit</h2>Despite a challenging environment, Western premium automakers can ill afford to give up on China. It remains Volkswagen's second- biggest global market, behind Western Europe, and Mercedes sold around a third of its cars there last year.<div type="image" title="Xiaomi SU7" height="1663" width="2500" msid="114850641" hostid="261" sizebytes="189460"></div>They're likely to face a bumpy road as they try to recover, however.Because the premium vehicle market is less price-sensitive, Dyer said more Chinese automakers will move into it to diversify away from China's brutally competitive mass market.As well as increased competition, European automakers face a geopolitical headache.Tim Urquhart, principal automotive analyst at S&amp;P Global Mobility, told BI the <a target="_blank" class="" href="https://www.businessinsider.com/chinese-electric-vehicles-european-tariffs-retaliation-vw-bmw-mercedes-tesla-2024-10">European Union's tariffs on Chinese automakers</a> meant Beijing could impose levies on European car imports in retaliation."They could be facing a perfect storm if those tariffs are imposed as well," he said.Even if that does happen, Urquhart said the sheer size of the Chinese market means it's unlikely that major Western automakers will abandon it anytime soon. "They can't afford to make a full-scale retrenchment and retreat from their current position, especially as they've invested so much there."

Luxury European automakers are getting crushed in China

<ul class="summary-list"><li>Chinese EV firms like BYD have been effectively shut out of the US thanks to high tariffs.</li><li>Many of them sell their electric vehicles in Europe, despite the EU introducing its own tariffs.</li></ul>US tourists who visited Europe this summer may have spotted some unfamiliar EVs on the road — some of which will have been built in China.<a target="_blank" class="" href="https://www.businessinsider.com/byd-saic-chinese-ev-makers-plot-world-takeover-2024-6#">China's electric vehicle</a> giants were <a target="_blank" class="" href="https://www.businessinsider.com/china-evs-tariffs-joe-biden-transport-2024-5">effectively shut out of the US in May</a>, when the government imposed crippling tariffs on China-based EV companies amid growing geopolitical tensions.The tariffs, designed to prevent the US auto market from being flooded with cheap Chinese EVs, have made it virtually impossible for companies like BYD to export their EVs stateside.The European Union set out <a target="_blank" class="" href="https://www.businessinsider.com/chinese-ev-companies-hit-with-new-tariffs-in-the-eu-2024-6">its own trade restrictions on China's Tesla rivals in June</a> — but unlike in the US, many have a sizable presence in the European market.Here are some of the Chinese electric vehicles that European drivers can buy right now but US drivers can't:<h2 id="8c27c4d8-53fb-4dcf-a9e7-30de84bd3e37">BYD</h2><div type="image" title="BYD Seal" height="683" width="1024" msid="113258283" hostid="261" sizebytes="34490"></div><a target="_blank" class="" href="https://www.businessinsider.com/tesla-rival-byd-chinese-evs-expands-in-europe-new-factory-2024-7">BYD</a><a target="_blank" href="https://www.businessinsider.com/tesla-rival-byd-chinese-evs-expands-in-europe-new-factory-2024-7"> is expanding rapidly in Europe</a>, and plans are underway to build two factories in Hungary and Turkey in the coming years.The Warren Buffett-backed automaker sells <a target="_blank" class="" href="https://www.byd.com/eu">six EV models in Europe </a>— from the Dolphin Hatchback, which <a target="_blank" class="" href="https://www.byd-cars.de/marken/byd/dolphin#8dfa9335-fae6-48ae-ade9-929a8d4761ba">costs from €32,990</a> ($36,400), to the Han sedan, which <a target="_blank" class="" href="https://www.byd-cars.de/marken/byd/han#a658351d-cfa0-49fd-b324-ff9e61445dd1">starts at €69,000</a> ($76,100) in Germany.Despite the EU imposing <a target="_blank" href="https://ec.europa.eu/commission/presscorner/detail/en/ip_24_4301">a 17% import tariff on BYD in August</a>, the company isn't slowing down. As it competes with Tesla worldwide, it plans to <a target="_blank" href="https://www.businessinsider.com/byd-cheap-ev-seagull-coming-to-europe-china-us-tariffs-2024-5">bring its $10,000 Seagull EV to Europe in 2025</a>.<h2 id="28cbf932-e633-467a-ba74-145fd9eebf92">Nio</h2><div type="image" title="Nio ET7" height="742" width="1024" msid="113258297" hostid="261" sizebytes="65766"></div>Chinese EV brand Nio is known in its home country <a target="_blank" class="" href="https://www.businessinsider.com/ev-battery-swapping-china-rescue-us-revolution-2024-2">for its battery swapping stations</a>, designed to prevent long charging times by removing flat batteries and replacing them with fully charged ones.Like BYD, Nio has been expanding in Europe, establishing battery swap stations across the continent and <a target="_blank" class="" href="https://www.nio.com/news/nio-house-amsterdam?&amp;noredirect=">selling six models as of May 2024</a>.That includes the stylish ET7, which Nio says comes with an <a target="_blank" class="" href="https://www.nio.com/et7?&amp;noredirect=">AI-powered suspension and an estimated 1,000km (620 mile) range</a>.<h2 id="93224fa1-31bc-45f4-8dc3-cadaccde6d4f">Xpeng</h2><div type="image" title="Xpeng G6" height="684" width="1024" msid="113258292" hostid="261" sizebytes="71784"></div>Xpeng is known for its quirky EV models, including a <a target="_blank" class="" href="https://www.businessinsider.com/xpeng-tesla-rival-flying-car-prototype-drone-evtol-2022-11">flying car</a>.In Europe, the automaker sells its G9, G6, and P7 models in various markets, including Denmark, Sweden, and Norway.<h2 id="985d743a-d9a6-45bc-82ed-a4c4ae7f187f">Zeekr</h2><div type="image" title="Zeekr 001" height="683" width="1024" msid="113258285" hostid="261" sizebytes="39634"></div>Chinese manufacturer Zeekr is one of many companies <a target="_blank" class="" href="https://www.businessinsider.com/chinese-electric-vehicles-byd-selling-record-cars-tesla-competition-deliveries-2024-7">vying to take on Tesla in China.</a> It has two models available in parts of Europe.Both the Zeekr X and the Zeekr 001 are luxury EVs priced between <a target="_blank" class="" href="https://shop.zeekr.eu/en-nl/configuration/?linkCode=1">42,490 euros and 59,490 euros ($46,800 to $65,600)</a> in the Netherlands. The Zeekr 001 boasts an estimated <a target="_blank" class="" href="https://www.zeekr.eu/models/001">620km (385 miles) of range and 0 to 60 mile acceleration in 3.8 seconds</a>.Like many other Chinese automakers, Zeekr faces EU's tariffs. CEO Andy An <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-07-19/geely-s-zeekr-considers-building-evs-in-europe-to-avoid-tariffs">told Bloomberg that</a> the company may move production to Europe in the coming years as a result.<h2 id="3d2d47ce-d5f2-48a3-b76e-1431dec40a8b">MG</h2><div type="image" title="The MG Cyberster" height="681" width="1024" msid="113258295" hostid="261" sizebytes="64984"></div>Historic British car brand MG is owned <a target="_blank" class="" href="https://www.reuters.com/article/business/saic-to-sell-mg-cars-in-eu-by-year-end-idUSTRE60O088/">by one of China's largest automakers, SAIC Motor</a>.Since it came under SAIC Motor's control, MG has <a target="_blank" class="" href="https://www.bbc.co.uk/news/uk-england-birmingham-37449289">moved some of its vehicle production to China</a> and produced a series of electric models, including the MG4.This electric hatchback starts at <a target="_blank" class="" href="https://www.mg.co.uk/new-cars/mg4-ev">£26,995 ($35,300)</a> in the UK, making it <a target="_blank" class="" href="https://www.tesla.com/en_gb/model3/design#overview">£12,995 ($17,000) cheaper</a> than Tesla's least expensive offering in the country.MG also recently launched the Cyberster, a stylish electric roadster that is available <a target="_blank" class="" href="https://www.mgcyberster.co.uk/configurator">for preorder in the UK for £54,995 ($72,000)</a>.As of yet, there's no sign of the MG4 or the Cyberster coming to the US — although MG is planning to <a target="_blank" class="" href="https://www.reuters.com/business/autos-transportation/mg-motor-build-manufacturing-plant-rd-center-mexico-2024-08-08/">build a manufacturing plant in Mexico</a>, a move some US lawmakers have warned could provide Chinese manufacturers <a target="_blank" class="" href="https://www.businessinsider.com/chinese-ev-companies-byd-mg-plan-factories-mexico-washington-concern-2023-12">with a "backdoor" to the US market</a>.

Chinese EVs you can buy in Europe — but not in the US

<ul class="summary-list"><li>Local and Western carmakers have flocked to the Beijing Auto Show.</li><li>Highlights include Zeekr's transforming minivan and a flying car built by Xpeng. </li></ul>If you need more evidence that <a target="_blank" href="https://www.businessinsider.com/china-xi-jinping-crush-tesla-elon-musk-american-ev-industry-2024-2">China's EV market is booming</a>, just look at the country's biggest car show.<a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-23/vw-bmw-out-to-prove-they-re-not-a-spent-force-at-china-car-show">Around 117 new cars</a> debuted at the Beijing auto show, which began April 25 and runs until May 4, as dozens of local manufacturers jostled for space with foreign imports like Volkswagen and Mercedes in <a target="_blank" href="https://www.businessinsider.com/china-tesla-electric-vehicle-market-dominance-competition-byd-aion-wuling-2024-4">China's brutally competitive automobile sector</a>.The likes of <a target="_blank" href="https://www.businessinsider.com/china-byd-electric-car-ev-why-not-coming-to-us-2024-3">BYD</a>, Zeekr, and Xiaomi all showed off new models — here are some of the most interesting vehicles on offer.<h2>The Zeekr Mix</h2><div type="image" title="Zeekr Mix" height="1666" width="2500" msid="109839618" hostid="261" sizebytes="214718"></div>Zeekr might be only three years old, but the company has made a name for itself with its<a target="_blank" href="https://www.businessinsider.com/ev-electric-vehicle-china-brands-byd-nio-wuling-zeekr-geely-2023-5#4-geelys-zeekr-is-just-2-years-old-but-it-already-has-international-ambitions-5"> quirky EVs</a>.At the auto show, the EV firm unveiled the Zeekr Mix, an electric multi-purpose vehicle with swiveling chairs that allow it to <a target="_blank" href="https://www.forbes.com/sites/jamesmorris/2024/04/28/auto-china-2024-zeekr-mix-is-much-more-than-just-a-novel-mpv/?sh=129c8e2a2ac8">transform into a small room</a> when parked.The company, owned by Chinese auto giant Geely, <a target="_blank" href="https://electrek.co/2024/02/27/zeekr-launches-001-refresh-improved-specs-lower-prices/">recently released</a> its all-new Zeekr 001 model, equipped with battery technology that can go from <a target="_blank" href="https://insideevs.com/news/715042/2024-zeekr-001-charging-speed/">10% to 80% charged in just 11 minutes</a>.<h2>BYD targets high-end customers</h2><div type="image" title="BYD Yangwang U8" height="1663" width="2500" msid="109839622" hostid="261" sizebytes="447414"></div>By far the biggest name in China's EV market is BYD, the Warren Buffett-backed firm that is probably giving Elon Musk sleepless nights.The EV upstart has become known for its cheap vehicles, such as the <a target="_blank" href="https://www.businessinsider.com/byd-seagull-cheap-ev-electric-car-tesla-china-2023-4">$11,000 Seagull</a>, but the company was showing off its more high-end models in Beijing.That includes the Yangwang U8, the latest version of which, the <a target="_blank" href="https://cnevpost.com/2024/04/25/byds-yangwang-launches-new-variant-u8-gives-u7-debut/">Off-road Master Edition</a>, was unveiled in Beijing.This 1.1 million yuan ($150,000) SUV is capable of <a target="_blank" href="https://www.autoevolution.com/news/meet-the-car-that-floats-byd-s-yangwang-u8-suv-comes-with-an-emergency-floating-mode-221628.html">floating for up to 30 minutes</a> and turning 360 degrees on the spot <a target="_blank" href="https://www.youtube.com/watch?v=dkROmU9Bxbw">like a tank</a> — and customers can even add a <a target="_blank" href="https://www.wired.com/story/evs-with-built-in-camera-drones-have-already-landed-in-china/">built-in drone</a> for an <a target="_blank" href="https://apnews.com/article/china-beijing-auto-show-ev-8ee415e956b818be6d363367c8180b4f">extra 100,000 yuan</a> ($14,000). BYD also announced a new cheap electric hatchback as it looks to squeeze Tesla even further. The <a target="_blank" href="https://electrek.co/2024/04/26/byd-unveils-sleek-new-electric-hatch-1000-hp-z9-gt-ev/">Ocean-M</a> hatchback will be released later this year and will cost between 150,000 yuan to 200,000 yuan ($20,00 to $27,000).<h2>Xiaomi brings its Tesla rival</h2><div type="image" title="Xiaomi SU7" height="1663" width="2500" msid="109839625" hostid="261" sizebytes="189460"></div>One of the biggest draws of the auto show was the SU7, an electric SUV built by <a target="_blank" href="https://www.businessinsider.com/china-xiaomi-launch-electric-car-apple-failed-tesla-2024-3">smartphone maker Xiaomi</a>.The EV promises to offer <a target="_blank" href="https://www.businessinsider.com/xiaomi-su7-ev-photos-specs-features-tesla-rival-2023-12">a range of 500 miles</a> and a battery that can be fully charged within 15 minutes, according to Xiaomi, and drivers will have access to the company's <a target="_blank" href="https://www.businessinsider.com/elon-musk-tesla-full-self-driving-technology-china-local-competition-2024-4">next-gen autonomous driving features</a> — all for a price point that starts at<a target="_blank" href="https://www.bloomberg.com/news/articles/2024-03-28/xiaomi-unveils-ambitious-pricing-for-entry-in-cutthroat-ev-race"> 215,900 yuan ($30,00)</a>.It's not surprising that the EV <a target="_blank" href="https://www.reddit.com/r/electricvehicles/comments/1cf9vuo/people_queue_hours_to_see_xiaomi_su7_closer_at/">appeared to attract huge queues</a> when it went on display at the Beijing conference. Xiaomi has said that the company has already <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-25/xiaomi-says-su7-ev-orders-reach-75-723-since-march-launch">received more than 75,000 orders</a> for the SUV, with deliveries beginning in March.<h2>European automakers join the party</h2><div type="image" title="VW ID-Code" height="1663" width="2500" msid="109839628" hostid="261" sizebytes="266854"></div>Not to be outdone by their Chinese counterparts, Western automakers also had a large presence at the Beijing auto show.Volkswagen, once China's largest car brand before being <a target="_blank" href="https://fortune.com/europe/2024/01/23/volkswagen-top-car-seller-china-byd-warren-buffett-berkshire-hathaway/">overtaken by local rivals</a>, showed off its <a target="_blank" href="https://www.volkswagen-newsroom.com/en/the-new-id-code-world-premiere-18343">ID.Code 01 concept EV</a>, which features a <a target="_blank" href="https://www.volkswagen-newsroom.com/en/the-new-id-code-world-premiere-18343/the-design-and-technologies-of-the-interior-in-detail-18348">built-in robot that vacuums the car</a> when it's not being used.German firm Mercedes, meanwhile, unveiled an electric version of its <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-24/electric-g-wagon-pricing-performance-for-new-mercedes-benz-suv">iconic G-Wagon off-roader</a>, which the company said would launch in China <a target="_blank" href="https://www.reuters.com/business/autos-transportation/mercedes-benz-shows-off-electric-line-up-beijing-autoshow-not-giving-up-2024-04-25/">later this year</a>.<h2>Xpeng shows off its flying car</h2><div type="image" title="Xpeng flying car" height="1667" width="2500" msid="109839631" hostid="261" sizebytes="292698"></div>The number of companies trying to make it in China's EV market — <a target="_blank" href="https://www.businessinsider.com/china-tesla-electric-vehicle-market-dominance-competition-byd-aion-wuling-2024-4">at least 123</a>, according to one auto consultant — has seen some firms branch out in unexpected directions.One is Chinese EV maker Xpeng with its AeroHT flying car prototype that went on <a target="_blank" href="https://electrek.co/2024/04/25/xpeng-2k-pure-visual-adas-neural-network-fast-charging-ai-ev-sub-brand-beijing/">display in Beijing</a>.The AeorHT has been in development for a decade, and the affiliate company behind it is reportedly <a target="_blank" href="https://www.scmp.com/business/china-business/article/3260577/xpengs-flying-car-affiliate-aeroht-closes-airworthiness-certification-chinese-ev-maker-targets">close to receiving regulatory approval to fly</a> — but no price or release date has been announced yet, so may be a while before the AeroHT dominates China's skies.

These are the wildest EVs unveiled at China's biggest auto show

<ul class="summary-list"><li>Tesla reported disappointing results for the first quarter.</li><li>But investors celebrated news of cheaper vehicles on the horizon.</li></ul><a target="_blank" href="https://www.businessinsider.com/tesla">Tesla</a> had some bad news and some good news when it released <a target="_blank" href="https://www.businessinsider.com/tesla-stock-tsla-quarterly-earnings-call-report-live-updates-2024-4">first-quarter earnings</a>.The bad: It reported revenue and earnings that were below Wall Street expectations, and posted negative free cash flow.The good news: <a target="_blank" href="https://www.businessinsider.com/cheaper-teslas-arriving-sooner-than-planned-2024-4">Cheaper Teslas</a> are on the way!Tesla's plan to accelerate the launch of new models — including more affordable cars — and talk of a <a target="_blank" href="https://www.businessinsider.com/tesla-reveals-uber-competitor-ride-hailing-app-photos-2024-4">robotaxi service</a> was enough to send the <a target="_blank" href="https://markets.businessinsider.com/stocks/tsla-stock">stock price</a> higher despite the earnings miss.The investor reaction suggests Wall Street has bought into the idea that cheaper vehicles will help solve some of <a target="_blank" href="https://www.businessinsider.com/tesla-rough-year-sales-slump-layoffs-china-ev-competition-2024-4">Tesla's demand challenges</a>.<a target="_blank" href="https://www.businessinsider.com/elon-musk-tesla-avoid-ev-sales-slowdown-china-byd-2024-1">EV sales growth</a> has slowed in part because most of the options are <a target="_blank" href="https://www.businessinsider.com/electric-car-ev-sales-prices-problem-transportation-2024-1">more expensive</a> than the average car purchase in the US, or so the theory goes."If you have a great product at a great price, the sales will be excellent," CEO Elon Musk said Tuesday on an earnings call.That might ordinarily be true. But Tesla is no ordinary product. Even at a lower price, say $25,000, it's a very significant purchase — likely one of the most expensive purchases a person will make.So let's for a second look at why a lower ticket price might not be a panacea for Tesla.<h2>Switching from gas to electric is a big deal</h2>Many EV buyers thus far have been <a target="_blank" href="https://www.businessinsider.com/ev-electric-car-sales-plateau-early-adopters-competition-2023-8">early adopters</a>, and there are many, many more car buyers who are yet to be convinced. It's part of the reason <a target="_blank" href="https://www.businessinsider.com/tesla-blames-hybrids-for-lower-sales-2024-4">hybrids</a> have been <a target="_blank" href="https://www.businessinsider.com/toyota-hybrid-cars-ev-sales-growth-prius-bz4x-2024-2">having a moment</a>, as an intermediate step from gas-powered cars to fully electric vehicles.It's possible that there are a bunch more buyers out there who would love to buy a Tesla but just can't afford one. How big is that group of buyers? It's not clear."These new vehicles still bring a lot of new, unanswered questions, and TSLA didn't really address, leaving us to believe much is still in flux," UBS said in a note following the earnings release."What are they really, and what buyer are they targeting other than 'lower cost'? Lower cost may not be enough because of lower used Tesla pricing," the note added.For context, a <a target="_blank" class="" href="https://affiliate.insider.com?h=192cc58680062c6e90d96822403840fc573b3e5de0b1bc3eb9ebaf1fa56a9b93&amp;postID=66290b7af33b2f19d556e5bd&amp;postSlug=will-cheaper-tesla-lure-buyers-ev-demand-2024-4&amp;site=bi&amp;u=https%3A%2F%2Fwww.carvana.com%2Fcars%2Ftesla">quick search</a> of Carvana reveals a whole bunch of used Teslas priced in the $25,000 to $30,000 range. Many of those listed have seen recent price drops.Are they a good deal? It's hard to say. The resale data for used EVs is sparse, and the longevity of batteries is scattershot as technology improves.<h2>Infrastructure challenges remain</h2>EVs also require entirely different infrastructure from gas-powered vehicles, and anxiety over battery range and charging stations continues to be a real issue for <a target="_blank" href="https://www.businessinsider.com/tesla-owners-share-unexpected-headaches-owning-ev-electric-car-2023-7">EV owners</a>.The number of charging stations in the US has grown gradually over the years, but operators have <a target="_blank" rel="noopener noreferrer" class="c-link" href="https://www.businessinsider.com/electric-car-charging-reliability-broken-stations-ev-2022-5">struggled with maintenance and uptime issues</a> — and some lack the amenities like snacks and bathrooms you'd find at gas stations. It's also worth noting that a full charge for a Tesla, which has nearly 7,000 US charging stations, could take up to 30 minutes.Maybe infrastructure isn't a core concern for the archetypal early Tesla buyer: someone who might be a tech employee in California with plugins in their garage or driveway — and also at their office. There are many other Tesla buyers, of course, but as Tesla introduces lower-cost models in search of different buyers, needs will shift.Today's buyers of a Honda Civic or Toyota Camry, two of the most prevalent cars on American roads, may not be willing to invest the time and money in perfecting their <a target="_blank" rel="noopener noreferrer" class="c-link" href="https://www.businessinsider.com/how-to-charge-your-electric-car-at-home-2023-5">home-charging setup</a>, which can require an electrician to install high-voltage plugs in a convenient spot. And that's, of course, only if they own their own parking space. Installation might be trickier for people living in apartment complexes, urban townhouses, or myriad other housing situations.<h2>Musk and Tesla are politicized</h2>As Tesla looks to lure potential new buyers with a cheaper car, it will have to contend with souring consumer sentiment toward the EV maker.The number of US consumers who say they would consider buying a Tesla fell to 31% in February — down from 70% in November 2021 — according to research recently <a target="_blank" href="https://www.reuters.com/business/autos-transportation/would-be-tesla-buyers-snub-company-musks-reputation-dips-2024-04-01/">published</a> by Reuters. Some Tesla owners had previously told BI that they were rethinking their allegiance to the brand due to <a target="_blank" href="https://www.businessinsider.com/elon-musk-twitter-antics-causing-tesla-owners-ditch-car-brand-2023-1">concerns over Musk</a>.Tesla is also facing headwinds in China, where it's losing ground to fierce local competitors like BYD.BYD sells one <a target="_blank" href="https://www.businessinsider.com/byd-seagull-cheap-ev-electric-car-tesla-china-2023-4#this-sleek-little-hatchback-is-one-of-the-best-deals-on-the-electric-car-market-but-dont-get-your-hopes-up-too-much-you-cant-buy-one-in-america-1">EV model</a> for less than $10,000 in China, where Tesla's Model 3, by comparison, costs about $32,000.Tesla's share of the Chinese auto market fell to 6.7% in the quarter ended December, compared to a 10.5% share in the first quarter last year, Bloomberg <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-03/tesla-also-losing-ground-in-china-as-it-disappoints-globally">reported</a> based on China's Passenger Car Association data.<h2>Time will tell for Tesla</h2>It's still not entirely clear when a new more affordable model might arrive, though Musk floated the possibility of early 2025.Elon Musk has a history of <a target="_blank" href="https://www.businessinsider.com/elon-musk-says-he-sets-unrealistic-timelines-has-an-issue-with-time-2018-6">overpromising on timelines</a>. The Cybertruck, for example, was supposed to go into production in 2021. Deliveries to customers didn't start until late 2023.If and when the cheaper car does arrive, it may take off. Renault has had some recent success with <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-23/renault-beats-revenue-estimates-on-clio-megane-e-tech-sales?campaign_id=4&amp;emc=edit_dk_20240424&amp;instance_id=121379&amp;nl=dealbook&amp;regi_id=194893788&amp;segment_id=164638&amp;te=1&amp;user_id=2259c117e2d6d1f3b6de8de6262da403">lower-priced EVs</a>, for example. It could make Tesla more attractive in markets like <a target="_blank" href="https://www.businessinsider.com/tesla-would-spur-growth-in-india-ev-market-rival-says-2024-4">India</a>. Maybe the pool of buyers for a cheap Tesla will be ginormous. Betting against Elon Musk has been a losing proposition over time.But it's worth considering what might happen if it's not an instant success.

What if no one wants a cheap Tesla?      

When Tesla CEO Elon Musk was asked in 2011 about the Chinese electric-car maker BYD — a <a target="_blank" href="https://markets.businessinsider.com/news/stocks/byd-stock-sales-warren-buffett-berkshire-hathaway-china-ev-munger-2023-11">Warren Buffett-backed</a> company focused on cheaper eclectic vehicles with a name short for Build Your Dreams — he simply laughed it off. "Have you seen their car?" <a target="_blank" href="https://www.bloomberg.com/news/videos/2023-12-27/in-2011-tesla-ceo-musk-mocked-chinese-competitor-byd-video">he said with a giggle to Bloomberg TV</a>, adding that BYD didn't "have a great product" and "the technology is not very strong."Musk's juvenile expression of hubris was (and still is) singular, but his belief that China's automakers were not a threat was shared across the US auto industry at the time.A lot can change in 13 years. BYD eclipsed Tesla in 2023 as the best-selling EV maker in the world. One out of every three electric cars sold is made by the company, up from <a target="_blank" href="https://www.bloomberg.com/news/features/2023-06-26/china-s-electric-vehicle-bubble-is-starting-to-deflate?embedded-checkout=true">15% in 2020</a>.Instead of laughing off the competition, Musk is now sounding the alarm on threats from Chinese automakers. On a conference call with investors in January, he said Chinese EVs would "pretty much demolish" other American carmakers if allowed to enter the US. America's biggest car companies have also started to recognize that they must figure out how to make electric cars cheap as soon as possible before China eats their lunch.While the likes of Tesla, GM, and Ford are rolling out a handful of high-priced luxury EV models, Chinese companies already offer a slew of options across a range of price points: starter EVs, beater EVs, ones for getting from point A to point B. And while the American automakers are still trying to win over consumers just in their own country, Beijing is already planning to work around trade barriers and get these cars sold around the world, including in the US."The thought that Chinese-quality engineering and design are not as high quality as the legacy carmakers — that should be put to bed," Tu Le, the founder of Sino Auto Insights, a consultancy focusing on the Chinese EV market, told me. "Right now, the legacies don't have competitive products. There's a vacuum. If China EV Inc. were allowed to enter the US today or next year, the legacies would be gutted."We are witnessing a shock to the global automotive order unseen since Japan barreled into the market in the 1970s. China's EV ascendance has sparked a fight that is forcing companies to stretch the limits of their technological capability and policymakers to reimagine the ideological underpinnings of decades of trade strategy. What's at stake is nothing less than a US industry worth $104 billion, about as much as <a target="_blank" href="https://www.trade.gov/country-commercial-guides/angola-market-overview">Angola</a>'s national GDP, and all the 3 million jobs that come with it."It's a global game. It has been a global game," Le said. "Motherfuckers just haven't been paying attention."It's safe to say EVs have moved beyond the "early adopter" phase of the technological life cycle and are now working to conquer mainstream car buyers in the US. In 2023, 1 million were sold in the country for the first time, up from 918,500 in 2022. Despite this growth, there have been flashing red signs that American automakers' strategy — making EVs that are just like combustion-engine cars but about $10,000 more expensive — isn't working. Projections for sales growth in the years ahead have come down, and consumers have expressed dissatisfaction with the crop of cars available. To overcome that, carmakers have realized they must lure customers with cheaper models. Earlier this month, Ford CEO Jim Farley said his company was "<a target="_blank" href="https://www.businessinsider.com/ford-tesla-model-2-elon-musk-jim-farley-electric-vehicles-2024-2">ruthlessly</a>" focused on developing a more affordable mass-market car. Tesla has been saying a cheaper car is on the way for years, without success (<a target="_blank" href="https://www.businessinsider.com/tesla-elon-musk-to-build-affordable-electric-car-report-2023-11">yet</a>).While US carmakers are still figuring out how to please a wide variety of customers, Chinese brands have EVs in about every form imaginable. Want a $10,000 car? Try the BYD Seagull. Want a luxury SUV that can float in water? That's the <a target="_blank" href="https://robbreport.com/motors/cars/byd-yangwang-u8-suv-waterproof-boat-mode-1235029369/">BYD U8 Premium Edition</a>. Want something more luxurious? Chery, another Chinese carmaker, launched a sexy EV sports car with scissor doors called the iCar, which costs between $21,800 and $58,000. China's ability to expand its suite of offerings comes down to cost. Of course, the US has higher labor costs, but China has also taken great pains to own the EV supply chain. Legacy carmakers are still searching around the world to source the raw materials and parts they need, a project the Chinese government has been working on for over a decade. In fact, many of these companies are selling their products to American firms: Tesla buys batteries <a target="_blank" href="https://www.cnn.com/2022/06/08/tech/byd-tesla-ev-batteries-intl-hnk/index.html">from BYD</a>, for example. That doesn't mean Chinese car companies aren't facing challenges. While the US's strategy (or lack thereof) has left us without enough chargers or the right kind of inventory, China has the opposite problem. It has too many EVs, too many EV makers, and a flagging domestic economy. China EV Inc. needs to expand to new markets. The future of the auto industry hangs on whether it can start to do that before the rest of the world can catch up.The year Musk tittered at the idea of Chinese EVs overtaking Tesla, the country produced only <a target="_blank" href="https://macropolo.org/analysis/china-electric-vehicle-ev-industry/#:~:text=In%20December%202019%2C%20the%20Chinese,overall%20vehicle%20sales%20by%202025">5,000 electric cars</a>. But Beijing's plan to dominate the global EV space was already well underway. The Chinese Communist Party started out by setting the goal of having EVs make up 25% of all cars sold in China by 2025 and showered money on companies with <a target="_blank" href="https://theicct.org/subsidy-fraud-leads-to-reforms-for-chinas-ev-market/">anything even resembling a plan</a> to contribute to that goal. At the same time, the government set about marshaling all the raw materials Chinese companies would need for EV batteries and drivetrains, creating a domestic ecosystem for suppliers. In this way, its industrial policy for EVs copied past plans to dominate <a target="_blank" href="https://gmk.center/en/posts/chinas-overcapacity-problem-returns/#:~:text=Throughout%20most%20of%202023%2C%20Chinese,excess%20steelmaking%20capacity%20in%20China.">steel</a> and <a target="_blank" href="https://prosperousamerica.org/is-china-overproducing-solar-again-iea-report-says-yes/#:~:text=China%20accounts%20for%20almost%2090,energy%20forecast%20report%20this%20month.">solar panels</a> — flood the market with supply until Chinese manufacturers were the only game in town.But in 2016, the CCP changed course. The grant money for EV research and development petered out, and the government announced that by 2027, it would phase out subsidies that lowered the price of electric cars for consumers. Beijing also instituted policies that opened the door for foreign carmakers to invest more in China's domestic industry and move manufacturing there. The result was pure carnage for China's domestic EV industry. Companies that depended on Beijing for subsidies <a target="_blank" href="https://techcrunch.com/2023/10/10/wm-motors-bankruptcy-highlights-challenges-faced-by-ev-startups-in-china/">began to implode</a>, and small players got pushed out of the market. But the chaos ended up strengthening the country's auto sector, ensuring that the most competitive carmakers gained market share. What emerged started to look more like a more mature industry — one with the capacity to manufacture world-class products. Last year, China became the <a target="_blank" href="https://www.wsj.com/world/china/china-vehicle-sales-rise-further-boosted-by-stimulus-policies-sales-promotions-3452cca1">world's largest auto exporter</a>.<div type="image" title="Chinese President Xi Jinping makes a toast after delivering his speech at a dinner marking the 74th anniversary of the founding of the People's Republic of China at the Great Hall of the People on September 28, 2023 in Beijing, China." height="3333" width="5000" msid="107986484" hostid="261"></div>None of this means the road ahead is any easier for the victors of Beijing's EV wars. Chinese automakers now have to deal with slower domestic demand as the Chinese economy enters a <a target="_blank" href="https://www.businessinsider.com/china-economy-shrinking-xi-jinping-debt-real-estate-american-world-2024-1">protracted phase of slower growth</a>. At the same time, they know that their growth and success are central to the vision of China's technological landscape that its leader, Xi Jinping, has. Slowing down is not an option. The sector is expected to add <a target="_blank" href="https://www.wsj.com/business/autos/china-electric-vehicle-demand-slowing-b4e78636">capacity for 5 million more cars</a> (most of them EVs) by 2025. Domestic sales are projected to reach only 3.7 million in that same period. Sales for standout startups such as <a target="_blank" href="https://www.scmp.com/business/china-business/article/3250622/chinese-ev-builders-li-auto-xpeng-and-nio-get-2024-slow-start-sharp-drop-january-sales">Nio, Li Auto, and XPeng</a> are already coming in lower than expected. BYD alone has built enough capacity to manufacture 4 million cars in China. In 2023, it sold <a target="_blank" href="https://www.google.com/search?q=how+many+cars+did+byd+sell+in+2023&amp;rlz=1C5GCEM_enUS1082US1094&amp;oq=how+many+cars+did+BYD+s&amp;gs_lcrp=EgZjaHJvbWUqBwgAEAAYgAQyBwgAEAAYgAQyBggBEEUYOTIHCAIQABiABDINCAMQABiGAxiABBiKBTINCAQQABiGAxiABBiKBagCALACAA&amp;sourceid=chrome&amp;ie=UTF-8">3 million</a> cars total.All these cars need somewhere to go, and for China EV Inc., the more profitable option is to move them west — first to Europe, where trade barriers are easier to overcome (for now), and eventually to the US. That is why brands such as BYD, Chery, and SAIC are all in discussions with the Mexican government to expand operations there. They need a toehold in North America to even begin conquering the US market. In the meantime, the US government is trying to spend an EV-parts ecosystem into existence, in part by handing out <a target="_blank" href="https://ir.novonixgroup.com/news-releases/news-release-details/novonix-finalizes-us100-million-grant-award-us-department-energy">grants</a> from the Energy Department to domestic companies working on battery technologies.No country wants to lose its automotive sector, so in Brussels and Washington, the rise of China's national champions has become a thorny topic between international-trade interlocutors. In public forums, Chinese trade apparatchiks have talked a good game <a target="_blank" href="https://www.ft.com/content/608c4b00-8efb-4322-9318-f6249096e3fe">about culling excess capacity</a> to assuage the fears of their counterparts. But at the same time, Beijing has put out an 18-point plan to counter trade restrictions and <a target="_blank" href="https://substack.com/redirect/3773ebf0-ac03-4983-8afd-9613e3ad9cbb?j=eyJ1IjoicDBuIn0.8PdnrzqVrhaSNasEauWg-AT6mGSX3AX-3rO2hxEVAZ8">push Chinese EVs out to the world</a>. None of this is really up for negotiation.To dominate the global market, Chinese automakers have to find ways to slip around the various barriers Western nations have put up. To crack Europe, BYD has announced plans to <a target="_blank" href="https://apnews.com/article/chinas-byd-building-electric-vehicle-plant-hungary-4c4754f43703d061e1dc02516be0c14a">build a factory</a> in Hungary. Cracking the US is more complex. It has more trade barrier protection from a China Auto Inc. onslaught, but it may not work forever.Take, for instance, America's taxes on Chinese EV imports. The Trump administration smacked a 25% tariff on Chinese EVs, bringing the total levy for their entrance to the US up to 27.5%. To avoid the tariffs, brands like BYD, Chery, and SAIC are all in discussions with the Mexican government to expand operations there."Most likely, the way Chinese companies would be able to participate in the US EV market would be by investing in the Mexican auto-parts sector," <a target="_blank" href="https://www.piie.com/experts/senior-research-staff/mary-e-lovely">Mary Lovely</a>, an economist and senior fellow at the Peterson Institute, told me.Parts that come from Mexico would be considered North American-made and subjected to lighter restrictions under the US-Mexico-Canada trade agreement. EVs fully built in China would also not be eligible for a $7,500 tax rebate for consumers created under President Joe Biden's Inflation Reduction Act. They would be eligible, though, if they were built in Mexico and met specific battery-sourcing requirements. For some stakeholders, the barriers aren't high enough. US consumers have shown that if the price is low enough, "Made in America" takes a backseat. That's why the United Auto Workers union is already so worried about Chinese cars that <a target="_blank" href="https://selectcommitteeontheccp.house.gov/sites/evo-subsites/selectcommitteeontheccp.house.gov/files/evo-media-document/11.7.2023-letter-to-ambassador-tai-auto-301.pdf">it has asked</a> the White House to raise tariffs even more. The <a target="_blank" href="https://www.wsj.com/economy/trade/biden-administration-explores-raising-tariffs-on-chinese-evs-e439d87d">Biden administration</a> has said it's seriously <a target="_blank" href="https://subscriber.politicopro.com/f/?id=0000018d-1903-dc2e-a3ad-79c31af10004">considering such a move</a>.This auto industry has become caught up in the existential question that is bedeviling societies all over the world — is globalization worth it? In this case: What do we care about more, preserving the auto industry or giving consumers a variety of cheap EVs to choose from?"We want to maintain an auto industry in the US — that's essential for jobs, national security, and for other sectors of the economy," Lovely said. "But then the question is how much protection do you need, recognizing that it's not a free lunch. This is why people don't like economists. We keep reminding people none of this is free."There is no telling how this will all shake out. Sure, Chinese EV makers are lean and mean, but they've never had to deal with international markets before. Beijing is used to dealing with foreign brands entering its market, not the other way around. For most of China's rise, it has operated in a cooperative world. Now it's operating in a world where its most important trading partners no longer trust Beijing. EVs collect so much data that policymakers have started to frame this debate as one not just about trade but also about national security. That's a harder debate for China to win.In the US, the race to counter China by building a cheaper EV is on. Tesla could pull ahead if delivers on its promise to get its $25,000 car out by 2025. But the company has a history of delayed product launches, an ongoing price war impairing cash flow, and an erratic, X-distracted CEO to deal with. Big Auto is contending with a more muscular United Auto Workers, more skittish shareholders, and management that has done nothing but fall behind. That said, America's legacy automakers have experience fighting for their survival and winning. Whatever happens, what is guaranteed is a transformation of the auto industry.<a target="_blank" rel="" href="https://www.businessinsider.com/author/linette-lopez">Linette Lopez</a> is a senior correspondent at Business Insider.

Elon Musk relied on China to fuel Tesla's rise. Now Beijing is turning on him.

REUTERS/Rodrigo GarridoLA recently ordered 130 buses from Chinese company BYD. It's the largest order of electric buses in the US.<ul class="summary-list"><li>In November, the Los Angeles Department of Transportation (LADOT) ordered 130 electric buses from the Chinese company BYD. It's believed to be the largest order of e-buses in US history. </li><li>The buses are part of the LADOT's plan to make its entire fleet electric by 2030, with a total of about 511 e-buses. </li><li>Business Insider talked with the transportation department's chief of transit, Corinne Ralph, about what it will take to transition the fleet, which services the second-largest city in the US - in just 10 years. </li><li>She said the two biggest challenges are power and cost. Utilities will have to meet a huge surge in demand, and the price for buses and the infrastructure to support them amounts to tens of millions of dollars. </li><li>Do you have a tip or story idea about the business of energy? Contact this reporter at <a href="mailto:bjones@businessinsider.com">bjones@businessinsider.com</a> or through the encrypted messenger app Signal at 646-768-1657. </li><li><a href="https://www.businessinsider.com/prime">Click here for more BI Prime articles</a>.</li></ul>Los Angeles is best known for beautiful celebrities, sandy beaches and, of course, traffic. So it might come as a surprise that in just 10 years, a portion of the city's entire public transportation fleet - buses that service downtown LA and 27 neighborhoods - will be 100% electric. The city has just four electric buses today. By 2030, it's planning to have about 511, officials said. That set the stage for a historic purchase the city made last month: The transportation department ordered 130 e-buses from the Chinese company BYD, which is considered the largest sale of electric buses in the nation's history. Affording those buses is just one challenge that Corrine Ralph, LA's chief of transit programs, faces in this transition. In an exclusive interview with Business Insider, she explains what it will take for a city of roughly 4 million to go all-electric. "Buses play a major role [in greenhouse gas emissions], partly because we are on the streets for much longer," Ralph said, signaling that electric buses are an essential part of the city's zero-emissions strategy. "It's no longer a choice. This is going to be something that we all have to do." LA DOTThe battery of an electric bus<h2>What it costs to reach zero emissions </h2>Buses are not cheap. And electric buses are as expensive as they come. The 130 e-buses that the city of Los Angeles bought are roughly $650,000 each, Ralph says - or about $175,000 to $225,000 more expensive than the gas-powered buses in the city's fleet. Multiply that by 511 and you're staring at more than a third of a billion dollars. That price tag doesn't take into consideration the cost of training or the charging infrastructure. For LA County, infrastructure could cost up to $1 billion, according to notes from a <a href="https://boardagendas.metro.net/event/operations-safety-and-customer-experience-d46fc444cf85/">2019 committee meeting</a>. "Agencies do not anticipate the amount of dollars it's going to take for you to install the necessary infrastructure," Ralph said. "I think the costs of the buses and the cost of infrastructure hours I need are the two biggest challenges that we have."Ralph says the sheer cost of electrifying public transit has generated "a certain amount of concern in terms of the dollar figures." No doubt, other cities, especially those with much smaller budgets, will have trouble footing the bill. "A lot of agencies are not able to find that additional funding to be able to do that," she said.But here's the thing: Electric buses have been shown to save money in the long-run.Transit officials in Chicago, for example, say that just two e-buses save the city <a href="https://www.transitchicago.com/cta-expands-electric-bus-fleet/">$24,000 in fuel costs</a> and $30,000 in maintenance costs each year, not to mention the benefits linked to improved air quality. Cities can apply for federal and state grants to help cover the costs. In 2019, the Federal Transit Administration announced that it awarded nearly $85 million in grants through its Low or No Emissions Grant program. "We have been budgeting and going after grants aggressively in order to be able to bind down the cost, at least of the buses," Ralph said. Aggressive is right. In 2018, LADOT <a href="https://ladot.lacity.org/sites/g/files/wph266/f/Press%20Release%20Transit%20Awarded%20%2436.1%20Million%20Toward%20Purchase%20of%20Electric%20Buses.pdf">received a grant</a> from the California Transit and Intercity Rail Capital Program, a government grantmaking agency, to purchase 112 e-buses. LA DOTAn electric bus operated by LA DOT outside of Griffith Observatory in LA<h2>The next challenge: Power. What happens when you plug in hundreds of buses? </h2>The 130 electric buses will start to arrive in early 2021, Ralph says. And one of her big concerns, leading up to that day, is how the city will provide enough electricity to charge them. Each BYD bus has a battery capacity of 215 kWh, which is roughly equivalent to the daily power consumption of <a href="https://www.eia.gov/tools/faqs/faq.php?id=97&amp;t=3">7 American households</a>. "The power need is a fairly significant challenge to overcome," she said. "There is a lot of demand that's going to be required of the utilities. It's a lot of pressure on their own equipment as well." Utilities might need to put more power on the grid, she says, not to mention new infrastructure to support the buses. But there's a simple way to confront the challenge of demand: talk to the utility in the months or even years leading up to the transition. She, for one, attends weekly meetings, where the city and its utility, the Department of Water and Power, discuss how much power they'll need, and when. There are also a few ways to reduce demand, Ralph says. Public buses can charge in the middle of the night, for example, when there's less stress on the grid and the cost of electricity is cheaper. "The fact that we're operating during off-peak where there's no demand really puts a handle around our costs," she said.And what about onsite storage? Or the ability to plug buses back into the grid when power usage is peaking? Ralph says the city's transportation department is currently looking into it, but there are no concrete plans yet. <h2>LA's e-bus purchase is impressive. Until you look at what China is doing. </h2>There were nearly 425,000 electric buses globally <a href="https://www.bloomberg.com/news/articles/2019-05-15/in-shift-to-electric-bus-it-s-china-ahead-of-u-s-421-000-to-300">at the end of 2018</a>. And 99% of them were in China. In fact, some cities in China have more e-buses than the entire US. The southeastern Chinese city of Shenzen with its 12 million people, makes Los Angeles, with its roughly 4 million people, look like a quaint college town. Shenzen's public bus fleet - consisting of a staggering 16,359 buses - is <a href="https://www.wri.org/blog/2018/04/how-did-shenzhen-china-build-world-s-largest-electric-bus-fleet">100% electric</a>. But that's not to say that introducing 130 new electric buses in LA won't make a difference.According to the LADOT, the addition will offset the city's carbon footprint by 233,450 metric tons over 12 years, which is equivalent to taking more than 4,000 gas cars off the road over the same period. <a href="https://www.businessinsider.com/intelligence/future-of-retail?IR=T&amp;itm_source=businessinsider&amp;itm_medium=ctgr_bii&amp;itm_term=ctgr_leadgen&amp;itm_content=transportation&amp;itm_campaign=future-of-retail-2"></a> <h3>NOW WATCH: <a href="https://www.businessinsider.com/million-mile-battery-tesla-miles-lifetime-2019-11">Here's how the million-mile battery could lead to Teslas lasting a lifetime</a></h3>

LA purchased 130 electric buses - the largest order in the US. The city's chief of transit reveals the challenges ahead in electrifying the country's 2nd-largest city.

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