The recent recall of Chinese electric vehicles (EVs) in Australia due to electrocution risks highlights the challenges facing the rapidly expanding global EV market. Great Wall China, a prominent Chinese EV manufacturer, has issued a recall for its 2023 model, the Ora, in Australia, underscoring the complexities of international market expansion and consumer safety.
The Issue at Hand
The recall, as detailed in a notice on an Australian government website, stems from a programming issue where removing the charging cable without cancelling the charge could cause an electrical arc between the charging plug and the vehicle. This issue poses a significant risk, as the notice states, “If an electrical arc comes into contact with the operator or bystanders, it will increase the risk of serious injury or death.”
The Scope of the Recall
The recall affects 1,659 vehicles in Australia and approximately 520 in New Zealand. This situation is not unique to Great Wall China; other EV manufacturers, including Tesla, have faced similar recalls. For instance, Tesla recalled over 362,000 vehicles in the U.S. earlier this year for issues related to its Full Self-Driving Beta.
Competitive Pricing and Market Disruption
The recall comes at a time when Chinese EVs are making significant inroads into various international markets, including Europe, Southeast Asia, and Australia and New Zealand, due to their competitive pricing. For example, the Ora was sold in Australia for about US$26,400, undercutting other Chinese EVs like MG’s MG 4 and BYD’s Dolphin.
BYD’s Seagull, launched in China earlier this year at approximately $11,000, has become one of the nation’s best-selling EVs. Its affordability poses a potential disruption in markets like Latin America, Africa, India, and Europe, where demand for affordable, quality EVs is high.
Challenges in Building Trust
Despite their competitive pricing and technological advancements, Chinese EV makers face significant challenges in building consumer trust in foreign markets. Historical precedents show that winning hearts and minds in the automotive industry can take decades, as was the case with Japanese carmakers. A YouGov survey in Germany revealed that only 1% of consumers aware of Chinese EV brands would consider buying one.
Recalls like the one issued by Great Wall China can further erode consumer confidence. Safety concerns, especially those as serious as electrocution risks, can significantly impact the reputation of emerging EV brands trying to establish themselves in competitive international markets.
As the EV market continues to grow, manufacturers must balance the drive for competitive pricing and market expansion with stringent safety standards. The recall in Australia serves as a reminder of the importance of thorough testing and quality assurance, especially when entering new markets with different regulatory landscapes.
The incident also underscores the need for continuous innovation and improvement in EV technology, not just in terms of performance and cost-efficiency but also in ensuring the safety and reliability of these vehicles. As the industry evolves, consumer trust will be paramount, and manufacturers must prioritize safety to build and maintain this trust.
The recall of Chinese EVs in Australia due to electrocution risks is a significant setback for Great Wall China and other Chinese EV makers. It highlights the challenges of expanding into international markets and the importance of prioritizing consumer safety in the rapidly evolving EV landscape.