We’ve written before about the Wuling Hongguang Mini EV. The Chinese minicar is a product of General Motors and Wuling. It is the hottest-selling new car in China. GM is expected to sell over 400,000 in 2021. That should represent a lot of profit, right?
Is the Mini EV’s popularity due to its price or GM’s profit?
It stands to become the best-selling electric vehicle in the world. Part of that demand and popularity might be seen as being its price. But that price doesn’t make much for Wuling. So what is it?
CarNewsChina has compiled some curious numbers that reveal some interesting facts. The site calculated that if Wuling sells 500,000 cars it will make a profit of $7.8 million. That represents an RMB89 profit for each car. That’s $14 in US money.
But even that small amount of profit is not what Hongguang is about. In this case, it is about carbon credits. For every Mini EV sold Wuling gets two carbon credits. Each carbon credit is worth RMB3,000 or $464 in US money.
The Mini EV is actually worth a lot more than $14 profit to GM
So the Mini EV is worth almost $1,000 to Wuling. Each. With 560,000 Mini EVs sold, that represents almost $260 million in credits. But there are other benefits that come with the sale of Mini EVs.
There is a lot of media that is generated from news about the Mini EV-like the post you’re reading now. It creates brand recognition-even in markets the Mini EV isn’t sold in. When the Tesla Model 3 was surpassed by the Mini EV a number of times last year it brought a wave of publicity.
There is something intrinsically compelling to Chinese buyers about the Mini EV
And if you’re thinking that the price is the reason for selling so many, it actually isn’t. There are a number of EVs sold in China that have a cheaper price than the Mini EV. So there is something intrinsically compelling to the Chinese about the Mini EV. Soon, we’ll see if it has the same appeal in Europe.
An upgraded Mini EV will hit some European markets soon. Sold as the FreZe Nikrob, it gets a larger battery pack and some structural improvements. That 13.8 kWh battery gives it a range of 125 miles.