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BYD's Electric Taxi Fire
Summary:The share price of BYD took a hit after one of its taxis exploded in flames early Monday morning after being involved in a high-speed accident.


By Geng Huili (耿慧丽) and Xu Weiming (许伟明)
Issue 572, June 3, 2012
Auto, page 33
Translated by Song Chunling
Original article:
[Chinese]

Five days after an e6 battery-electric car produced by China's best-known electric car manufacturer, the Shenzhen-based BYD, was involved in a fatal car accident, experts from China's Ministry of Science and Technology have been sent to Shezhen to investigate the cause of the fire that engulfed the vehicle.

At the same time, the share price of BYD, a company in which well-known American investor Warren Buffet has a 10 percent stake, has also been hit by the controversy surrounding the accident, with almost 6 billion yuan being knocked off the company's market value at one stage.

The Accident

At about 3am on May 26, a 24-year old woman surnamed Zhang got into one of BYD's electric taxis with her friend in the southern city of Shenzhen. The taxi was later involved in an accident with a Nissan GT-R sports car. A third vehicle, a regular gasoline-fueled taxi, was also involved in the accident.

A passer-by later described the scene of the accident "What a fire! I took a picture and left immediately, worrying it may explode." A picture of the burning rear-end of the BYD taxi soon went viral.

Aside from concerns about the safety of electric cars, the accident also drew the attention of the public after people began to suspect that the man who later turned himself into police, wasn't actually the one driving the sports car that rear-ended the taxi.

According to BYD, the e6 taxi spun out of control after being hit and veered off the side of the road, where it hit a tree. The seriously contorted car later burst into flames.
The Shenzhen police later confirmed BYD's description of what happened. The Nissan first struck the e6 taxi while travelling at 180km/h and then crashed into the other taxi, overturning it. The e6 quickly caught fire after being struck and was burnt to a shell.

It's reported that emergency personnel at the scene said that both the passengers and the driver of the e6 taxi tried to open the door, but failed because the fire spread too quickly. Nobody in the other two cars was killed, while the driver of the other taxi was only slightly injured.

"We are also waiting for more information to be released as part of the accident assessment report," said a representative from BYD. "As we understand it, the battery did not explode and was only partly damaged." The electric taxi has since been taken away and sealed by the Shenzhen police.

The Cause

According to information revealed by BYD, the battery in the e6 taxi didn't explode. "Car batteries are different from mobile phone or laptop batteries, and they won't explode even when there is an open fire." BYD uses lithium iron phosphate batteries, which are safer and cheaper when compared with the nickel manganese cobalt (NMC) batteries used by Japanese and Korean companies.

The Controversy

This latest incident involving BYD's e6 has once again ignited worries about the outlook for the electric car industry in China. Skeptics question why the e6 caught fire after the accident, while the Jetta was not seriously damaged. BYD claims that "the e6 was hit first and the force of the crash was much heavier than that which hit the other taxi. In such an accident, regular cars can also catch fire."

BYD also said that the taxi only caught fire after the crash, which is different from former incidents involving the Zotye (众泰) electric car and an electric bus in Shanghai last year, in which both vehicles simply burst into flames. BYD's e6 model had already passed many safety tests and the battery had also reached a certain standard.

However, many are still worried that even if problems with the battery didn't cause this accident, that battery technology might still not be safe.

Experts are also worried that the launch of a "great-leap-forward" in the production of electric cars initiated in 2008 will bring about many problems.

Wang Zidong (王子冬) from the 985 national electric car power battery test center thinks battery companies in China are repeating the mistake of investing in low-quality battery manufacturing.

Chen Quanshi (陈全世), head of the Tsinghua automobile research institute, commenting on the Zotye accident, said that small companies without qualified (technology) should not be making electric cars.

The Standards

If it's later proven that the fire was related to the battery or the design of the electric car, not only will BYD face the consequences, but the whole electric car industry will take a huge hit.

However, what the public cares about, is whether electric cars pose greater risks than traditional gasoline cars after a crash.

After 6 months of investigation into a Chevrolet Volt fire that occured last year, U.S. regulators concluded that the battery of the Volt is safe and electric cars are not more likely to catch fire than gasoline cars. However not everyone has been persuaded by the findings of the invesitigation.

Chen Quanshi (陈全世) thinks the mass production of electric cars shouldn't be rushed and that stricter standards should be applied.

Wang Binggang (王秉刚) thinks the improved technology standards are essential in order to assure the public of the safety of the technology.

The Ministry of Industry and Information Technology has already set 26 compulsory standards for manufacturers of electric cars. However, given the current disorder in the electric car industry, the application of these standards has not been uniform.

After the accident, Wu Jingsheng (吴经胜), senior vice president of BYD, said that the rest of BYD's electric taxi fleet will continue to take to the streets and the accident will no impact on the company's confidence in developing new energy vehicles.

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