Amidst an industrial revolution with many hurdles to cross, it is crucial for NEV manufacturers to build better products and adopt a green management system in order to secure a core competitive edge in a narrow window of time before a new competitive landscape among incumbents kicks in. BAIC BJEV takes a three-pronged approach including putting in place a proper decarbonisation framework for the full life cycle of products, developing the cutting-edge “two-saves and one-smart” technology for better performance in emission reduction, and strengthening low-carbon business collaboration and exchange on the latest technologies and solutions.
“The first step is to have a proper decarbonisaton framework for the full life cycle of products, including setting product-specific targets, exploring low-carbon paths for three categories: raw materials, parts and vehicles, defining the role of each in emission reduction and combing R&D, procurement and production in building a carbon database. Virtual simulation will also be enhanced to drive a more efficient R&D process for low-carbon technologies”, a BAIC BJEV executive explained.
While sharpening its technological edge, BAIC BJEV also faces the challenges from its supply chain. To conserve energy and cut emissions from its supply chain and logistic operations, BAIC BJEV has proposed four paths: First, establish a carbon traceability database for first-hand information of carbon emission from the supply chain; second, build an effective supply chain management system to better manage towards low-carbon targets; third, pilot low-carbon projects in the supply chain to gradually transition towards low-carbon parts; fourth, break “strangleholds” in key low-carbon technologies.
It’s worth noting that while R&D capabilities and technological competitiveness remain crucial to NEV manufacturers, it is also of paramount importance for them to have the ability to cut costs and improve economic return with the help of green financial products, all the while honoring in earnest their commitment to green and high-quality development.
In January 2022, HSBC extended a working capital loan of RMB 300 million to BJEV, a subsidiary of BAIC Group, for the development and manufacturing of NEVs under BAIC’s own brand.
“This very first deal between BAIC BJEV and HSBC marks the beginning of a new win-win collaborative relationship between us. HSBC has been committed to supporting green and sustainable industries and has paved the way for us to get off to a flying start in the new year”, the BAIC BJEV executive said.
In addition to regular working capital loans, the two parties are also in the process of structuring factoring products that are eligible for government subsidies under the latest policy on new energy.