While SUVs and crossovers remain dominant in this year’s Shanghai Auto Show, the segment that is really turning heads right now are, quite surprisingly, plug-in hybrids.
Foreign car brands Audi, Cadillac, Hyundai and Mitsubishi as well as domestic manufacturer BYD showcased plug-in hybrids at the show, which opened on Wednesday, that is geared toward meeting China's tightening fuel economy standards.
While SUVs generate handsome sales and nice price profits, they do not help automakers meet Beijing's fuel-efficiency targets, said Yang Jian, managing editor of Automotive News China.
Currently, vehicles are mandated by law to average at least 34 mpg. By 2020, they must improve to no less than 47 mpg.
Audi, China's leading luxury car brand, revealed the Q7 e-tron 2.0 TFSI Quattro and the A6L e-tron during the show, and is expected to roll out the two models into the Chinese market along with the A3 Sportback e-tron, another plug-in hybrid, by next year. According to the company, the Q7 sips only 2.5 liters of fuel per 100 kilometers, while the A6l consumes just 2.2 liters.
Like Audi, Shanghai General Motors also introduced a plug-in hybrid variant of its Cadillac CT6 sedan. The CT6 uses just 2.0 liters of fuel per 100 kilometers, compared to vehicles imported by GM's joint venture that consumed 10.8 liters per 100 kilometer.
The trend is not just limited to luxury brands. Mitsubishi unveiled two plug-in hybrid SUV concepts at the show, while Hyundai introduced a plug-in hybrid version of its new Tucson SUV.
BYD Co., a Shenzhen-based automaker partly owned by U.S. billionaire investor Warren Buffett, also unveiled Song and Yuan compact SUVs and the Sang multipurpose vehicle, which were all plug-in hybrids. Emerging domestic manufacturers Geely and SAIC also introduced their own line of hybrids.
The auto industry's rush to introduce plug-in hybrids is expected to generate lucrative opportunities for suppliers such as ZF Friedrichshafen AG, which has a portfolio of hybrid technologies.
"We have received more requests than we can handle," said Ye Guohong, president of ZF Investment Co.