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China's Cars, Accelerating A Global Demand for Fuel
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All this growth is more than offsetting the conservation measures taken in the United States, Europe and other industrialized nations. This year, the combined consumption of China, India, Russia and the Middle East will increase 4.4 percent and for the first time exceed that of the United States, according to the International Energy Agency.
For energy planners in the industrialized world, this is a cruel irony, coming after a concerted effort by consumers and lawmakers to steer consumption downward. If China continues to increase its use of oil at the average pace of 6 to 7 percent a year, as it has since 1990, it will consume as much as the United States in more than 20 years.
But China bristles at criticism of its growing oil use, noting that per capita it will remain a small fraction of U.S. consumption for decades to come. Moreover, industrialized nations all relied on heavy petroleum use as they developed. Why should we be penalized, the Chinese ask, for coming late to the game?
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While a number of factors contribute to China's surging demand, including rapid industrial development and hoarding by the government to ensure adequate supplies for this summer's Olympic Games in Beijing, it is autos that are having the biggest impact.
Yet despite this dizzying increase in passenger cars, less than 4 percent of the country's 1.3 billion people have already bought one. That's where the United States was in 1915.
"The entire energy market of the world is being affected by this country already. Can you imagine when we get to 50 people out of every 1,000 in China owning cars?" asked Friedhelm Engler, design director for General Motors and Shanghai Automotive Industry's joint-venture engineering and design lab in China.
For the previous generation, owning a car was the province of a privileged few -- those in government, heads of state-owned companies and others in positions of power.
But starting in 2000, China began to aggressively promote consumption to balance its export-driven, white-hot economy. Zeng Peiyan, who was then director of the national planning committee, created a list of things average citizens should be encouraged to buy. At the top of that list was cars.
Beijing has simplified procedures for buying cars, cut sales taxes and improved the availability of bank loans. It encouraged local governments to build more parking areas. It banned bicycles on some larger streets. And it laid thousands of miles of gleaming, multi-lane superhighways around the country.
In the meantime, gas has been kept artificially cheap. Even after subsidies were partly lifted last month, a gallon of gas in China costs only $3.40, well below market prices.
Some Chinese cities actually promote bigger, fancier cars to help foster the image of a more "wenming," or civilized, modern society.
