Shenzhen Hits Drivers' Pockets to Minimize Gridlock in Booming City

China: Shenzhen to Levy "City Entry Fee"

Shenzhen, a harbor city in Guangdong Province of southern China, is planning to levy "city entry fee" to relieve traffic in the city. The plan, scheduled to become effective within three years, will be initially targeted at the small sedans and gradually widen to cover other types of vehicle.

Shenzhen will become the first city in China to levy the "city entry fee," which has been adopted in several other cities of the world. There are over one million cars in Shenzhen, and the number is growing by over 20% a year.

Shenzhen Mayor Xu Zonghen first unveiled the plan in a city development report presented to the National People's Congress in 2007. "Most of the revenue collected under the new policy will be used to develop public transportation as a convenient alternative for commuting," said Xu. One of the planned developments is the extension of the subway system to a total length of 177 kilometers by 2011 and an estimated daily volume of four million passengers.

Brazil Considers Favorable Tax for Multi-fuel Cars

The Brazilian government considers offering favorable taxes as an incentive to encourage carmakers to produce multi-fuel cars, which the South American country regards as the best choice of vehicles to be used in urban areas where traffic is heavy and the optional use of natural gas would pay off.

In recent years, sales of the multi-fuel cars have grown rapidly in Brazil with the help of government policies. "We aim to export both multi-fuel cars and related technologies," said Minister of Development, Industry, and Foreign Trade Luiz Fernando Furlan.

Brazil unveiled its first multi-fuel car, the Astra Multipower 2.0 sedan, in 2004. The Astra can run on gasoline, alcohol or any combination of the two, as well as natural gas. President Luiz Inacio Lula da Silva took drove the vehicle on the day of its launch.

Vehicle output and sales in Brazil have been growing quickly over the last couple of years thanks to solid economic growth and falling interest rates. Domestic vehicle sales are expected to reach 2.88 million units in 2008.

EU's Auto CO2 Restriction Draws Mixed Reactions

The European Union (EU) passed a new automobile carbon dioxide (CO2) emission standard last December, targeted at cutting car CO2 emissions by 25% by 2012. The EU would impose heavy penalties on automakers that fail to produce cars that comply with the new standard.

Under the new restriction, all automobiles sold in the EU market cannot emit more than 120 grams of CO2 per kilometer, compared to the average of 160 grams now. Cars that fail to meet the standard will be fined 20 euros per gram of CO2 over the ceiling, and the penalty on the same car will increase incrementally to 95 euros by 2015.

The new CO2 restriction has drawn mixed reaction from European carmakers. German and Swedish carmakers, which generally produce larger cars, have protested the tougher standard, whereas French and Italian carmakers, which lead in the small car market, are supportive.

The new restriction is estimated to raise auto production costs and car prices by 6%, or around 1,300 euros. Car owners, however, are expected to save around 2,700 euros in fuel expense.

To reduce the impact of the new rules on makers of large cars, the EU will allow producers of large cars to purchase quotas from makers of smaller cars, so their average CO2 emission meets the new requirement.

This new requirement is criticized as a policy at the expense of German carmakers, especially Mercedes-Benz and BMW, whose cars emitted 100 grams and 184 grams of CO2 per kilometer, respectively, in 2006.

Italy: Milan Starts "Ecopass" Program

Borrowing a page from London, Stockholm, and Singapore, Milan aims to improve its air quality through an "ecopass" program under which the Italian city will levy a "city entry fee" or "pollution fee" from cars entering the city between 7:30 am and 7:30 pm on weekdays. Drivers that don't pay the fee will be fined at least 70 euros.

An estimated 90,000 or so cars enter Milan every weekday, generating a level of air pollution exceeding the ceiling set by the EU. The "ecopass" program covers downtown Milan and an area of eight kilometers around it. Cars entering the area during the fee period must pay a pollution fee of two to ten euros.

Electric and hybrid cars are excluded from the fee. The Milan City Government expects to collect 24 million euros annually and will use two thirds of it to improve public transportation, including a project to double the size of the subway system by 2015 and encourage the purchase of electric and hybrid cars.

Taiwan to Promote Electric Cars and Bikes

Yulon Motor has teamed up with several electrics companies to turn out Taiwan's first plug-in electric car within three years. The cooperation project, with a budget of NT$3 billion, is scheduled to hammer out a blueprint this year and formally launch the car by 2011. The electric cars produced under the project will not only serve the domestic market in Taiwan, but will also be exported to other areas in the Greater China market.

In addition, the Industrial Development Bureau (IDB) under the Ministry of Economic Affairs in Taiwan has a two-phase plan to encourage scooter makers to produce electric bikes.

Last November, the government began offering low-interest loans to scooter makers. It also asked the Industrial Technology Research Institute (ITRI) to provide technological assistance to scooter makers, with a goal of producing 1,500 electric scooters in Taiwan during the first phase. The second phase will start in 2009, when there will be battery-recharge stations to serve electric scooters islandwide.

The government's plan will initially focus on leisure scooters at popular travel destinations and gradually expand to make electric scooters an accepted alternative form of transportation. Acceptance of electric scooters is expected to grow as petroleum fuel prices in Taiwan soar to NT$35 per liter.

New York to Promote Electric Cars and Bikes

New York City is planning to develop new bike lanes for bicycle riders, hoping to make the city more environmentally friendly.

"The city plans to experiment with a heavily buffered bike lane in one part of Manhattan's Chelsea neighborhood," said City Transportation Commissioner Janette Sadik-Khan last September. The plan will separate bicycles from auto traffic by a strip of pavement and a lane of parked cars, and reduce the number of car lanes from four to three. Several European cities have adopted a similar plan.

The project, with a budget of US$1 million or 710,000 euros, is aimed at improving biker safety. Around 300 cyclists were seriously injured in New York in 2006. "The protected bike lane would provide a powerful incentive for people to ride a bike as an alternation of transportation means," said a cycling advocate in the city.

Vietnam Makes Bold auto Investment Plan

With optimism over the prospect of the domestic auto market, the Vietnamese government set a bold annual car sales target of 100,000 units for 2008. According to the Ministry of Industry and Trade, car sales in 2007 reached around 80,000 units and would easily exceed 100,000 units this year. To boost car sales in the country, the government is mulling another tax cut for cars in the near future.

"The (domestic) car market doubled in 2007 and could maintain a growth of at least 20 to 30% in 2008," said Bui Ngoc Huyen, Director of Xuan Kien Automobile Private Establishment (Vinaxuki).

Huyen also said that bright market prospects have prompted automobile manufacturers to expand investment. Vinaxuki has one of the most ambitious auto investment plans in Vietnam. It aims to set up an auto factory in Nghi Son Economic Zone specialized in making car parts, accessories and engines, with a target of producing its first own-brand car in 2010 at a price of at least 15 to 20% lower than imports.

Toyota Vietnam currently runs the largest auto assembly line in the country, with an annual output of 20,000 units in 2007. The company plans to expand investment and raise annual output to 25,000 units in 2008 and 30,000 units in 2009. "We will invest another US$50 million during the 2007 to 2009 period, roughly twice that for the period of 2004 to 2006," said Nobuhiko Murakami, Director General of Toyota Vietnam.