IDB Holding Corp. Ltd. (TASE:IDBH) is near to "closing final details" on its own electric car venture with Chinese car manufacturer BYD Auto. The venture will rival that of Shai Agassi's Project Better Place.
Israeli sources inform "Globes" that Discount Investment Corporation (TASE: DISI) is the representative party with the Chinese.
Israel's grandiose call to end its "dependence on oil" and its plans to launch nationwide infrastructure for recharging electric cars attracted attention worldwide and especially in China. In early August, company executives were quoted by Chinese news agency Xinhua as saying the company intended to market an electric car and a rechargeable hybrid car in Israel.
The executives were quoted following a visit by company executives to Israel. They reported being very excited by their visit, and their director of exports pointed to a meeting with President Shimon Peres who "enthusiastically supported" development of an electric car.
BYD completed development of its five-seater F3 electric car model two years ago, and is working as well on a minivan-type model. (There is currently a F3 model with a gas-powered engine). Its electric motor is powered by an innovative Lithium iron phosphate battery.
The parent company of the car manufacturer is Chinese battery concern BYD (HK: 0285) one of the world's largest battery manufacturers. This fact gives the small car company access to substantial R&D resources.
IDB, led by Nochi Dankner, is involved in nearly all areas of Israel's economy, but until now has not been directly involved in automobile imports. However, at least two of its strategic partners have quite a bit of experience in the field. The Lubinsky family, which has a 25% holding, is the importer of Peugeot and Citroen, and has a wide network of service and logistics centers. The Livnat family, who also holds 25%, has experience in Israel's truck industry, and in the past four years has garnered much experience in car imports in Croatia, where it holds the franchise for Ford imports.
As such, it is possible that Israel will soon witness the entry of Nochi Dankner's conglomerate into a project which will eventually compete with Project Better Place and the Ofer brothers, in the electric car infrastructure in Israel - and abroad, as well. It may or may not display the same Israeli-Sino cooperation model that the Ofers have with Chinese vehicle manufacturer Chery Automobile. It is also still not known if at some point there will be some form of collaboration on the infrastructure.
What is clear, is that a field which has yet to get off the ground is already the focus of different ventures, and if two different recharging infrastructures are put in place, it will certainly lead to consumer confusion. It is also clear that this is a field for giants, and that smaller firms will have a very hard time getting into it.
Published by Globes [online], Israel business news - www.globes-online.com - on August 24, 2008
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