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NEV industry grows rapidly

Source: China Industry News | Date: Dec. 7

  • Recent data suggests that China is expected to produce more than 300,000 new-energy vehicles (NEVs) this year, becoming the world's largest NEV consumer in addition to the world's largest market of traditional petrol cars. Data shows that cumulative NEV output in the first ten months of this year stood at 206,900 units, representing a surge of 300% from the same period last year. Sales of battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) grew explosively during the period.

  • This suggests that beginning in 2016, China's NEV industry will move into a fast lane. In recent years, the Chinese government has been boosting the NEV industry through a slew of master plans and incentives. Especially, the government has invested heavily in using NEVs as a public transport vehicle in a bid to promote NEVs. The government is doing its best to expand the share of NEVs in the automobile market. In all cities that have done a good job in NEV promotion, there is one thing in common - local governments have given their big support to NEVs, and all the policies that they have implemented are widely accepted by the public.

  • For example, Shanghai has a highly open NEV market, where it has registered 64 types of NEVs from 33 Chinese companies, and the number of NEVs coming from other provinces and cities has exceeded 24,000 units, accounting for more than 71% of the city's total NEVs available for sale. In addition, the city has no limit in terms of building charging stations, paving the way for investors from all walks of life to get into the field.

  • According to one industry analyst, there are five problems that are impeding the promotion of NEVs. First, the promotion pace in cities is imbalanced, with a few cities progressing very slowly in this area. Second, infrastructure construction lags far behind expectations, with extremely low rate of power utilization on PHEVs and difficulty in getting cars charged. Third, many cities have invested little in research and development (R&D), a problem that has led to imbalanced NEV performance and a failure to meet market demand. Fourth, the country's power cell industry is lagging behind, with scattered R&D resources and a lack of globally competitive companies or conglomerates. Finally, there exists a problem of regional protectionism, which has hampered the NEV promotion and the NEV industry's healthy development.

  • In order to solve these problems, the Chinese government will continue to streamline its administrative procedures and further open the NEV market to all parties. What's more, the government will gradually pull out of its subsidies while offering non-tax, non-financial incentives, including unlimited road access, to encourage automakers to develop NEVs that fit into the market.