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China Speeds Up Plan to Cut Subsidies for EVs
China's finance ministry said earlier today it will accelerate the phase-down of government incentives being used to spur sales of electric and hybrid cars.
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China's finance ministry said earlier today it will accelerate the phase-down of government incentives being used to spur sales of electric and hybrid cars.
The country currently pays subsidies as great as 35,000 yuan ($5,600) on a hybrid vehicle and 60,000 yuan ($9,700) for an EV. In December the government said it would reduce such funding 10% from 2016 to 2017, then trim incentives by another 10% in 2019.
The country previously targeted cumulative sales of new-energy vehicles at 500,000 units by this year and 5 million by 2020. But government data indicated that actual volume at the end of last year was only about 75,000 vehicles.
Beijing's new plan will maintain 2016-level subsidies through 2019, then slash them 40% beginning in 2020, Bloomberg News reports. One analyst says the new strategy is designed to pressure carmakers to accelerate EV development and cut prices enough to sustain sales growth without government aid.
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