ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Environment

China slashes eco-car subsidies 20% as sales rebound

New-energy-vehicle market expected to reach 1.8m units in 2021

An Infiniti electric concept car, the Qs Inspiration, at a shoot for a car advertisement in Shanghai.   © Reuters

BEIJING -- China is reducing subsidies for new-energy vehicles by 20% in 2021 following a solid recovery in sales, moving to pull back fiscal support designed for a pandemic-battered market.

The new policy for the program, covering electric cars, plug-in hybrids and fuel cell automobiles, took effect Friday. The subsidies are reduced by a smaller 10% for commercial vehicles including buses, taxis, ride-sharing vehicles and waste collection trucks.

Sales subsidies for standard electric vehicles with a travel range of 300 km to 400 km per charge decline to 13,000 yuan ($2,012) in 2021 from 16,200 yuan in 2020. Buyers of standard plug-in hybrids get 6,800 yuan instead of 8,500 yuan.

Beijing announced a two-year extension to the subsidy program last March after sales of new-energy vehicles recorded their first year-on-year drop in 2019, a slump deepened by the coronavirus. But sales apparently ended up exceeding year-earlier levels by nearly 10% in 2020, prompting the government to curb support and lighten its fiscal burden.

The China Association of Automobile Manufacturers estimates sales of new-energy vehicles at 1.3 million units for 2020 and forecasts that they will reach 1.8 million units in 2021.

New-energy vehicles made up about 5% of China's new-auto sales in 2020. The China Society of Automotive Engineers' road map puts forth targets of 20% in 2025 and 50% in 2035, when the other half are to be conventional hybrids.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more