cens logo

Sales of New Energy Cars Surge in China Driven by Official Incentives

Positive results evident especially in Shanghai

Aug 15, 2014 | By Michelle Hsu


Despite consumers' concern over high cost, technological bottlenecks, inconvenience of recharging, among other problems of new energy cars, new energy vehicles have found a promising market in China where, according to official statistics, production and sales of new energy cars surged 2.3 and 2.2 times, respectively, during the first half (H1) of 2014 from a year earlier.

Sales of new energy vehicles, considered eco-friendly relative to  conventional cars, have surged in China this year. Sales of new energy vehicles, considered eco-friendly relative to conventional cars, have surged in China this year.

Both figures exceed those of 2013 and are expected to continue growing at accelerated pace during H2, 2014. Surging sales of new energy cars are expected to help sales of all suppliers of auto parts, and developments of charging point and facilities builders.

According to a survey conducted by the University of California, China is the world's 3rd largest new energy vehicle market in 2013, only trailing the U.S. and Germany. The accelerated growth of China's new energy vehicle market this year may further push China into the lead soon, with  new energy vehicle sales in China likely to exceed units 50,000  in 2014, about triple that of last year.

Eco-protection is generally seen as the reason driving consumers to buy energy-saving vehicle, with the recent slowdown in economic growth of China helping to drive sales of such vehicles as the Beijing government has selected new energy vehicles, along with other energy-saving industries, as targeted, emerging industries to promote to bolster China's industrial development and economic growth. China's premier Li Keqiang said that new energy vehicle is a strategic industry of China for industrial upgrading and environment protection.

China's sales of new energy vehicles surge this year. China's sales of new energy vehicles surge this year.

To encourage procurement of new energy cars, China's government has taken the lead to promote usage of such cars. The “New Energy Vehicles for Government Agencies and Public Institutions Purchase Scheme” jointly announced by the National Government Offices Administration, the Ministries of Finance, Science and Technology, Industry and Information Technology, and the National Development and Reform Commission, for example, clearly sets the timetable and roadmap for government agencies and state institutes to convert to new energy cars, with at least 30% of those in central government fleets, government agencies and state bodies in the new energy vehicle promotion cities for the 2014-16 period required to be new-energy vehicles, after which the program will be extended yearly.

The program also allows for certain percentages of new energy vehicles to be purchased for governmental agencies and state bodies of various provinces and cities during these several years.

Where micro-particle pollutant control is challenging, as in  Beijing-Tianjin-Hebei area, the Yangtze River Delta, and the Pearl River Delta, the proportion of new energy vehicles purchased by government and state bodies must not be less than 15% in 2014.

As to the infrastructure facilities and equipment for new energy vehicles which have become a matter for public concern, the program also clearly stipulates: the ratio of charging interfaces to new-energy vehicles should be not less than 1:1. The five central government ministries which jointly announced this program are required to make their policies favorable to investments in this regard, and the governmental guiding principles aim to spark enthusiasm of all sectors of society, improve key infrastructural construction for new energy vehicles, and meet recharging demands.

Specific Measures
As to how these target requirements will be implemented, the program's implementation involves 14 specific measures, including subsidies for governmental agencies and state bodies so that the final price of a new energy vehicle, minus governmental subsidy, must not exceed 180,000 yuan; local governments must classify new energy vehicle charging facilities as public infrastructure to include such in overall urban development planning; and for formulating and implementing restrictions on the quota for the motor vehicle license plate lottery, car quota systems, and road traffic priority regimes, local governments must apply appropriate concessionary policies towards new energy vehicles.

According to reports, the program also allows complete, quantified assessment feedback supervision, proposing that from 2015, energy management departments in state agencies of provincial districts or cities must, according to annual statistical summaries of the previous year, submit reports to the National Government Offices Administration of new energy vehicle equipment status, mileage, energy consumption, cost etc. At the same time, the program requires slow progress and failure to meet purchase proportion requirements to be reported; rectification orders to be issued for fraud, with culpable leaders to be held responsible.

To further encourage investments in infrastructure and equipment for new energy vehicles, the National Development and Reform Commission announced the “Electricity Pricing Guidelines for Electric Vehicles” on July 30, offering preferential rates for EV-charging stations and related facilities, in addition to the exemption of basic electricity fee by 2020.

Meanwhile, the Beijing government will  subsidize construction of charging stations and related facilities, to reduce costs of operators so as to transfer such benefits to consumers.

Another substantial incentive that the Beijing government announced earlier is to waive  purchase tax on new energy vehicles, allowing a new energy car buyer to save 17,000 yuan on the purchase of a car priced at 200,000 yuan.

Battery is the critical technology for new energy vehicle industry.Battery is the critical technology for new energy vehicle industry.

Shanghai as Model  Preliminary results of the government's new energy vehicle promotion policies are evident in almost all major cities around China, with Shanghai considered a model city where the city government fully supports the central government in new energy car promotion. The cumulative sales volume of new energy cars in Shanghai has exceeded 1,000 vehicles during the first six months, nearly double the 581 in 2013.

The Shanghai government released the “Implementation Plan on Promoting Usage of New Energy Vehicles in Shanghai City (2013-2015)” as guidelines to regulate the situation where the number of new energy cars grows at  an accelerated pace, targeting the promotion of  new energy vehicles, infrastructure, and so forth. At a news release conference, Shanghai City revealed that the latter part of the policy, covering charging point construction and new energy cars convenient access, will soon be introduced.
“Preliminary results of new energy vehicle promotion in Shanghai City are evident,” said Ma Jing, deputy director of Shanghai Municipal Commission of Information and Informatization, also citing statistics that Shanghai's cumulative new energy vehicle sales in the first six months have exceeded 1,000 vehicles, and the number is set to grow.

As for infrastructural construction, such as charging points, Shanghai has set up a joint commission to promote construction of public charging points, accelerating promotion of  public charging network construction. Shanghai Electric Power Company has built 177 charging points at governmental agencies, enterprises, schools, residential areas, and in public parking lots. Some firms in the Hongqiao transportation hub have built more than 100 public charging points.

China offers incentives to encourage restriction of power-recharging points. 
China offers incentives to encourage restriction of power-recharging points.

The surging sales in 2014, however, were only considered the beginning of the new energy vehicle market boom in China, to have motivated the city government to further promote the program in the following years. The “Implementation Plan,” for example, shows that by 2015, Shanghai will promote the use of 13,000 new energy vehicles. Of these, foreign brand vehicles will account for no less than 30%, and new energy vehicles no less than 30% of new or upgraded public transport, service, sanitation, and logistics vehicles.

Shanghai Municipal Commission of Economy and Informatization and other sources have disclosed that Shanghai will introduce policies to promote new energy vehicles, and some districts of Shanghai City will also support the introduction of appropriate policies.

The city government's plan targets approximately 4,000 new energy vehicles to be in use 2013 to 2014, and about 9,000 by 2015. As of the first half of this year, Shanghai City's promotion of new energy vehicles has approached 2,000, only half of the  target.

Shanghai has also proposed to further improve infrastructure to fully realize networking and ease of use. By 2015, Shanghai will have built around 6,000 or so charging points of various types, and one hydrogen refueling station. Of these, 300 AC/ DC charging points were constructed in 2013, 1,500 will be built in 2014, and 4,200 will be built in 2015, along with one hydrogen refueling station.

As for the policy of waiving purchase taxes on  new energy vehicles proposed by the State Council, Shanghai city officials said it will be put into effect after implementation bylaws are promulgated. In addition, the State Council requested that relevant departments pay close attention to the formulation and announcement of new energy vehicle catalogs.

Shanghai Municipal Commission of Economy and Informatization said that Shanghai's model catalog will be consistent with state level catalogs, and is expected to offer local brands and imported new energy vehicles.

Industry Reports

K, the leading global plastic and rubber trade fair (Photo courtesy of Messe Düsseldorf/ctillmann)

K, The World's Leading Trade Fair for Plastic and Rubber Industry

Jul 24, 2020

2019 K Show, the leading global trade fair for the plastics and rubber industry, had been held in Düsseldorf on 16-23 October, 2019. There were 3,330 exhibitors from 63 nations proved impressively: plastics continue to be an innovative, indispensable material. But they also unanimously underscored the necessity of having operational circular economies along the complete material chain and to this...

Photo courtesy of CENS

Digital Healthcare & Technology at the Heart of Las Vegas CES 2020

Jul 14, 2020

■ Hubert Chih The number of healthcare exhibitors at the 2020 CES in Las Vegas increased significantly by 23% from 2019. According to the analysis and report by the CES organizer, digital healthcare and technology were the focus in the healthcare exhibition. In addition to the continued expansion of healthcare coverage, the reduction of healthcare costs, the improvement of effectiveness and th...

The Taiwan Hardware Show sees global buyer attendance. (Photo provided by Kaigo Co.)

Taiwan's Hand Tools Seeking Opportunities Amid Global Crisis

Jul 10, 2020

Due to the COVID-19 pandemic sweeping the globe, most of the international hardware shows slated for this year has been moved to 2021. However, as Taiwan’s efforts combating the new virus has proven to be successful, the 2020 Taiwan Hardware Show (THS) will continue as scheduled, beginning on Oct. 13 and ending on the 15th at the Taichung International Exhibition Center, thus becoming the only sh...

Industry In-Focus

SINOSTEEL Corporation: Rising price in Steel</h2>

SINOSTEEL Corporation: Rising price in Steel

Jun 05, 2020

Brazil’s new crown pneumonia epidemic has rapidly increased. Brazil’s Vale, the world’s largest iron ore producer, is facing an out-of-control impact. The market is worried that iron ore production and sales will be affected. new highs. Experts from Sinosteel (2002) evaluated that steel prices will rise steadily under the effect of rising costs, with a promising outlook. According to a legal p...

Apple Invests Millions in LED Plant in Taiwan</h2>

Apple Invests Millions in LED Plant in Taiwan

Jun 01, 2020

Apple is considering to invest over US$330 million in a factory in northern Taiwan to manufacture both LED and micro-LED displays for its iPhones, iPads, MacBooks, and other new devices. Apple is teaming up on the new factory with Epistar, Taiwan's top LED producer, and Taiwanese LCD panel maker, AU Optronics. The plant will be located in the Longtan branch of the Hsinchu Science Park and Appl...

Taiwan Machinery Was Applauded in COVID-19</h2>

Taiwan Machinery Was Applauded in COVID-19

May 18, 2020

What the epidemic showed was the amazing flexibility of Taiwan's machine tool industry. Taiwan, which has allowed the semiconductor industry to specialize in the past, has finally realized that these machine tool industries with amazing strength are the "invisible champions" of Taiwan's economy. In early February, three companies -- Habor Precision, Tongtai Machine & Tool and Taiwan Takisawa -...

Supplier News

With professional technics and rigorous quality control, Kung Hsing gains high-reputation in the industry</h2>

With professional technics and rigorous quality control, Kung Hsing gains high-reputation in the industry

Jul 23, 2020

Kung Hsing Plastic Machinery Co., LTD., founded in 1972, is the brainchild of the company President Tsai Chin-lien’s over 48 years of experience in designing and producing extrusion machines. The firm stood by its belief to uphold integrity and offer the best quality and services, eventually becoming a leader in the extrusion machinery industry in Taiwan. Kung Hsing currently has two factories; t...




Jul 21, 2020

■ Tseng Lung-nan Intype Enterprise has built up 55 years of experience in producing extruders, though the firm is placing greater consideration on rapidly degrading of the global environment. In the past 20 years, Intype has become an active contributor to building up a global ecosystem, enabling them to reuse the products manufactured by their own extruders and avoid further waste. The firm t...


YFCM Carbon Fiber Driveshaft Lauded in the field of Modified Cars for its Flexibility </h2>

YFCM Carbon Fiber Driveshaft Lauded in the field of Modified Cars for its Flexibility

Jul 14, 2020

■Hsiao Yung-le Yifeng Technology Co., Ltd. specializes in the research and development of carbon fiber transmission shafts and the manufacture of carbon fiber related products.The carbon fiber material has the characteristics of lightweight, impact resistance, fatigue resistance, and corrosion, and chemical stability is quite high. The product type is increasing in the extensive range with an ...


Insiders' Views

Caption: Pictured from front row, third right, Changhua County Government Economic Affairs Department Director Liu Yu-ping, County Magistrate Wang Huei-mei, Secretary Chen Bo-tsun pose in front of the exhibition booth. (Photo provided by CHCIA)

Changhua County Government Shores up Biz-Matching to Global Buyers

Nov 18, 2019

■Yang Feng-Chun In a bid to assist manufacturers in Changhua County to expand their market reach overseas against severe competition in the globalized market, Changhua County Government has been an active player in pushing for a makeover and innovation of its local small and medium-sized enterprises. This is done in hopes of establishing stronger connection with international markets. An ex...

Paul Master offers high-quality chassis and engines parts for passenger cars, trucks, and industrial trucks. (Photo courtesy of Paul Master)

Paul Master Builds Reputation with Auto Chassis and Engine Parts

Nov 18, 2019

Founded in 1980, Paul Master Auto Parts Co. is headquartered in Taiwan, a professional manufacturer of chassis and engines parts for passenger cars, trucks, and industrial trucks including forklifts. General Manager Terry Liang said the company has its own professional design department, which provides customized products and specifications for global buyers, including automobile steering and...


Nan Hoang Traffic Instrument Co., Ltd.</h2><p class='subtitle'>Taiwan First brakes Technology Co., Ltd. </p>

Nan Hoang Traffic Instrument Co., Ltd.

Taiwan First brakes Technology Co., Ltd.

Sep 04, 2019

Nan Hoang Traffic Instrument Co., Ltd is one of the major manufacturers of automobile friction materials in Taiwan and globally. Chairman Austin Cheng has implemented the double-arrow strategy this year - own brand of “YangPo” is adopted to focus on global channels while the “NHC brand focuses on improving market shares in global markets, such as Europe, America, Asia, Australia, and the Middle E...

Exhibition Highlights

Koelnmesse (Beijing) Co., Ltd.

Announcement on Postponement of China International Hardware Show 2020 (CIHS 2020)

Jul 10, 2020

In view of the continuous spreading of COVID-19 all over the world and the latest epidemic prevention requirements of China and the government of Shanghai, in order to guarantee the health and safety of exhibitors, purchasers and professional visitors, China National Hardware Association and Koelnmesse have prudently decided to postpone China International Hardware Show 2020 (CIHS 2020) from Augu...

Automechanika Shanghai 2020 creates channels for cross-sector collaboration</h2>

Automechanika Shanghai 2020 creates channels for cross-sector collaboration

Jun 16, 2020

This year, Automechanika Shanghai continues to serve the entire automotive value chain by offering opportunities for information exchange, marketing, trade and education. Both vertically and horizontally, from OE, vehicle production to the aftermarket, it incorporates all elements of manufacturing, supply networks, services, new business models and information technology. Companies across the...

Messe Frankfurt (Shanghai) Co Ltd

CAPAS defers to 2021

Apr 20, 2020

Following the Chinese Government’s initiatives to prevent and control the COVID-19 outbreak, the organisers of the Chengdu International Trade Fair for Automotive Parts and Aftermarket Services (CAPAS) have announced the defer of the show’s 2020 edition. The fair, originally scheduled from 21 to 23 May 2020, will now be held from 20 to 22 May 2021. In China, the State Council issued an announc...