China cracks down on low-quality EV manufacturers
The Chinese Ministry of Finance has announced higher technology tresholds for manufacturers of battery-electric vehicles, plug-in hybrids and fuel-cell cars. All have to comply with tougher standards on energy consumption and range if they want to continue receiving subsidies for EV production.
Additionally, the subsidies for battery-electric vehicles and plug-in hybrids have declined by 20% from the start of this year. Local government subsidies for EV manufacture have also been capped. The aim of these moves is to eliminate companies that are able to claim subsidies without producing quality electric vehicles.
China currently counts more than 200 EV manufacturers. Many were attracted to go into the EV business by the generous subsidies for the sector. The result of this goldrush mentality is a sector in which many manufacturers have serious shortcomings.
Stricter subsidy rules will help to make the sector more performant – and will also help to eliminate some of the overcapacity facing the industry, which is nevertheless progressing strongly. Last year, China overtook the US as the world's biggest EV market.
Image: Anna Frodesiak, CC0
| 10/01/2017 | Frank Jacobs