China’s state planner said on Friday that restrictions on purchases of new energy vehicles (NEVs) will be gradually removed in various parts of the country in a “vigorous” push to promote “green consumption”.
Construction of supporting infrastructure to charge and replace batteries, store energy, and refuel hydrogen cells will also be strengthened, the National Development and Reform Commission (NDRC) said in a document.
A number of large Chinese cities such as Beijing, Guangzhou and Tianjin impose licence plate quotas to limit the number of new vehicles on roads and congestion, which also apply to NEVs.
China has in recent years heavily promoted NEVs as part of its efforts to curb air pollution and has seen adoption surge.
NEV sales volume rose by 124% year-on-year to 505,000 units in December 2021, accounting for 22% of entire passenger vehicle market.
“NEV sales volume accounted for 15% of passenger vehicle sales in the year to date, which suggests consumer acceptance is growing,” Kelvin Lau, analyst at Daiwa Securities in Hong Kong, noted.
Lau said Tesla posted “robust” sales of 71,000 units, including 245 unit exports of Model 3 and Model Y, while BYD sold 93,000 units, “continuing its solid momentum” and SAIC-GM-Wuling recorded sales volume of 60,000 units.
The country will, however, cut NEV subsidies by 30% in 2022 and withdraw them altogether from next year, arguing that the market has matured enough in terms of demand to grow without the aid of government help.
- Reuters, with additional editing by George Russell