China will cut off subsidies for new energy vehicles (NEV) – including electric cars – by the end of 2022, the country’s Finance Ministry announced on Friday
The ministry had said in April 2020 that subsidies for NEVs would be cut from 2020 to 2022 by 10%, 20% and 30% respectively. For public transport NEVs, subsidies would be cut by 10% in 2021 and 20% in 2022.
China, the world’s biggest auto market, has set a target for NEVs, including plug-in hybrids and hydrogen fuel cell vehicles to make up 20% of auto sales by 2025.
Global automakers such as Volkswagen, General Motors, Toyota and Tesla are ramping up electric vehicle production in China. The Ministry also said China would tighten up supervision of NEV safety issues to prevent accidents.
Industry body China Association of Automobile Manufacturers estimated earlier this month that sales of NEVs in China would grow by 47% to 5 million this year.
- Reuters with additional editing by Sean O’Meara