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Recently, the manufacturers of alternative energy vehicle shared their sale performance in 2015. According to China Passenger Cars Association (CPCA), BYD, Zotye Auto, Geely Auto and BAIC Motor ranked top 4 in the list 2015 sale volumes of alternative energy passenger cars. The vehicle types like Kandi-Panda, BAIC Motor-E Series, Zotye Auto-Cloud, Geely Auto-Know beans also had great performance. However, the main manufacturers of alternative energy vehicles were not satisfied with the list.
2015
Top 10 vehicle manufacturers in sale volumes of alternative energy passenger
cars
Source: CPCA
Except
for BYD, the cheap and small electric vehicles occupied the top. In fact most
of the vehicles are just simply revamped by adding the 3-eletronic system (battery, electrical machinery and electronic control) based on the
A0 grade cars. That’s to say, the vehicles are 3-low products with low cost of
development, low technology and low price, which has squeezed the development
of the new alternative energy vehicles with high cost and high technology.
The
cheap and small electric vehicles have become the winners in the China
alternative energy vehicles market in 2015. They have occupied 66% in the total
sale volumes of 130,000 of domestic battery electric vehicles.
Among
the Top10 vehicles, the vehicle types of BAIC Motor, JAC, SAIC and BYD enjoy the
highest speed at 120-130 kilometers, according to their official websites,
while the hot-selling cheap and small vehicles only have the highest speed at
about 80 kilometers.
Though
the driving ranges claimed by the cheap and small electric vehicles are over
200 kilometers, in reality, it is difficult for them to reach the driving
ranges what they claim due to the decline of the battery.
Excessive subsidies
from the Chinese government
In
fact, there were many controversies in the market when these small electric
vehicles were launched. The qualities of this type of small electric vehicles
are considered close to the qualities of low-speed electric vehicles.
It
is stated clearly by the Chinese government that: “Till 2015, the highest speed
of the pure electric passenger vehicles and plug-in hybrid electric passenger
vehicles should not lower than 100 km/h”, according to the Development Plan on
Energy Saving and Alternative Energy Vehicle Industry (2012-2020).
However,
in the subsidy system, the pure electric passenger vehicles can still get the
subsidies with the highest speed at 80 km/h. The small electric vehicles can
also receive the 1:1 subsidy from the Chinese government and the local
government, with the amount up to about USD9,692 per car.
“It
is exactly the 1:1 subsidy policy that why the small electric vehicles occupied
the top of the list” stated Stanley Wang, Editor of China
Li-ion Battery News.
In
fact, the 1:1 subsidy policy means that the local government should give the
subsidies to the each electric car manufactured as the same amount as Chinese
government gives to the manufacturers.
“The
subsidy from the local government is a little bit too much, especially for the
small electric vehicles. The subsidy from the Chinese government is already
enough to make up the cost difference between the traditional vehicles and
electric vehicles” said Stanley.
The
subsidy from the Chinese government is calculated according to the battery
cost, thus it won’t be too much to all types of vehicles. But with more
subsidies from the local government, there is no cost or even negative cost for
manufacturing a small electric vehicle.
When
looking at the alternative energy vehicle policies in Europe, USA and Japan,
their subsidies are mainly used in supporting the enterprises to develop and
construct public charging piles. As for personal users, the governments will
give priority to them in using the roads and parking spots, also, the
governments will cut down a bit of taxes on personal users.
Again
back in China, the supporting policies for alternative energy vehicle include
subsidies, reduction on taxation and no charge of the license fees, which is
much too “encouraging”.
The Chinese
government is weakening the subsidy policies
Fortunately,
the Chinese government has realized the problem and decided to stop being such
“encouraging”.
Actually,
the Chinese government began to adjust its policies, according to analysts CCM.
The
subsidy policy for alternative energy vehicle for 2016-2020 published in Apr.
2015 showed 2 big directions clearly.
Firstly,
the government has increased the entry of subsidy: battery electric passenger
vehicles should reach the highest speed of 100km/h with the driving ranges over
100km, which has excluded many small battery electric vehicles with
low-speech.
Secondly,
the government has decreased the amount of subsidy. Compared to the high
subsidy in 2015, the subsidy in 2016 has decreased a lot. The government will
lower 20% of the subsidy every 2 years. That is to say. In 2017 and 2018, the
subsidy will be 20% lower than that in 2016; in 2019 and 2020, it will be 40%
lower than that in 2016.
The
latest policy – Incentive Policy for
Alternative Energy Vehicle Charging Infrastructure during the 13th Five-year
Plan (2016-2020) - published by the Chinese government in Dec. 16 2015
again shows another 2 directions in developing the alternative energy vehicles.
Firstly,
the government will increase the subsidy for charging infrastructures. In the
past, the encouraging policies were all revolved around the manufacturers and
vehicles. The
latest policy gave priority to the charging infrastructures and clearly
stated that there would be incentive standards for constructing charging
infrastructures.
Secondly,
the Chinese government will clear up the regional protectionism. The latest
policy targets the nationwide. In the past, it mainly focused on
Beijing-Tianjin-Hebei Region, Yangtze River Delta and Pearl River Delta.
Now,
the Chinese government has made different goals for the air-polluted areas,
the central areas and other areas. The areas which promote alternative energy
vehicle better will be rewarded accordingly.
Take
the air-polluted areas as an example, in 2016, the goal for the area is to
promote 30,000 alternative energy vehicles. If it can achieve the goal, the
Chinese government will offer a monetary reward about USD13.84 million for
constructing the charging infrastructures.
“It
is very clear that the Chinese government will stop being so general in the
subsidy policies in the alternative energy market” said Stanley.
“It
is believed that the Chinese government will be stricter in the inspection of
the vehicles in next round of promotion”
“The
goal setting is actually putting pressure on different local government” he
added.
If you need more
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