Discrepancies in subsidy payments may be behind surging demand for electric cars.
Chinese electric taxi? Image: Commons |
As pollution continues to stifle China's rapidly developing cities, the appeal of electric cars has never been greater. Smog, coupled with generous subsidies for new energy vehicles, has led to a rapid increase in NEV adoption over the last few years.
However, a recent report from China Central Television (CCTV) has cast doubt on whether the subsidies are being used for the purposes they are intended, creating an inaccurate picture of the nation's NEV market.
The report focused on a little-known producer of electric cars and buses that had claimed subsidies on sales of some 3,000 units. CCTV claimed the company had reported sales of its units without even producing the cars themselves, instead simply using the licence plates to gain the subsidies. The company denies the accusations.
Subsidies for energy-efficient commercial vehicles are generous. Combined subsidies for larger, bus-type units can often reach as much as 1m yuan ($156,000 compared to 100,000 yuan for passenger cars. Since 2009, central and local governments have spent around 15 bn yuan ($2.3bn) on subsidising NEVs.
While the report may call into question the double-digit demand for NEVs, Elon Musk, the founder of Tesla, remains bullish on the Chinese market. BYD also expect sales of its EVs and hybrids will reach 150,000 units this year.