China will further support the new energy vehicle industry – Xinhua

Visitors see a new energy vehicle at the 2022 World Production Convention in Hefei, East China’s Anhui Province, on September 21, 2022. (Xinhua / Zhou Mu)

BEIJING, Oct. 4 (Xinhua) – China has renewed its political support for the new energy vehicle (NEV) sector. According to experts, this step will further advance an industry that is already in the fast lane.

A few days before the national holiday, which is usually considered the peak shopping season, China announced an extension of the tax exemption on NEV purchases until the end of 2023. This is the third extension since the measure is was introduced in 2014.

Based on the selling prices of the major new energy vehicles on the market, experts estimate that the program will save car buyers around 10,000 yuan (around US $ 1,408). Politicians expect 100 billion yuan in nationwide tax exemptions.

Tax exemption has proved to be an effective tool for stimulating consumption. In the first seven months of the year, about 40.68 billion yuan in taxes were remitted through this measure, an increase of 108.5% year-on-year, the state tax administration said.

According to experts, such a favorable policy will further increase the market demand for new energy vehicles. The sector has experienced rapid growth in recent years.

A total of 3.86 million NEVs were sold in China in the first eight months of this year, up 110% year-on-year, according to the China Association of Automobile Manufacturers (CAAM).

Globally, China has led the way in manufacturing and selling new energy vehicles for seven consecutive years since 2015, said Xin Guobin, deputy minister of industry and information technology.

The boom in China’s NEV industry came as the world’s second largest economy introduced a series of policy stimuli to spur the development of new energy vehicles.

China sees new energy vehicles as a priority in transforming its auto industry and has established a policy framework that provides a solid foundation for their development, said Meng Wei, spokesperson for the National Development and Reform Commission (NDRC).

One element of the plan is the development guideline for the NEV sector, which was presented in 2020. It outlines five main tasks for the development of the NEV industry from 2021 to 2035, including improving the capacity for technological innovation, building ecosystems for new industries and infrastructure improvements.

In addition, central and local governments have adopted more than 600 support measures in the areas of technological innovation, promotion and enforcement and security.

The continued political stimulus has helped the NEV industry make progress in areas such as technology development and market growth, said Shi Jianhua, CAAM’s deputy secretary general.

So far, China has built a complete industrial system, with advances in core technologies like batteries, motors and controllers, according to Shi.

Data shows that NEV sales in China stood at 11.08 million units at the end of May. At the end of 2012, there were only 20,000 units.

Meng believes that the Chinese new energy vehicle market still has great growth potential. The country is currently experiencing a modernization of consumer behavior with a generation of young consumers more open to new technologies and products.

Further measures are in preparation. According to Meng, China will continue to improve its new energy vehicle promotion system, optimize industrial layout, promote technological innovation and deepen international cooperation in the industry.

(according to Xinhua News Agency)

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