26 Apr 20
News

China finetunes EV subsidies

The Chinese Government has been subsidizing the manufacturing and acquisition of electric and hydrogen powered vehicles since 2015 in order to ease the car buyers into cleaner technology and support local OEMs. The subsidies were due to be partially cancelled this year, as the EV ecosystem has reached maturity, but due to an economically slower 2019 and a disastrous first quarter in 2020, the Government has decided to free up some budget to continue EV support, be it in a revised scheme.

As from end of April 2020, only EVs costing less than 300,000 yuan (about $42K) will be eligible for subsidies that are 10% below the amount of previous support schemes. The Government will keep up the subsidies until 2020, but they will decrease another 10% each year.

The newly finetuned support scheme benefits Chinese manufactured EVs, rather than more expensive premium EU brands. Tesla, offering the Model 3 as from 324K yuan, will have to decide whether to lower its pricing to 300K and benefit from the subsidies, or miss out on the opportunity.

Picture Credit: Shutterstock

Authored by: Yves Helven