In November 2009, China surpassed the United States as the world’s largest automotive market when sales of cars and sports utility vehicles exceeded the 1 million mark. This figure is expected to rise in the coming years.
Xiao Chengwei, a member of an expert panel in the Ministry of Science and Technology’s Alternative Fuel Vehicles Program, estimates that China will have 130 million cars by 2020 and over 300 million by 2030.
“Of this large number, public vehicles will number 90 million by 2020, and will surpass 267 million by 2030,” he projected.
The swift growth of China’s auto industry entails the increasing dependence on energy, prompting the government to offer subsidies and other financial incentives to encourage the use of E.V.’s, Mr. Xiao told participants at the second EV Li-Ion Battery Forum in Beijing last week.
China’s electric vehicle development plan
The increase in the volume of cars drove up China’s energy consumption, which led to the rise in car exhaust and carbon emissions. Statistics show that fuel use in the country increase by 12 percent annually and is expected to surpass 70 percent by 2015.
“Electric car development in China has followed a threefold path of vehicle and key component development, showcasing interconnectivity and mutual need of both sectors,” Mr. Xiao said.
The government provided financial support to three areas – natural gas-powered cars, hybrid cars and all-electric cars, as well as three component areas namely batteries, electric motors and charging technologies.
The promotion of electric buses and passenger cars will run concurrently with the development of private and high-end electric vehicles – the so-called “two ends meet” strategy.
China will also encourage higher fuel and energy efficiency for both traditional cars and hybrids, and push for the development of other advanced vehicle technologies.
One thousand electric cars
The government launched an electric vehicle initiative in 2009 that aims to put a thousand electric cars in 10 Chinese cities yearly. Through this project, the government intends to have 10 percent of all cars in China to be electric vehicles by 2012.
“Actually, we have launched this program in 20 cities,” said Mr. Xiao said. Out of these 20 cities, five will be selected for implementation of subsidies for private vehicles. These cities are Shanghai, Changchun, Shenzhen, Hangzhou and Hefei.
Vehicle types covered by the subsidies will include all-electric vehicles, plug-in hybrids and natural gas-powered vehicles. However, all-electric vehicles must have a battery function of 15 kilowatts per hour and above, while plug-in hybrids must have a minimum battery function of 10 kilowatts per hour to avail of the subsidies.
The main idea behind the battery function criterion is that for electric vehicles, every kilowatt would receive up to $439 in subsidies, while hybrids will receive up to $7,300. The subsidies are also directed at batteries guaranteed for up to five years and 100,000 kilometers. The subsidy period will be from 2010 to 2012.
Meanwhile, subsidies for public vehicles will range from $7,300 to $87,800.
