China sets 2019 deadline for automakers to meet green-car sales targets
BEIJING: China has set a deadline of 2019 to impose tough new sales targets for electric plug-in and hybrids vehicles, slightly relaxing an earlier plan to launch the rules from next year that had left global automakers worried about being able to comply.
Car makers will need to amass credits for so-called new-energy vehicles (NEVS) equivalent to 10 per cent of annual sales by 2019, China’s industry ministry said in a statement on Thursday. That level would rise to 12 per cent for 2020.
A single vehicle can generate multiple credits meaning the proportion by NEVS by volume would likely be lower.
The targets, announced by the Ministry of Industry and Information Technology (MIIT), closely mirror previously announced plans, but remove an explicit 8 per cent quota for 2018, in effect giving carmakers an extra year grace period.
The quotas are a key part of a drive by China, the world’s largest auto market, to develop its own NEV market, with a long-term aim to ban the production and sale of cars that use traditional fuels announced earlier this month.
Global automotive manufacturers, however, had urged a softening of the proposals for all-electric battery vehicles and electric plug-in hybrids.
Under the rules, carmakers will receive credits for new-energy vehicles including plug-in hybrids and fully electric cars that can be transferred or traded. Firms with annual sales volumes above 30,000 units will need to comply with the targets.
These credits - which will vary depending on the range and performance of the vehicle - will be used to calculate if firms have met their quota, a system which would likely mean the actual proportion NEVS made up of total sales was lower.
OPINION OF EXPERTS
“The rules could result in the production of more than one million EVS annually in China by 2020, or about 4 per cent of sales,” Simon Mui, a transport and energy exert at the Us-based Natural Resources Defense Council wrote in note. Carmakers were in general positive about the move.
“We welcome the Chinese auto industry’s shift towards greater adoption of NEVS and will comply with relevant regulations presented by authorities,” Ford Motor Co said in a statement responding to the announcement.
General Motors Co said it would “strive to comply with the NEV mandatory requirements”, though it added “continued joint efforts by the government and companies are essential to build broad-based consumer acceptance for NEVS”.
“GM has sufficient capacity to manufacture NEVS in China,” it said in a statement. Japan’s Honda Motor said it planned to launch an electric battery car in China next year and would “try to expand our lineup of new energy vehicles” to meet the quotas.
China is keen to combat air pollution and close a competitive gap between its newer domestic automakers and global rivals. It wants to set goals for electric and plug-in hybrid cars to make up at least a fifth of Chinese auto sales by 2025.
Reuters reported in August that China would delay the implementation of the NEV quotas until 2019, giving global automakers more time to prepare.
Meanwhile, China stocks were firm on Friday, buoyed by hopes of further reforms to the mainland’s state-owned enterprises and by consumer firms as investors bet shoppers would spend big during the upcoming week-long National Day holiday.
The blue-chip CSI300 index rose 0.4 per cent, to 3,836.50, while the Shanghai Composite Index gained 0.3 per cent to 3,348.94 points.
For the month, the CSI300 gained also gained 0.4 per cent but it posted a solid 4.6 per cent rise for the quarter, taking its gain so far this year to around 16 per cent. Much of the gains have come from resources stocks thanks to the country’s year-long construction boom.