Auto leaders propose tax breaks, new energy incentives at two sessions

The annual sessions of the National People’s Congress and the Chinese People’s Political Consultative Conference are in progress, and executives of some carmakers have submitted their proposals. Here are some of the most popular ones.

Li Shufu, chairman of Geely Holding Group and NPC deputy

Li has proposed that vehicle purchase tax, which is currently collected by the central government, should be shared by both the central and local governments.

Li said the move would increase local fiscal and tax revenue as well as improve local government’s motivation in boosting car sales.

Purchase tax revenue totaled around 350 billion yuan ($49.05 billion) in 2019 and is estimated to reach 500 billion yuan in 2030.

Local governments can use the money to build roads, parking lots and electric vehicle charging poles, which will promote the industry’s development, he said.

Li also proposed a proportion of the money should be earmarked for helping carmakers develop new technologies and spent as subsidies for more families to become car owners. Li’s other proposals include removing the ban on motorcycles in cities.

Wang Fengying, president, Great Wall Motors and NPC deputy

Wang called for more efforts to promote the development of small-sized electric vehicles, which are cheaper but more environmentally friendly and require smaller parking spaces.

In the past several years, sales of smaller electric cars fell because of subsidies that prioritize larger vehicles with a longer range. Wang proposed the authorities should provide more incentives for the production of smaller vehicles and come up with detailed standards for their development. Wang also advocated for fuel cell vehicles, which are believed to be totally clean. She suggested the government should encourage investment in research and development of key materials and technologies and promote their localized production.

The government should also set up pilot programs for fuel cell vehicles and draft a national plan for the sector. Her other proposals include auto consumption, data integration and intelligent detection of vehicles.

Chen Hong, chairman of SAIC Motor Corp and NPC deputy

Chen proposed that local authorities should gradually ease restrictions on car purchasing and use in big cities, which are used as a measure to ease traffic congestion. Instead, Chen said local governments should improve their level of urban management, adding big data and AI can also be used to manage traffic flow.

Chen suggested that regions with optimum conditions for speeding up the development of intelligentconnected vehicles should do so.

He said regions such as the Yangtze River Delta region can build pilot zones for highly automated driving road testing, like those at Shanghai International Automobile City.

Chen also proposed accelerating the construction of new infrastructure such as 5G and broadband networks to support the development of intelligent-connected vehicles.

Xu Heyi, chairman of BAIC Group and CPPCC member

Xu proposed efforts should be made to make vehicles an integral part of smart infrastructure.

He suggested that tech companies and carmakers should join hands to build smarter cities.

In terms of new energy vehicles, he said the government should take the lead in establishing funds for the electric car battery industry, so that batteries’ lifelong value can be better coordinated.

China has been the largest market for new energy vehicles since 2015, but the driving range of electric vehicles, which is primarily determined by batteries, remains a major concern for customers.

Xu also called for more efforts to promote auto financing, which is widely used in developed countries, to further unleash the demand for cars.

Zeng Qinghong, chairman of GAC Group and NPC deputy

Zeng proposed efforts should be made to cut taxes for carmakers, as the automotive industry has been severely hit during the pandemic that is still raging in many countries.

He said the government should cut taxes for car buyers as well, a move that will help boost car sales. Car sales in China totaled 5.76 million in the first four months of 2020, down around one third from the same period last year.

His other suggestions to boost car sales include increasing car plate quotas in big cities, postponing the implementation of stricter emissions standards and further optimizing subsidy policies.

Zeng also proposed developing a new energy vehicle industry cluster in the Guangdong-Hong Kong-Macau Greater Bay Area, network security and measures to fight poverty.

Zhu Huarong, president of Changan Auto and NPC deputy

He proposed that the government, officials and celebrities should buy Chinese-branded vehicles to help boost the image of China-made cars.

He said Chinese brands have made great strides in improving car quality and after-sales service, and sometimes even outperform some international brands.

Chinese-branded vehicle sales totaled 532,000 in April, and their combined share slipped to 34.6 percent in the month, the lowest since July 2014.

His proposals also cover new energy vehicles. Zhu said people’s reluctance to choose such vehicles lie in poor value for money compared with gasoline cars and the lack of charging poles.

He suggested the authorities should review the new energy vehicle strategy and make sure such cars are easy to use, including cutting parking fees and charging fees for them.