Beijing is pumping new hopes into China’s recently troubled new energy vehicle (NEV) market by raising the nationwide NEV sales target to 25%.
This includes electric vehicles (EVs), cars powered by renewable energy such as hydrogen fuel, as well as electric hybrids, according to a draft proposal released Tuesday by the Ministry of Industry and Information Technology (MIIT).
The proposal, running 2021 through 2035, comes at a time when the country’s burgeoning EV market—arguably the world’s largest—has been driving into the slow lane with declined sales over the past few months after Beijing starting to phase out its subsidy scheme for the EV sector.
Last year, NEV sales in China hit 1.25 million, accounting for a mere 4.5% of total vehicle sales in the country per a report by Evergrande Research Institute. Beijing’s ambition to leapfrog the sales from 2018’s 4.5% to 25% in 2025 brings opportunities and poses challenges for the local EV sector at the same time.
And to fulfill its ambitious plan, China is both counting on technology innovation and tapping help from the public and the ride-hailing sector.
The draft plan requires new cars running in public areas in key regions fighting air pollution should be NEVs starting from 2021. Many Chinese cities including Shenzhen, Wuhan, Zhengzhou, and Kunming have already implemented similar policies this year asking all newly-registered cars for online ride-hailing services to be fully electric.
China will also continue to boost technological innovation and breakthroughs in EV batteries and in-car operating systems, and improve infrastructure development in hydrogen fuel and driverless vehicles, the draft plan said.