New energy car in China

CNC
Added On February 25, 2015

As heavy government promotion has brought more and more electric vehicles to China's roads, experts have cautioned against complacency and advised diversified efforts to make the electric vehicles more popular.
 
Though great headway has been made in the electrification of public transportation like buses and taxis, the electric vehicle industry shall look beyond these comfortable government-led fields and branch out for the wider private car users.
 
Chinese officials have voiced concerted efforts to continue strong policy supports to the development of electric vehicles. 
 
Meanwhile, industry insiders have forecast that China would overtake the United States and become the world's largest electric vehicles market in 2015.
 
STRONG SUPPORTIVE POLICIES TO CONTINUE
 
The electric vehicle promotion was bolted to the government work report delivered by Premier Li Keqiang last year as pollution control and emission reduction became all the more urgent against the backdrop of the smoggy Beijing winter sky. 
 
Since then, efforts have been intensified to ensure that more people can access these environmentally friendly cars. 
 
China's science and technology minister Wan Gang said in January that the country's electric vehicles market and industry both entered the period of new development opportunities. 
 
He said the Ministry of Science and Technology would continue to boost the fundamental research and key technology development for new energy vehicles (NEV).
 
Domestic electric vehicle makers have expanded their production capacity while the central and local governments devised more measures to push the sales and make buying electric vehicle a fashionable and worthwhile thing for the consumers.
 
SOUNDBITE(CHINESE): WU SONG, General Manager, GAC Motor
"I have confidence in the new energy vehicles. Our group had released new energy strategy a few year ago. And the new energy vehicle is the focus of the energy strategy development. From now on, the group will start a process of fully promoting the electric cars."
 
According to Ministry of Industry and Information Technology(MIIT), China has exempted roughly 42,800 buyers of NEVs from a 10 percent purchase tax since a new policy became effective last September.
 
From Sept. 1, 2014 to the end of 2017, buyers of qualified pure electric cars, plug-in hybrid electric cars and fuel cell cars will not have to pay the vehicle purchase tax. 
 
SOUNDBITE(CHINESE): YI ZEMIN,  Asst. PR Manager of BYD Auto
"The purchase tax exemption policies in Shenzhen are basically the same with that in Shanghai. Such as this model, it enjoys 30,000 yuan subsidies from the central government. The Shanghai local government, or Shenzhen local government will provide buyers another 30,000 yuan. So buyers could save 60,000 yuan, plus the 10,000 yuan tax exemption, customers could save 70,000 all together." 
 
Besides, the MIIT would formulate new measures that calculate the average fuel consumption of automobiles produced by each automaker to give preferential treatment to electric vehicle production. 
 
The new measures will allow automakers to trade credits that are based on their average fuel consumption and force the enterprises that fail to reach the standard to buy credits or receive punishment. 
 
FAST EXPANSION BOTTLENECKED
 
Statistics show China's electric vehicle output reached 78,499 units in 2014, up 3.5 fold year on year. Meanwhile, the electric vehicle sale was 74,763 units, growing 3.2 fold year on year. 
 
Thanks to the purchase tax exemption policy issued in September, the average output and sales kept growing at faster paces in the fourth quarter.
 
There are 377 NEV models from 57 automakers have entered the catalogue for purchase tax exemption. 
 
Among these models, some star products, such as BYD's Qin and JAC's Heyue IEV, have some performance index reach the international advanced level. 
 
SOUNDBITE(CHINESE): YI ZEMIN,  Asst. PR Manager of BYD Auto
"The total sales of BYD's Qin model is about 12,000 in 2014. It's the first domestic model that sales break 10,000. It's our sale champion model. In 2015, we will enlarge the promotion of electric vehicles. We will launch several new models, such as the Song and Yuan."
 
However, industry insiders said China's new energy vehicle developments are still facing challenges, such as the battery production techniques, battery manufacturing equipment and product consistency.
 
The insufficient battery production capacity may become the bottleneck that hampers China's electric vehicle development in 2015. 
 
A MIIT survey shows that China's power battery enterprises had a total production capacity of 13 billion kwh, which can satisfy the demands of 500,000 pure electric passenger vehicle. 
 
However, the demands for power batteries produced by leading enterprises are still exceeding supplies.
 
Meanwhile, China has not completed the construction of NEV charging facilities, which casts great negative influence on the popularization and application of electric vehicles. 
 
Last year, two families in China's Hefei City pioneered individual using service for electric vehicles. But after a month, only one of the new car owners applied the service again.
 
The owner Jiang Kai had been an electric car owner since 2012 considering the use cost and environmental protection.
 
SOUNDBITE(CHINESE): JIANG KAI, Car Owner
"High oil price is the first reason; besides, some friends of mine are engaged in related work which allowed me to have a pioneering try of the car."
 
Jiang Kai says he charged his car by a socket before. 
 
Since the year of 2012 when there was an introduction of step tariff policy, the more electricity quantity would lead to higher electricity price and that increased his using cost of the car.
 
SOUNDBITE(CHINESE): JIANG KAI, Car Owner
"Our electricity price could easily reach the third step tariff. (Reporter: How much was that probably?) If the electricity quantity brought the price to the third step, I would pay another 0.8 yuan per kilowatt. (Reporter: How would that be if there is no breakthrough and just maintain the present situation?) Now it charges by using charging piles 0.6 yuan plus per kilowatt at the peak time and 0.3 yuan plus at the low time. "
 
In order to further promote the new energy vehicles, Hefei power supply department began to accept application of individual using for electric vehicle charging from the beginning of last October.
 
SOUNDBITE(CHINESE): BU YUN, Staff of Hefei Power Supply Company
"There has been only one new user after the two, so this service is actually having only three users. For individuals, it is first necessary to have a parking space with private property, and the consent of property and relative charging equipment are also needed. The charging equipment installing service can be applied at any service hall."
 
The staff said incomplete hardware facilities and traditional concept of consumption have become important reasons that restrict the promotion of electric cars.
 
To solve the problem, the MIIT and the Ministry of Housing and Urban-Rural Development have reached an agreement that all new neighborhoods and buildings shall give priority to the construction of charging pile power sources.