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NEVs with range less than 150km unlikely to receive subsidies

Catherine From Gasgoo| December 15,2017

China NEV market, China NEV subsidy, China NEV sales

Shanghai (Gasgoo)- It seems deterministic that new energy vehicle (NEV) subsidy will phase out, but recently the rumor goes that in 2018, the subsidy will be reduced faster than originally planned and the rules may be modified. One of the changes may be that NEV with a range of no more than 150km shall never receive subsidies.

A person in charge of a local power battery company told the media, “The subsidy policy will have obvious changes and be more favorable to NEVs with high energy density. Only those NEVs with high energy density can be qualified to get subsidy. Since LFP battery cannot reach the target of high energy density, it is possible for the whole industry to shift to ternary batteries.”

If the above speculation turns out to be true, it will be a big blow for those small-size NEV producers. And also the change may speed the elimination of those which aims at subsidies and credits, but have little technology. All those consequences may reshape the business modes of NEV manufactures and battery providers.

An expert from the Chinese Automotive Technology Research Centre said that related departments are considering introducing supporting tax policies. For example, buyers of NEVs can receive a certain income tax deduction.

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