China to Rapidly Reform its Electric Vehicles Market

If the People’s Republic of China (PRC) continues to increase its sales of electric vehicles at the same rate as it does today, then in the short term it is set to become the absolute leader in the spread of this type of transport.

The benefits of electric vehicle ownership operating in the PRC in recent years have "spurred" the demand for an environmentally friendly mode of transport so that even after these privileges are "curtailed" it does not fall, but, on the contrary, continues to grow.

In September, approximately 2.7 million cars were sold worldwide, 78 thousand of which are those that use alternative energy technologies: hybrid engines and electric batteries. Compared with September 2016, this was a 79% increase in sales.

From January to September this year, Chinese citizens purchased 398 thousand electric vehicles, which implies an increase in sales of almost 40% y/y. Local manufacturers produced 424 thousand electric vehicles, and it turns out that if this amount is subtracted from exports, then virtually all electric vehicles are bought by the Chinese themselves. Moreover, the September demand for electric vehicles outperformed production.

In September, 77 thousand electric vehicles came off the assembly line, up from 55 thousand in August (+68% y/y). Thus, China again broke the record. The leader in sales is the BAIC EC-Series, followed by the city electric car Zhidou D2 EV, and in third is off-road car the BYD Song PHEV.

In order to combat the serious environmental threat of pollution, China has set a special quota for the share of electric vehicles: by 2019 they should make up at least 10% of total vehicles being driven in the country, and by 2020 at least 12%. According to the plans of the Chinese authorities, which were voiced earlier, local automakers will be able to supply about three million electric cars per year to the market annually by 2020, and by 2025, 7 million. And this is the fifth of the total production of cars in China. It was also reported that in 2018 China will be able to produce up to 1 million electric vehicles.

Dimitri Dolaberidze