Ministry of Industry and Information Technology: The Cancellation of Energy-saving Automobile Subsidy Policy is Still Inconclusive

Regarding the rumors that the 3,000 yuan subsidy for energy-saving cars will be eliminated or will be cancelled in June this year, Zhang Xiangmu, director of the Ministry of Industry and Information Technology of the Ministry of Industry and Information Technology, told reporters after attending the World Automotive Industry Forum meeting that if the cancellation is still to be evaluated, it will be decided.

Recently, there are media aids that led the reform coordination committee’s industry coordinating department’s statement that the energy-saving vehicle subsidies will be canceled on June 1. Rumors have led to short-term booms in some city auto markets. In this regard, Zhang Xiangmu said that there is still no conclusion on whether this policy will be cancelled.

Zhang Xiangmu said that as new energy vehicles are still faced with technical and other difficulties, China will continue to promote the popularization of energy-saving vehicles and guide the consumption of low-emission vehicles with low emissions in the future. According to its introduction, the list of energy-saving vehicle subsidies has been issued in six batches, and more than 400 models have been selected. By the end of March, the country has subsidized more than 1.7 million energy-saving vehicles, and future support will be further increased.

In addition, the follow-up policies for the promotion of energy-saving vehicles also include encouraging enterprises to develop advanced energy-saving technologies for automobiles, formulating and promulgating three-stage passenger car fuel consumption limit standards and heavy-duty commercial vehicle fuel consumption limit standards, and formulating vehicle fuel consumption. The volume management approach rewards the realization of the target value of fuel consumption for automobiles.

"Heavy-duty commercial vehicle fuel consumption limit standard is expected to be completed within the year and released." Zhang Xiangmu said.

While promoting energy-saving and emission-reduction of traditional automobiles, China will also accelerate the cultivation of new energy automotive industry, cultivate a group of companies with well-known brands and core technologies, expand the scope of pilot subsidies for new energy vehicles, accelerate the construction of infrastructure such as charging stations, and establish Production access system.

Although car sales in April experienced the first year-on-year negative growth in 27 months, the industry experts are still very optimistic about the demand for cars in China. Zhang Xiangmu predicts that in the next decade, the demand for cars in China will continue to grow. By 2020, the number of cars will reach 200 million.

Xu Changming, director of the Resource Development Department of the National Information Center, also believes that before 2020, China's passenger car market will still be in a rapid development zone, with a growth rate equivalent to about 1.5 times GDP growth. Xu Changming believes that China’s autos have a saturation point of 450 million vehicles.

The prospects for the automotive market in the second and third-tier cities are even more promising. Xu Changming believes that by 2020, the share of third-tier cities in the national market will increase from 29.3% in 2009 to about 55%, the proportion of second-tier cities will decrease from 39.9% to 30%, and that of first-tier cities will decrease from 30.8% to 15%.