Production of PHEVs and BEVs (NEVs) in China may surpass 1.5 million units in 2021
- In 2019, the production in China of passenger vehicles locally named as "New Energy Vehicles" (or New Energy Vehicles - NEVs, and which include PHEVs and BEVs) fell for the first time below the level of the previous year due to reduction of subsidies. In 2020, in the first semester, the production fell sharply, down 39% year-over-year due to the impact of the coronavirus. However, from July, the production exceeded the level of the previous year at the same time to end the year up 16% compared to 2020.
- The Chinese government launched a series of policies in 2020 to continue supporting the development of the NEV market. In April, the central government decided to extend until 2022 the subsidy policy for NEVs (which was initially due to be stopped in 2020) in order to offset the effects of the coronavirus. In June, a revised version of the CAFC (Corporate Average Fuel Consumption) and NEV credit policy was announced. It sets the share of NEV credits from 2021 to 2023 at 14%, 16% and 18% respectively, and tightens the conditions for acquiring NEV credits. These NEV credits result from a complex calculation but are intended to increase the share of PHEVs and BEVs among carmakers.
- These last decisions should allow an increase in the production volume. As carmakers are required to comply with the new conditions specified by the policy, the impact on the NEVs market is expected to be significant. Consequently, the NEVs market (for passenger cars) could exceed 1.5 million units in 2021.
- Finally, in November 2020, the “NEV industry development plan (2021-2035)” was announced. The plan aims to increase the share of NEVs in the new vehicle market to 20% by 2025.
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