In its bid to reduce the air pollution that comes with the boom in car sales, which is the downside of being the largest auto market in the world, China will reportedly extend its “green” car subsidies.
According to Reuters, the Ministry of Finance draft rules that were published last Tuesday extend the current incentives, which were due to expire at the end of 2015, to 2020. Those incentives are granted to buyers of all-electric, plug-in hybrid and fuel-cell vehicles and the amount will be gradually scaled down from 2016 to 2020.
Initially, the subsidies for electric-powered cars will be up to 55,000 Yuan (US$8,834), while pure-electric buses will get up to 500,000 Yuan (US$80,628). Only locally-made cars are subsidized, meaning that imports from the likes of Tesla, Nissan or BMW are excluded.
In the first 11 months of the year, production of “green” vehicles in China has increase five-fold compared to the same period in 2013; yet, the industry still is behind fulfilling the government’s target of having 5 million “green” cars on the country’s streets by the end of the decade.