China extends subsidy program for electric vehiclesFebruary 19, 2014
Subsidy program has been extended in order to bolster EV sales
The Chinese government has announced the extension of subsidies meant to promote the adoption of electric vehicles. The government has been struggling with an air pollution epidemic, which is choking major cities for life and causing serious health issues among a wide range of people throughout the country. In order to cut down on air pollution, the government has put a stronger focus on clean transportation. Several large cities have established goals concerning the number of electric vehicles needed to curb emissions production. Interest behind these vehicles is almost wholly supported through government subsidies.
Program struggles to promote clean transportation
Despite the availability of subsidies from the Chinese government, electric vehicle sales have been slow throughout the country. The subsidy program began in 2009, but has become somewhat unpopular due to confusion concerning the program’s limitations. The program offers as much as $9,800 for those purchasing electric vehicles, $5,800 for those purchasing hybrid vehicles, and more than $80,000 for the purchase of an electric bus. The program itself is riddled with limitations that have proven quite difficult to understand. These limitations have made it a challenge for the subsidies to even be accessed, thereby reducing the interest consumers have in clean vehicles.
EV sales fail to impress throughout the country
Originally, the program was due to begin phasing out at the end of 2015, but the Chinese government has extended the program in an effort to bolster electric vehicle sales. The problem, however, is that many of the limitations that have made accessing subsidies in the past are expected to remain in place. These limitations have had a poor effect on the EV market in China. In 2012, some 11,241 electric vehicles were sold throughout the country. In 2013, only 14,606 of these vehicles were sold. By comparison, more electric vehicles have been sold in the state of California than have ever been sold in China.
Large cities take steps to limit the use of emissions-producing vehicles
Subsidies have helped promote an interest in clean transportation, but whether or not the extension of the subsidy program will help China combat air pollution has yet to be seen. Subsidies are, of course, not the only measure in place to combat air pollution. Beijing has initiated a plan that limits the number of licenses that can be issued to new drivers, thereby limiting the number of emissions-producing vehicles that are operating in the city.