Beijing hints at further subsidies for alternative-fuel vehicles

PUBLISHED : Friday, 10 September, 2010, 12:00am
UPDATED : Friday, 10 September, 2010, 12:00am

Beijing may expand subsidies on alternative-fuel vehicles to manufacturers and builders of recharging stations for pure electric cars after the State Council yesterday called for faster development of new-energy cars.

Xu Changming, a director at the State Information Centre, told the China Business News that the government would study the scope of financially supporting the state grids to build infrastructure for recharging stations and that some carmakers could hope to get subsidies to develop the technology for new-energy cars. Xu, however, did not elaborate.

The government now subsidises consumers up to 60,000 yuan (HK$68,500) to buy a pure electric car and 3,000 yuan to buy a hybrid. Xu's statement on the possibility of more subsidies could be interpreted as another push by the central government to realise the goal of commercialising alternative-fuel vehicles.

Beijing has been encouraging carmakers to produce environmentally friendly vehicles on a bigger scale as a way to continue leading the world's automobile market after the nation became the biggest car market by selling 13.6 million vehicles last year. But no domestic carmaker has taken the government's cue.

'We are still faced with a situation of immature technologies, backward infrastructure and other challenges and problems,' said Wan Gang, minister of science and technology, an advocate of alternative-fuel vehicles. 'We need to accelerate the development of electric vehicles.'

Pure electric carmaker BYD, which is backed by billionaire Warren Buffett, has said a mainland mass-production plant for its E6 pure electric car cannot be completed this year.

The chairman of the Shenzhen-based company, Wang Chuanfu, has said the target to export the E6 to the United States by the end of the year cannot be met either and would have to be pushed back to the second half of next year because of a shortfall in battery production capacity.

According to the government's China Automotive Technology and Research Centre, retail deliveries of cars, SUVs and multipurpose vehicles rose 59.3 per cent last month to 977,300 units from a year earlier after Beijing started subsidising fuel-efficient models since June and offering huge discounts to dealers. This growth was much faster than the 15.4 per cent rise in July.

Meanwhile, the China Association of Automobile Manufacturers yesterday said manufacturers had delivered 1.02 million cars to dealers in August, up 18.7 per cent from the same period last year and higher than the 13.6 per cent growth in July.