Electric cars: China exends EV subsidies beyond 2015(Read article summary)
Electric cars will continue to be subsidized in China as part of a continuing effort to jump-start plug-in sales and reduce air polution. Subsidies for electric cars will continue beyond 2015.
China plans to continue its electric-car subsidies as part of a continuing effort to jump-start plug-in sales, which so far have been minimal, and reduce air pollution.
The Chinese government announced Saturday that it will¬†extend electric-car subsidies past the 2015 expiration date,¬†Reuters¬†reports.
The current subsidies of up to 60,000 yuan (about $9,800) apply not only to pure battery-electric vehicles, but also to "near-electric" plug-in hybrids, and hydrogencars. However,¬†hybrids are not eligible.
These subsidies will be allowed to expire in 2015 as planned, but will be replaced with new incentives that will "preserve policy continuity," according to¬†Reuters.
Details of the new policy will be released later at an unspecified date.
In the meantime, China will cut the current¬†electric-car incentives¬†by 5 percent this year, and 10 percent in 2015,¬†Bloomberg Businessweek¬†reports. Those cuts are smaller than originally anticipated.
Maintaining subsidies will help China reach the goal of putting half a million "new-energy vehicles"--including battery electrics, plug-in hybrids, and hydrogen-fuel cell vehicles--on the road by 2015, and 5 million by 2020.
An influx of greener vehicles would help solve one of China's major problems: air pollution.
Last November, the World Health Organization (WHO) found Chinese outdoor air pollution causes lung cancer, and increases the risk of bladder cancer.
Last year, China became the¬†first nation to surpass 20 million new car sales, and while vehicles are far from the only sources of air pollution in the country--industry and coal-fired power plants are the main sources--there has been considerable public pressure to lower emissions.
Despite the pollution problem and the existence of government incentives, Chinese consumers have¬†not shown much enthusiasm for electric cars.
Lack of technical expertise has also made it¬†tough for local automakers to develop electric cars.
Nonetheless, high-profile U.S. electric-car startup Tesla Motors is optimistic about the future prospects for electric cars in China. CEO Elon Musk believes¬†China could become his company's biggest market.
The Model S electric luxury¬†sedan¬†doesn't currently qualify for subsidies, but Tesla hopes that will change.
The¬†car¬†is priced in China at 734,000 yuan (about $121,000)--compared to its U.S. base price of around $80,000--due to taxes and shipping costs.