The B2B platform for full-electric and plug-in hybrid electric vehicles: Industry News

Experts all over the world seem to be clear about the fact that governmental aid is crucial on the way towards electric vehicle mass adoption. However, China is apparently hesitating about giving consumer incentives for the purchase of an EV. This might have already scared the first Japanese company off the Chinese market.

Even though China is among the governments that so far have announced the highest incentives in form of tax breaks, levies, subsidies and consumer bonuses to enhance the implementation of electric vehicles, there might be a problem with the direction of China’s incentives.

According to the Boston Consulting Group, China, the US and France planned to spend up to 15 billion US dollar for different incentives in the next five years. However, as regards the question of where to direct the governmental support for electric cars, China has apparently decided to not give the money to the electric car buyers. The Chinese administration is already running a 20 billion yuan incentive programme (around 1.9 billion euro) for public and service-sector vehicles, such as buses, taxis and government-use vehicles. According to the Wall Street Journal a Chinese senior official at the National Development and Reform Commission, Chen Jianguo, pointed to reservations among some officials about providing incentives for electric-car sales, since the subsidies or rebates would likely go mainly to wealthy private buyers. But that means electric car prices still remain too high for mass adoption in China.

Nissan to not produce EVs in China

The first consequences of the policy might be already seen by an announcement of Nissan’s chief executive Carlos Ghosn. He recently said that his company has no plans to produce electric cars in China, which is somehow surprising as other senior Nissan executives in China said some weeks ago that the company has been considering producing the Leaf and other future electric cars in China. In addition, Nissan is planning to sell their EVs in China by 2012. Ghosn added the decision will depend on demand for the vehicles and mentioned indirectly that the government’s lack of enthusiasm on consumer incentives for electric cars might cost China Nissan, and other electric car makers’ business.

"Government help is absolutely imperative at least over the next few years," says Mitsuhiko Yamashita, Nissan's Head of technology and product development. "Without those incentives, the electric-battery car is not going to be accepted in the marketplace anytime soon and anywhere around the world."