Quota cuts to put breaks on e-car sales

Growth in sales of new energy vehicles in China may slow in the second half of this year after the government cut subsidies and reduced car-purchasing quotas in major cities, according to analysis published on July 11.

The 2016 Chinese Automobile Consumers White Paper, by Nielsen Holdings Ltd and the China Association of Automobile Manufacturers, predicts a bright future for hybrids.

Consumer demand for new energy vehicles is shifting from one driven by policy to one driven by individual needs, the report says, while adding that e-car owners are young, highly educated and middle class.

"New energy vehicles will continue to experience a higher growth rate than petrol-powered vehicles in the next three years, but the threefold growth of the past two years is no longer possible," says Zhao Xinzhi, director of auto vertical of Nielsen China.

Sales of new energy passenger vehicles in 2018 will be more than triple the 200,000 vehicles sold this year, and pure-electric cars will account for the majority, he predicts.

But after 2020, he adds, when the subsidies for new energy vehicles end, petrol-electric hybrids and plug-in hybrids will experience "explosive growth".

"The three types of cars will be on the same starting line when the subsidies go, and the market will decide," says Zhao, who suggests automakers not only develop pure-electric cars, but also hybrids.

He predicts the proportion of pure-electric, plug-in hybrids and petrol-electric hybrids will change from the current 6-to-3-to-1 ratio to 5-to-3-to-2 after three years.

Annual sales of petrol-electric hybrids will be six to seven times more than last year (about 30,000 units), as more than a dozen new products will reach the market by that time, Zhao says.

According to the Nielsen report, 14 percent of potential car owners will consider pure-electric and up to 22 percent will consider plug-in hybrids. The increasing acceptance of new energy vehicles and awareness of environmental protection will become the driving force of the future sales increase, it adds.

duxiaoying@chinadaily.com.cn