China leads the world in deployment of electric vehicles. At the end of 2017, 40% of electric
cars in the world were in China. China dominates global markets for electric buses, low-speed
electric vehicles and electric two-wheelers.17
In 2017, roughly 777,000 electric vehicles were sold in China. Of these, roughly 579,000 were
light-duty passenger vehicles (a 73% increase from the prior year and 2.7% of all light-duty
passenger vehicles sold). Roughly 198,000 were commercial medium- and heavy-duty EVs
(mostly large buses). As of year-end 2017, more than 1.7 million light-duty and commercial
electric vehicles were on the roads in China.19
Electric bicycles are omnipresent in China today. More than 200 million electric two-wheelers
are on the roads in China, with roughly 25 million new units sold each year.21
Low-speed electric vehicles (LSEVs) are also a growing presence in some parts of China.
These LSEVs generally have maximum speeds of no more than 70 kilometers per hour (40
miles per hour), short ranges and lead acid batteries. Roughly 1.2 million–1.5 million were
sold in 2016. (These are not counted in tallies of electric vehicles sold.) LSEVs are especially
popular in Shandong Province.22
The number of EV charging stations in China is growing rapidly. The country’s total number of
stationary charging points—ports for plugging in electric vehicles—reached 450,000 in 2017,
including around 210,000 publicly accessible units. Massive new installation of EV charging
stations was underway in China in 2017, with estimates for the amounts to be installed by
year-end running as high as 800,000, including at least 100,000 public charging stations.23
China has hundreds of auto manufacturers, many of which are owned in whole or in part by
provincial or local governments. According to some reports, as many as 200 Chinese auto
manufacturers have produced electric vehicles. The quality of these products has been uneven.24
In the short term, China’s deployment of electric vehicles will have little impact on CO2
emissions. Because coal dominates the Chinese electric power sector, CO2 emissions from
electric vehicles in China are on average roughly comparable to those from conventional
gasoline- or diesel-powered vehicles. (The exact comparison depends on assumptions
with respect to the fuel efficiency of conventional vehicles and many other factors. Some
studies have found that CO2 emissions from electric vehicles are currently greater on a lifecycle
basis.) However, as coal’s role in the Chinese power sector declines, as called for in
Chinese government policy and planning documents, electric vehicles have the potential
to significantly reduce CO2 emissions from the Chinese vehicle fleet. In the medium to long
term, vehicle electrification will be important in meeting the Chinese government’s goals with
respect to the transition to a low-carbon economy.25
“Developing new energy vehicles is essential for China’s transformation from a big automobile
country to a powerful automobile country. We should increase research and development,
seriously analyze the market, adjust existing policy and develop new products to meet the
needs of different customers. This can make a strong contribution to economic growth.”
— President Xi Jinping (May 2014, visiting an electric vehicle factory in Shanghai)26
The Chinese government strongly supports electric vehicles. Central government policies
include a target of 5 million electric vehicles on China’s roads by 2020, EV quotas for
vehicle manufacturers and importers, manufacturing subsidies, tax exemptions, government
procurement, and support for the construction of electric vehicle charging stations. Many
provincial governments also support electric vehicles with preferential access to license plates
and other incentives. These policies have three principal goals: to clean the air in China’s cities,
reduce China’s oil import bills and position China for global leadership in a strategic industry.27
Under regulations announced by the Ministry of Industry and Information Technology (MIIT) in
September 2017, each vehicle manufacturer and importer will be required to make or import
at least 10% electric vehicles starting in 2019. The percentage will increase to 12% in 2020.
These regulations apply to any company that manufacturers or imports more than 30,000
vehicles in China. Companies that fail to achieve the required percentages may purchase
credits from companies that overcomply.28
The Chinese government also offers subsidies to manufacturers of electric vehicles in China.
These subsidies are roughly $5,000–$7,000, depending on vehicle size. The subsidies are
scheduled to be cut 40% in 2019 and eliminated in 2021. In 2016, the Chinese government
fined five electric vehicle manufacturers for falsifying records with respect to electric vehicles
to collect government subsidies.29
The Chinese government exempts electric vehicles from consumption and sales taxes, which
can save purchasers tens of thousands of RMB (equivalent to thousands of dollars). It also
waives 50% of vehicle registration fees for electric vehicles.30
The Chinese government also uses its procurement power to promote electric vehicles. A May
2016 order requires that half of new vehicles purchased by China’s central government be new
energy vehicles within five years. Beijing’s municipal government plans to replace the city’s
70,000 taxicabs with electric vehicles.31
Electric vehicle infrastructure is central to China’s EV program. The Chinese government has
announced two goals with respect to deployment of electric vehicle chargers: 800,000 by
the end of 2017 and 5 million by 2020. To help meet these goals, the central government
subsidizes construction of charging stations, issues guidelines on charging technology
standards and provides policy support to municipal governments. China State Grid and China
Southern Grid, China’s two state-owned electric utility monopolies, both have programs to
promote the development of electric vehicle charging infrastructure.32
Many Chinese provincial and local governments are very active in promoting electric vehicles.
Several municipalities—including Beijing, Shanghai, Guangzhou, Tianjin and Shenzhen—
provide license plates immediately at no cost to any purchaser of an electric vehicle. (This
is an enormous incentive, since license plates for conventional vehicles can cost thousands
of dollars and take years to secure.) Free and preferential parking spaces are also common.
Some municipalities—including Beijing and Shanghai—pay local manufacturers subsidies for
new energy vehicles (including EVs). Municipalities play a central role in the deployment of
electric vehicle chargers. Beijing and Shenzhen have both announced that their entire taxi
fleets will transition to electric vehicles within several years.34
In pursuing these policies, Chinese government officials are guided in part by earlier efforts to
promote electric vehicles that were not entirely successful. In 2012, for example, the Chinese
government set a goal of deploying 500,000 electric vehicles by the end of 2015. It reached
this goal one year late. That and other problems have led to a series of measures, including
increased focus on EV charging infrastructure (to give EV drivers confidence they’ll be able to
recharge), policies to promote consolidation among EV manufacturers (to help improve the
quality of EV products) and efforts to fight local protectionism (to prevent balkanization of
the market by favored manufacturers in each province).35
Chinese central government policies with respect to electric vehicles are set forth in a number
of documents, including:
● Planning for the Development of the Energy-Saving and New Energy Automobile
Industry 2012–2020 (June 2012)36
● Accelerating the Promotion and Application of New Energy Automobiles (July 2014)37
● Guidance on Accelerating Electric Vehicle Charging Infrastructure (October 2015)38
● 13th Five-Year Plan for National Strategic Emerging Industries39
● Guidelines for the Development of Electric Vehicle Charging Infrastructure (2015–2020)40
In September 2017, Xin Guobin, a deputy minister at MIIT, said at a news conference that
government officials are studying a possible timetable for phasing out sales of gasoline-powered
cars in China. This announcement received considerable international attention,
however it was not an official statement of Chinese government policy. To date the Chinese
government has not announced a timetable for phasing out sales of gasoline-powered cars.41
17. IEA, “Global EV Outlook 2018” at p.111 (table a.1), https://webstore.iea.org/download/direct/1045?fileName=Global_EV_Outlook_2018.pdf.
19. China Association of Automobile Manufacturers, “Statistics” (January 15, 2018); “China Plug-in Sales for
2017-Q4 and Full Year – Update” (accessed April 28, 2018). See also http://www.autonewschina.com/en/
article.asp?id=17104; “EV Sales 2017,” EV-sales (January 2018), http://ev-sales.blogspot.ca/2018/01/chinadecember-2017.html; http://www.ev-volumes.com/country/china/.
20. IEA, “Global EV Outlook 2017” at p.50, https://www.iea.org/publications/freepublications/publication/
21. Ibid. at pp.27–28; Qian Zhecheng, “China to Roll Out Stricter Standards for Electric Bikes” (January 17, 2018), http://www.sixthtone.com/news/1001569/china-to-roll-out-stricter-standards-for-electric-bikes.
22. IEA, “Global EV Outlook 2017” at pp.27–28.
23. Ibid. at p.32; Economic Daily News, “充电桩企业5年或将洗牌 卖硬件转型卖服务” [EV charger companies might change from selling hardware to service in 5 years], China Association of Automobile Manufacturers (April 7, 2017), http://www.caam.org.cn/xiangguan/20170407/1105207119.html; Michael J. Coren, “China is selling more electric vehicles than the US—and it’s not even close,” Quartz (May 3, 2017), https://qz.com/972897/china-isselling-more-electric-vehicles-than-the-us-and-its-not-even-close/; Echo Huang, “China wants its electric-vehicle owners to have the best charging experience ever,” Quartz (April 28, 2017), https://qz.com/970263/china-wantsits-electric-vehicle-owners-to-have-the-best-charging-experience-ever/; “China to build more charging points for electric vehicles,” Xinhua (February 9, 2017), http://english.gov.cn/state_council/ministries/2017/02/09/content_281475563292566.htm; Xiao Ying and Teng Jing Xuan, “China’s Electric Vehicle Charging Stations Idle 85% of Time,” Caixin, https://www.caixinglobal.com/2018-01-22/chinas-electric-vehicle-charging-stations-idle-85-of-time-101201234.html
24. China’s Quest to Grow Its Electric Vehicle Market Relies on Heavy-Handed Policy Intervention,” Emerging
Strategy (March 29, 2017), http://www.emerging-strategy.com/article/chinas-quest-to-grow-its-electric-vehiclemarket-relies-on-policy-intervention/.
25. Qian Zhang et al., “Electric Vehicle Market Penetration and Impacts on Energy Consumption and CO2 Emission in the Future: Beijing Case,” Energies (2017), http://www.mdpi.com/1996-1073/10/2/228/pdf; Qiao Qinyu et al., “Cradle-to-gate greenhouse gas emissions of battery electric and internal combustion engine vehicles in China,” Applied Energy (May 10, 2017), http://www.sciencedirect.com/science/article/pii/S0306261917305433; Mark Buchanan, “China’s Electric Cars Are Actually Pretty Dirty,” Bloomberg View (July 11, 2017), https://www.bloomberg.com/view/articles/2017-07-04/china-s-electric-cars-are-actually-pretty-dirty; Rachael Nealer, David Reichmuth and Don Anair, “Cleaner Cars from Cradle to Grave (2015),” Union of Concerned Scientists (November 2015), http://www.ucsusa.org/clean-vehicles/electric-vehicles/life-cycle-ev-emissions#.WY2kfq2ZM_X.
26. “Local governments claim jurisdiction over e-vehicle charging industry,” Lexology (October 24, 2016), https://www.lexology.com/library/detail.aspx?g=7b412498-e60f-4b36-87e7-2b1789eebc9e#4.
27. See State Council, “节能与新能源汽车产业发展规划(2012–2020)” [Energy Saving and New Energy Auto Industry Development Plan (2012–2020)] (June 28, 2012), http://www.gov.cn/zwgk/2012-07/09/content_2179032.htm; Jack Gao and Diana Zhou, “Driving The Future Of Future Driving: Scaling Up Adoption Of Electric Vehicles In China,” Kennedy School Review (August 10, 2016), http://harvardkennedyschoolreview.com/driving-the-future- of-future-driving-scaling-up-adoption-of electricvehicles-in-china/; Anders Hove, “These four lessons will help China win the electric vehicle market” (May 9, 2017), https://www.chinadialogue.net/article/show/single/en/9773-These-four-lessons-will-help-China-win-the-electric-vehicle-market; “China’s Quest” (March 29, 2017); Michael J. Dunne, “China Deploys Aggressive Mandates To Take Lead In Electric Vehicles,” Forbes (February 28, 2017), https://www.forbes.com/sites/michaeldunne/2017/02/28/china-deploys-aggressive-mandates-to-stay-no-1-inelectric-vehicles/#2a94ac0c6a82.
28. Ministry of Industry and Information Technology, “Average Fuel Consumption of Passenger Vehicles and Parallel Management of New Energy Vehicles” (September 27, 2017), http://www.miit.gov.cn/n1146290/n4388791/c5826378/content.html; “China Gives Automakers More Time in World’s Biggest EV Plan” (September 28, 2017),https://www.bloomberg.com/news/articles/2017-09-28/china-to-start-new-energy-vehicle-production-quotafrom-2019;http://www.scmp.com/business/companies/article/2115124/renewed-policy-incentives-keep-chineseev-carmakers-afloat.
29. Shiqi Ou, Zhenhong Lin, Zhixin Wu, Jihu Zheng, Renzhi Lyu, Steven Przesmitzki and Xin He, “A Study of China’s Explosive Growth in the Plug-in Electric Vehicle Market” (January 2017) at p.43, https://info.ornl.gov/sites/
publications/files/Pub72210.pdf; Bloomberg Markets, “Phantom Sales, Faked Papers Found in China EV Subsidy
Probe” (September 8, 2017), https://www.bloomberg.com/news/articles/2016-09-08/phantom-sales-faked-papersfound-in-china-auto-subsidy-probe. Subsidies and other incentives are also available for the fuel cell vehicles, although these have a tiny market share. See “新能源汽车推广补贴方案及产品技术要求” [New Energy Vehicles Subsidy Scheme Plan and Technical Requirements], http://www.miit.gov.cn/n1146290/n4388791/c5449767/part/5449778.pdf.
30. Zolzaya Erdenebileg, “Shifting Gears: Investing in China’s Electric Vehicles Market,” China Briefing (May 11, 2016), http://www.china-briefing.com/news/2016/05/11/china-shifts-gears-electric-vehicles.html; IEA, “Global EV
Outlook 2017” at p.55; “China’s Quest” (March 29, 2017).
31. Zolzaya Erdenebileg, “Shifting Gears” (May 11, 2016). See also Ou, Lin, Wu, Zheng, Lyu, Przesmitzki and He, “A Study of China’s Explosive Growth” (January 2017) at p.36; Trefor Moss, “China, With Methodical Discipline,
Conjures a Market for Electric Cars,” Wall Street Journal (October 2, 2017), https://www.wsj.com/articles/chinawith-methodical-discipline-takes-global-lead-in-electric-cars-1506954248.
32. See NEA, “Guidelines for the Development of Electric Vehicle Charging Infrastructure (2015–2020),” http://
www.nea.gov.cn/134828653_14478160183541n.pdf; (中华人民共和国国务院), “China to build more charging points for electric vehicles” Xinhua (February 9, 2017), http://english.gov.cn/state_council/ministries/2017/02/09/
content_281475563292566.htm; IEA, “Global EV Outlook 2017” at p.32; Dale Hall, Marissa Moultak and Nic Lutsey, “Electric Vehicle Captials of the world,” International Council of Clean Transportation (March 2017) at p.5, http://www.theicct.org/sites/default/files/publications/Global-EV-Capitals_White-Paper_06032017_vF.pdf.
33. Source: NEA, “Guidelines for the Development of Electric Vehicle Charging Infrastructure (2015 - 2020)”34,
34. Ou, Lin, Wu, Zheng, Lyu, Przesmitzki and He, “A Study of China’s Explosive Growth” (January 2017) at pp.39–40; Hove, “These four lessons” (May 9, 2017); Hall, Moultak and Lutsey, “Electric Vehicle Captials of the world” (March 2017) at p.39; “China’s Quest” (March 29, 2017); Dunne, “China Deploys Aggressive Mandates” (February 28, 2017).
35. See generally Gao and Zhou, “Driving the Future of Future Driving” (August 10, 2016).
36. See State Council (中华人民共和国国务院), “节能与新能源汽车产业发展规划(2012–2020)” [Energy Saving and New Energy Auto Industry Development Plan (2012–2020)] (June 28, 2012).
37. State Council (中华人民共和国国务院), “国务院办公厅关于加快新能源汽车推广应用的指导意见” [Guidance on
Accelerating New Energy Vehicles Promotion and Application] (July 21, 2014), http://www.gov.cn/zhengce/
38. State Council (中华人民共和国国务院), “国务院办公厅关于加快电动汽车充电基础设施建设的指导意见” [Guidance on Accelerating Electric Vehicles Charging Infrastructure Construction] (October 9, 2015), http://www.gov.cn/zhengce/content/2015-10/09/content_10214.htm.
49. “国务院关于印发“十三五”国家战略性新兴产业发展规划的通知” [13th Five-Year Plan for National Strategic Emerging Industries Development] (December 19, 2016), http://www.gov.cn/zhengce/content/2016-12/19/content_5150090.htm. See US Information Technology Office, “State Council Announces the 13th FYP for Strategic and Emerging Industries,” http://www.usito.org/news/state-council-announces-13th-fyp-strategic-and-emerging-industries.
40. NEA, “Guidelines for the Development of Electric Vehicle Charging Infrastructure (2015–2020).”
41. Wu Yihao, “E-car segment revs up to push throttle full forward,” China Daily (October 9, 2017), http://www.