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CAAM: China’s July NEV sales see first on-year rise

China’s production and sales of new energy vehicles (NEVs) saw their first year-on-year growth this year in July, rising by 15.6% and 19.3% respectively, according to the latest statistics of the China Association of Automobile Manufacturers (CAAM) published on August 11.

In July, production of NEVs totalled 100,000 units and sales topped 98,000 units, CAAM’s data showed. July also saw higher output and sales of conventional internal combustion engine vehicles, increasing by 21.9% and 16.4% on year to reach 2.2 million units and 2.1 million units, according to CAAM.             

The rises in the NEV sector came later than the growth in China’s overall auto output and sales, which have been positive since April, Mysteel Global noted.

Signals from the central government promoting clean energy vehicles have remained strong. Ning Jizhe, vice-minister of the National Development and Reform Commission stressed in an interview on August 5 that in the second half of this year Beijing will continue to encourage certain cities to raise car purchasing quotas and ease the limitations on buying NEVs. He added that subsidies for buying NEVs will be offered, as part of the policy package to drive up domestic consumption.

“In Shanghai and Beijing, buyers of NEVs now will not have to go through a license plate lottery and (moreover) governments are offering subsidies,” an official with a steel mill based in East China’s Jiangsu province commented. “Now that sales of NEVs are robust, this will drive up part of the demand for flat steel.”

In these two cities, buyers of NEVs will be granted an exclusive license plate, whereas buyers of conventional gasoline cars will have to apply for a license plate through a lottery-like online registry, a process which can sometimes drag on for years. The strict caps on plate permits are measures that China’s biggest cities have employed to ease pollution and traffic congestion, Mysteel Global notes.

“If other major cities such as Shenzhen and Guangzhou (both in South China’s Guangdong province) catch up and liberalise the allocation of licence plates, the synergy effect will be stronger,” the steelmaker said.   

A recent buyer of a Tesla vehicle in Shanghai received subsidies of over Yuan 20,000 ($2,878), but he said that the subsidies have contracted over the past few years. “The subsidies were to be cancelled this year or next year, but in order to give a boost to the auto industry, the governments have decided to extend it to 2022,” he observed. 

Over January-July, China’s production of NEVs reached 496,000 units, still down 31.7% on year, according to CAAM’s statistics, while sales reached 486,000 units, down 32.8% on year.

Chinese auto production over January-July totalled 12.3 million units while sales reached 12.4 million units, down 11.8% and 12.7% respectively, according to CAAM.

Written by Olivia Zhang, zhangwd@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com