Analysts Have a Warning for Electric Car Makers in China

China spent billions of dollars in promoting greener cars. After the subsidies, China turned to world’s biggest market for electric vehicles. Makers of electric vehicle ignore investing in manufacturing licenses rather they prefer to apply for innovations in concern with design and technology.

Analysts give warning to electric car makers to protect them from landing a solid downward curve in securing permits for manufacturing and selling of new vehicles.

China is the one who built electric car market with the subsidies of $ 4.5 billion, which are around to 3.63 billion pounds. China expects to lower fuel import to improve the quality of air. Manufacturers got subsidies for each of the car being sold. These subsidies can be more than three times of the price of a model like BYD’s e6.

warning for electric car makers in China

The Number of models is planned from Chongqing Changan and SAIC Motor. General Motors is going to launch a new concept of the car having new energy plans.  Future Mobility, WM Motors, and LeEco Companies are developing the green car technology. These companies are a startup in the field of electric vehicles. They have spent hundreds of millions for the development.

In between January to October there was the total sale of 337000 new energy vehicles in China. This sale included all the electric as well as plug-in hybrid models. The stats shows growth as compared to last year but it is still low as compared to China’s expectation. China has a target of selling 5 million new energy vehicles till 2020.


After crackdown of manufacture companies making low standard products and game plan of attracting people with subsidy schemes, there has been tightened state support. New rules were introduced for those who have to the will of applying for the license of all kinds of electric cars.

New rules included intellectual property rights, supports plans for sales and after sales, research and development, trial productions of minimum 15 cars and so on. Safety regulations were also introduced for new energy vehicles. These safety rules include battery testing which promises tougher life for weaker firms.

After the month of March, it has been noticed that few companies have been granted licenses. This company list included all auto industry veterans like Chery and BAIC Motor. Some of the leading startup companies like Foxconn and Tencent have not applied for licenses still. They commented that they are yet not completely ready for making cars or they may be expecting for a change in rules.

The head of manufacturing at NextEV, Mr. Jack Cheng said that they do not wish to invest their capital in manufacturing. Being honest he also added that there might be a change in government policies again.

The chairman of electric vehicle startup named Kaiyun Motors commented that in place of applying for license directly he would buy a straggler of petrol car maker whose license can also be used for manufacturing electric vehicles. This process can allow firms in producing cars in their existing factories without applying for permissions of new plant setups.

Via : Gadgetsnow

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