Development plan to keep China's lead in e-vehicle segment of auto industry

Which type of car to buy－a new energy vehicle or a gasoline-fueled one? For a long time, Shi Tianbin, 37, a software programmer and resident of Nanjing, Jiangsu province, could not make up his mind. He was not sure if buying a relatively unconventional electric car would make long-term sense.

But what finally settled the matter was the announcement in early November of China's latest development plan for new energy vehicles, or NEVs, covering the period from 2021 to 2035.

These days, Shi is busy with sales literature of various electric car models now available in the Chinese automobile market. He said he will soon buy an NEV, which could be purely electric, gasoline-electric hybrid or fuel cell-powered.

The development blueprint that the State Council, China's Cabinet, approved envisions one NEV in every five new cars on China's streets by 2035.

Shi said: "The blueprint sent us (consumers) a clear signal that e-cars will be the future trend. Going forward, the price of an NEV will become more and more competitive. Given the country's determination to promote NEVs over the long term, I asked myself, 'Why not buy an NEV?'"

Shi is among the millions of Chinese consumers as well as automakers who are inspired by the new development plan that aims to make China a self-reliant powerhouse in the NEV sector over the next 15 years, complete with competitive technologies, strong brands and world-class quality.

Xin Guobin, vice-minister of the Ministry of Industry and Information Technology, said: "The new development plan, which follows the previous plan released in 2012, is an important guideline for the future development of the country's NEV sector.

"Amid the new round of technological revolution and industrial transformation, leading countries across the world are expected to beef up their presence in the NEV sector. China's NEV sector will embrace its rare opportunities."

The ambitious target was set after China quickly recovered from the economic effects of COVID-19. It is also in line with the proposals for drafting the 14th Five-Year Plan (2021-25), which recommended policy push to boost spending in emerging sectors, including NEVs, in coming years.

While it is well known that China is the world's largest automobile market, not so well known is the fact that the country is also the world's biggest market for NEVs.

During the 13th Five-Year Plan period (2016-20), China highlighted the role of strategic emerging industries, including clean energy and new energy vehicles. The plan called for more efforts to support the development of these new industries, in order to help China evolve into a manufacturing powerhouse.

In response, China is quickly switching gears to consolidate its lead in the NEV sector in a comprehensive manner, if industry data are any indication. Besides domestic sales, rising exports of NEVs are brightening China's image in the global e-car market.

For instance, on Oct 27, Tesla's Gigafactory in Shanghai exported 7,000 Model 3 e-car units to Belgium, from where they will be further shipped to European countries including Germany, France, Italy, Portugal and Switzerland. Ten months back, Tesla delivered the first batch of Model 3 units to the Chinese market.

At a ceremony to mark the occasion, Chen Yin, executive vice-mayor of Shanghai, said, "The China-made Tesla e-cars exported to Europe are proof of the nation's capability and competitiveness in manufacturing advanced new energy vehicles."

Agreed Zhu Xiaotong, Tesla's global vice-president and head of Greater China. He said at the event, " (This) is showcasing to the world not only the speed and efficiency of Chinese construction, but also the quality of Chinese manufacturing."

Ren Zeping, chief economist with Evergrande Group, said after 10 years of planning and development, especially during the 13th Five-Year Plan period (2016-20), the country's NEV industry has already gained certain first-mover advantages and scale advantages. A basic industrial chain and charging infrastructure have been formed, he said.