China Agrees To Delay Electric Car Mandate By One Year

 

German newspaper Handelsblattr is reporting that a meeting between German Chancellor Angela Merkel and Chinese premier Li Keqiang in Berlin on Thursday led to an important new agreement regarding electric car sales in China.

electric car in China

Last September, the Chinese government proposed a new policy that would require all manufacturers to sell a minimum of 8% “new energy vehicles” — defined as plug-in hybrid, battery electric, or fuel cell powered cars — starting in 2018. The Chinese electric car mandate is very similar to one put in place recently by the California Air Resources Board.

While endorsing the idea behind the policy, virtually every car company argued the time table was too aggressive. Even though sales of the low or zero emissions vehicles are higher than in most other countries, except Norway, they still account for less than 3% of the Chinese new car market. More than doubling that number to 8% in just over one year’s time would require heroic efforts by all parties.

Officials from China and Germany have been holding high level talks on a number of issues this past week, spurred by concerns that the United States has now become a rogue nation under the leadership of Donald Trump.

Chancellor Merkel stated after the G7 conference last week that Germany and the other nations of the world must chart their own course going forward. She indicated that the US was no longer a reliable financial or political partner. The meeting with Premier Li was the first indication of a new political alignment between the nations of the world.

A statement after the meeting between Merkel and Li said only that the two leaders had found a “solution” to the problem but provided few details. Dieter Zetsche, CEO of Daimler, the parent company of Mercedes Benz, told Reuters, “What we talked about was the timeline, the pace of this transition. I think we reached a result which is satisfactory for everybody.”

Reports indicate the Chinese have agreed to roll back the target date for their new policy one year to 2019 and will allow German car companies who fail to comply initially to avoid any penalties if they increase sales of new energy vehicles later.

German automakers are strongly committed to vehicle sales in China, which now has the largest new car market in the world. At present, China requires all manufacturers who wish to build products in China to partner with a domestic company, a provision that means there is a significant transfer of technology to the domestic partners. It is believed the new understanding includes provisions that will limit how much technology transfer is required.

Source: Economic Times Auto

 

 





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I have been a car nut since the days when Rob Walker and Henry N. Manney, III graced the pages of Road & Track. Today, I use my trusty Miata for TSD rallies and occasional track days at Lime Rock and Watkins Glen. If it moves on wheels, I'm interested in it. Please follow me on Google + and Twitter.
  • Epicurus

    “More than doubling that number to 8% in just over one year’s time would require heroic efforts by all parties.”

    The Chinese should require heroic efforts. Beijing has the worst air quality of any major city in the world, doesn’t it?

    • Steve Hanley

      While I agree, Chinese customers have not exactly been falling all over themselves to buy new energy vehicles despite heavy government incentives. Sometimes policy has to be tempered by reality.

      • Epicurus

        People would buy EVs if they were all that is available. Crank up those battery factories.

  • WebUserAtLarge

    Stalling again… imho
    I wonder it this policy applies to MB only, or to all other “… virtually every car company argued the time table was too aggressive…” ICE dinosaurs on the way to extinction.

    • Steve Hanley

      Nope, it applies to all German car makers — and probably all others as well.

  • Epicurus

    The choice of EVs and PHEVs in mid 2017 is pathetic, especially in the U.S. The auto makers need a hard kick in the ass. Remember years ago when one CEO said that installation of seat belts was too expensive?

  • Disqusor

    China requires all manufacturers who wish to build products in China to partner with a domestic company, a provision that means there is a significant transfer of technology to the domestic partners.

    • Epicurus

      Right. The reds are liberating foreign ideas and technology from the running dogs of capitalism without firing a shot. Smart.