Sunday, June 24, 2012

China considering subsidies to develop energy-saving vehicles

There are many ways to reduce greenhouse gas emissions and one of them is through large scale use of energy-efficient vehicles. The impact of the intended reduction is made more significant if it is done in countries with the most number of vehicles. China is one of them and it is currently eying subsidy provision to develop energy-saving vehicles, together with the necessary infrastructures.

New stylish car charging station by GE Energy. Image:

China's subsidy plan

Reuters cited a report by Shanghai Securities News last week that China is considering tax exemptions and subsidies for buyers of energy-saving vehicles in an attempt to boost its low-emissions auto sector. 

In 2009, Beijing introduced a similar stimulus package with tax incentives for cars with engine sizes of 1.6 liters or smaller and subsidies for rural residents. That move spurred car sales and helped China surpass the United States as the world's largest auto market.

Under the new proposal, those purchasing electric vehicles or hybrid cars would be exempt from a vehicle purchase tax, the paper said, citing Zhang Xiangmu, secretary of the Ministry of Industry and Information Technology.

The paper separately quoted a car association official saying that electric car buyers would also get a sales rebate as well as a reduction in the value-added tax. While plans to construct charging facilities for electric vehicles would support the country's demand for a raft of base metals, including copper.

The government said in May that it plans to spend up to 2 billion yuan ($315.06 million) from this year to help develop energy-saving vehicles to cut carbon emissions.


Malaysian car buyers incentive?

Not really a subsidy, but Malaysia government encourage the purchase of energy-saving cars - in particular hybrid vehicles - by exempting import duty and and excise tax for such vehicles. Unless there changes in the policy, this will be enforced until the end of 2013.

The Honda Insight has been upgraded for 2012. Image:

As a result of the tax exemption, a 1.3 litre Honda Insight is marketed in Malaysia at RM99,800 and recently some adverts put a RM97,000 price tag (on the road). Toyota Prius has also seen the launch of a new 1.5 litre Prius C or known as Aqua in Japan, for the same price tag of RM97,000. From the consumers' perspective this is good as it gives options and promote improvement via competition.

Apart from that, there have not been many incentives for electric vehicles in Malaysia. National car manufacturer, Proton, has been talking about designing and producing electric cars for sometime now but the end result is yet to be seen.


Betty Manousos said...

very interesting and informative post! i'm glad i learned a new thing today.

your flower photos on your previous post are truly stunning.

i love your blog!

tehr said...

aku memang berkenan dengan kereta elektrik ni
tapi harganya mahal sangat
tak mampu nak beli

de engineur said...

@Betty Manousos - Glad that this could be of help. Thanks, the flowers are beautiful, they grow in the wild

@tehr - harap2 lebih murah bila Proton keluarkan model kereta elektrik sendiri nanti