The rules could result in the production of more than 1 million EVs annually in China by 2020.
When the largest car market in the world starts talking about mandates for electric vehicles, automakers tend to listen. China has made no bones about wanting to go electric, and it’s pushing manufacturers to make it happen. The Chinese government has laid out a fairly comprehensive set of rules that include the production of plug-in hybrid, hydrogen fuel cell, and fully electric cars, mixed with a credit system that automakers must meet in order to sell in the country. Should a manufacturer fail to meet the requirements organically, credits can be purchased or fines will be paid. Either way, not shifting to alternative energy will cost money.
What does all this actually mean? Starting in 2019, auto manufacturers must meet a minimum energy score of 10 percent. For 2020, the requirement increases to 12 percent. That score is achieved through a combination of selling the aforementioned vehicles, and credits earned in the process. The whole credit process can be a bit confusing since not all low or zero-emission vehicles offer the same number of credits, but the bottom line is automakers who build or import at least 30,000 cars to China will need to start offering more green options. A lot more. And with fuel-cell vehicles not on the radar to most companies, that means electric power.
According to Bloomberg News, some manufacturers like BMW and Volkswagen are just fine with the mandate. Others like Ford are partnering up with other firms to help spur electric development. Still, it’s likely there was no small amount of push back on the aggressive measure – China was originally set to implement this plan next year, but elected to delay the rules until 2019 so manufacturers had more time to prepare.
China, along with several other countries, is looking to completely eliminate the sale of vehicles with internal combustion engines in the next few decades.
Source: Bloomberg News