China Vows to Boost Car Sales, EV Charging Facilities

(Bloomberg) -- China, the world's biggest car market, aims to boost auto sales and add more charging facilities for electric vehicles this year.

The government will encourage “steady increases” on spending on cars and “abolish excessive restrictions” on the sale of used vehicles, Premier Li Keqiang told the National People's Congress in Beijing on Friday.

More car parks, EV charging stations and battery-swapping facilities will be built, and battery recycling systems developed at a faster pace, Li said.

Overall vehicle sales are expected to rise this year for the first time since 2017, reaching about 27.2 million units, according to the China Association of Automobile Manufacturers. Demand for EVs offered by the likes of Tesla Inc. and China's Nio Inc. should help drive the rebound.

About 54% of China's oil consumption is used for transportation. So far, the government has focused on shrinking that by boosting a nationwide electric vehicle fleet that's already the biggest in the world. Sales of new energy vehicles, including electric autos, soared 281% in January.

Global automakers have been spending tens billions of dollars making cars more environmentally friendly as consumers and governments increasingly shy away from gas-guzzlers. In China's blueprint for the development of new energy vehicles, industry regulators estimated that EVs may rise to 20% of total new car sales by 2025 from the current 5%.

Chinese government incentives include extending subsidies on NEV purchases, expediting a clear-out of older polluting vehicles, reducing taxes on used-car dealers and promoting electric-car sales in rural areas. The policies are helping lift carmakers out of a three-year downturn. NEV sales rose 9.8% in 2020 to 1.11 million units, despite the heavy hit brought by Covid-19.

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With assistance from Bloomberg