China to extend tax reduction on NEV purchases

China will extend the policy to reduce or waive purchase taxes on new energy vehicles amid efforts to promote high-quality development of the NEV industry and tap greater consumption potential. A government meeting noted that NEVs are a main focus of the transformation and upgrading of the automotive industry, which has broad space for development. Reductions and exemptions on NEV purchase taxes will be prolonged and fine-tuned, and high-quality charging facilities will be built to further stabilize market expectations, improve the environment for consumption and tap greater consumption potential for such vehicles, it was stated. The China Association of Automobile Manufacturers (CAAM) estimates that NEV sales in China will hit 9 million units this year, up from 6.88 million in 2022. The meeting urged efforts to consolidate and enhance the development strengths of NEVs, further optimize the industrial layout and achieve major advances in core technologies in key fields such as electric power systems, new chassis frameworks and intelligent driving systems. International and domestic resources will be leveraged in a well- coordinated way.

A sound mechanism of power battery recycling will be in place, and a vehicle-road-cloud ecosystem will be built to ensure that the entire industry chain, which promotes green development, is more self-supporting and that risks are better controlled, the China Daily reports.

Two of China’s top electric vehicle (EV) makers, BYD and Li Auto, set new monthly sales records in May. BYD, the world’s largest electric-car builder, delivered 240,220 pure electric and plug-in hybrid vehicles to customers last month, beating the previous record of 235,200 units it set in December. That represents a 14.2% increase over April and a year-on-year jump of 109%. Li Auto handed 28,277 units to domestic customers in May, setting a sales record for a second consecutive month. In April, the Beijing-based carmaker reported sales of 25,681 units, becoming the first homegrown maker of premium EVs to break though the 25,000 barrier. Both BYD and Li Auto stopped offering discounts on their cars last month, having been drawn into a price war sparked by Tesla last October.