China: Up To 6 Million Plug-In Vehicles Will Be Sold In 202
EV subsidies are reduced by 30% in 2022 and will be gone in 2023.
Plug-in electric car sales in China were growing in 2021 at a very fast rate and it’s expected that this trend will continue in 2022.
© InsideEVs Xpeng P7
During the first 11 months of 2021, more than 2.7 million passenger plug-in cars were sold, which is 14.3% of the total. Once December numbers are announced, we will see a result noticeably above 3 million (compared to more than 1.27 million and 9.4% market share in 2020).
According to the China Passenger Car Association (CPCA) (via CnEVPost), in 2022, sales of plug-in electric cars might reach 5.5 million, while the overall New Energy Vehicle volume (including commercial vehicles and buses) should be at up to 6 million.
The market share would then further increase to 22%, and most likely, the majority of plug-ins will be all-electric.
Those are pretty serious numbers that will translate into very high global EV sales, as China is the world’s largest EV market.
According to the reports, in 2022, the incentive to buy an electric car in China will be reduced by 30% compared to 2021.
We already saw it in the case of Tesla, which in November adjusted the price info for cars that were envisioned for 2022. The eligible subsidy was reduced by exactly 30% from 15,840 CNY to 11,088 CNY ($1,745).
It’s actually positive news that the market is expected to expand significantly – almost double – while the subsidies are decreasing.
In 2023, the direct subsidies will be completely removed, at least if nothing serious happens.
We guess that China has also some other mechanisms, like EV credit quotas or local incentives/ICE registration limits that help, but overall, the market is maturing and electric cars are becoming competitive enough on their own.