China – One of the World’s Largest Electric Vehicle Market

According to the survey report “Global EV Outlook 2019”, of the International Energy Agency, China remained the world’s largest electric car market with nearly 1.1 million electric cars sold in the year 2018, up from almost 600,000 numbers in the year 2017. Moreover, the region accounted for 55% of the global electric car market. Apparently, the electric two-wheeler market, which is led by China, produced 26 million vehicles in the year 2018 and had an estimated 250 million units in circulation. Furthermore, about 54,000 electric LCVs (mostly BEVs) were sold in the region during the same year.

Electric vehicle sales in China is increasing at a massive pace owing to increasing concerns for severe air pollution levels in the region, along with stringent norms of the government for curbing environmental pollution and supportive policies that outlooks to enhance the efficiency of vehicles. Additionally, increasing need of the nation to reduce its dependence on oil imports, along with restrictive actions taken by the government to limit the issue of registration permits for combustion-engine vehicles, along with the increasing investments for deploying electric vehicle charging infrastructure across cities in the nation are some of the factors that are estimated to contribute to the growth of the China electric vehicles market.

Additionally, development of several new policies, such as the New Energy Vehicle (NEV) mandate policy illustrated by the Ministry of Industry and Information Technology (MIIT) of China, which is a modified version of California’s Zero Emission Vehicle (ZEV) mandate, that promotes compliance of new energy vehicles so as to meet the goals of enhancing efficiency of electric vehicles, along with other supportive policies initiated by the Electric Vehicles Initiative (EVI), which is a multi-governmental policy forum, established in the year 2009 under the Clean Energy Ministerial, are some of the factors anticipated to drive the growth of the China electric vehicle market during the forecast period.

Increasing Focus on Developing Publicly Accessible EV Charging Infrastructure

According to the survey report “Global EV Outlook 2019”, of the International Energy Agency, China remained the country with the world’s largest installed publicly accessible charging infrastructure, and further accounted for around 78% of the global share of publicly accessible fast chargers in the year 2018.

China as a nation, having one of the world’s largest electric vehicle fleet, also aims to focus on developing the EV charging infrastructure that can be accessed publicly. Having a well-developed infrastructure for charging the electric vehicles also helps to increase the confidence of consumers to purchase an electric vehicle, as the major concern for electric vehicles is with its charge efficiency. Presence of a well-developed infrastructure of publicly accessible chargers for EVs is thereby anticipated to promote towards the growth of the China electric vehicle market in the upcoming years.

Restraints

Decreasing Subsidies for EV Manufacturers

The government of China initially imposed high subsidies to let consumers adopt electric vehicles in the region. With the region gradually being one of the largest markets for electric vehicles, subsidies are gradually decreased for major varieties of electric vehicles, which is anticipated to impact negatively towards the growth of the China electric vehicle market during the forecast period.