Electric car sales collapse in China without subsidies

At the start of the year, purchase premiums for an electric car in China were gradually eliminated. And the effects were immediate: last September, the drop in sales of these cars was 34%. Proof, if necessary, that without public incentive, the market would probably experience another dynamic.

Many observers wonder if the electric car market is not, in part, artificially supplied by governments. In France, for example, it is possible to benefit from 6000 € reduction (subject to the price of the vehicle) on the catalog price. In China, the policy is similar. Or rather “was” similar, since the government cut the bonus in half at the start of the year, from around € 6,500 to € 3,300. And this in anticipation of the final removal in 2020.

The Chinese political leaders justified themselves by the fact that the manufacturers took advantage a little too much of the government bonuses to make profits easily and not to advance technology. 

The reduction in the bonus has already had effects: while the progression of electrics has turned at more than 100% for several months, it collapsed last September, with a 34% drop in sales. And this should intensify with the total cessation of the bonus in 2020, while some manufacturers like Tesla are launching more intensively on the first world market with a factory built on site.

These declines come at a crucial moment, when China announces that it wants 25% of sales of new hybrid and electric cars by 2025. For now, the two engines combined only account for 4% of the Chinese market.