China’s Ban on Fossil Fuel Vehicles Unfeasible Until 2025

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Experts say that the ban on fossil fuel vehicles recently mooted by a top Chinese official will remain unfeasible until at least 2025.

Xin Guobin, vice-head of China’s Ministry of Industry and Information Technology, said at an auto forum in Tianjin over the weekend that the Chinese government is working on a timetable for ending the production and sale of fossil fuel vehicles.

The announcement generated heavy attention in the domestic and international media, as well as pushed shares in BYD, China’s biggest manufacturer of electric vehicles, up as much as 7.2% to HKD$50.65.

“Many countries around the world are adjusting their development strategies, and accelerating industrial deployment in the areas of clean energy and connected smart cars to seize the new high ground of production,” said Xin.

“Some countries have already formulated timetables for suspending the production and sale of traditional fuel vehicles…the Ministry of Industry and Information Technology has also already launched its own relevant research, and will formulate a timetable for China with relevant departments.

“This move will inevitably prompt profound changes in the environment and drivers for the development of China’s automobile industry.”

Xin did not provide any concrete details on the prospective timetable for a ban on fossil fuel vehicles, and ministry officials have thus far not been amenable to Chinese media requests for more concrete information.

Outside experts have weighed in on the matter, however, and pointed out that given developments in other economies it may be feasible for China to begin phasing our fossil fuel vehicles by the mid-2020’s.

Xu Nan, a researcher with CCID Consulting, said to Eeo.com that “from the current perspective, for China the likelihood of achieving [a fossil fuel vehicle ban] by 2025 isn’t great.

“Amongst European nations Germany has the earliest official timetable, proposing a full ban on sales by 2030. But this plan is also considered too extreme.”

As of the end of last year China’s national vehicle inventory was nearly 200 million , with sales of passenger cars reaching 24 million in 2016 alone.

Clean energy vehicles still have a comparatively low market penetration rate, however, with sales for last year at roughly the half million mark.

Xu said that while hopes for a full ban on fossil fuel vehicle sales within a decade are unlikely, the government is still intent upon promoting the use of cleaner vehicles.

“Although given current circumstances a comprehensive sales ban is unlikely to arrive that soon, this does not rule out the accelerated introduction of coordinated policies as national production of clean energy vehicles rapidly advance,” he said.

“The two will mutual influence each other, and expedite the accelerated progress of the clean energy sector.

“The period from now until 2025 will be the most intense years for the reform of the vehicle sector, when companies must acquire a deep understanding of new trends and make prompt strategic adjustments.”

 

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