The new energy vehicle industry has entered the most stringent regulatory period, and there is zero tolerance for fraudulent subsidies

In early 2016, the General Offices of the Ministry of Finance, the Ministry of Science and Technology, the Ministry of Industry and Information Technology and the National Development and Reform Commission jointly issued the "Notice on Carrying out Verification of the Promotion and Application of New Energy Vehicles", stating that they would conduct special verification on the implementation of the promotion and application of new energy vehicles and the use and management of financial funds.

In 2016, the Ministry of Industry and Information Technology organized the preparation of a medium- and long-term development plan for the automobile industry, proposing the development direction, key tasks and policy measures for the next ten years.

On June 13, 2017, the Ministry of Industry and Information Technology issued the "Measures for the Parallel Management of Passenger Car Enterprises' Average Fuel Consumption and New Energy Vehicle Credits (Draft for Comments)" and solicited public opinions.

After two rounds of promotion and application in pilot cities, the number of new energy vehicles in my country has reached a certain scale. The next step in the management of the new energy vehicle industry will be to strengthen in-process and post-process supervision on the basis of improving relevant policies such as catalog review and safety supervision to guide the healthy development of the industry.

Zero tolerance for fraudulent subsidies

Since the beginning of 2016, new energy vehicles have ushered in a new round of policy storms. On March 7, 2017, in response to the issue of new energy vehicle subsidy fraud, Minister of Finance Xiao Jie said that fiscal subsidy funds are not "Tang Monk's meat". The Ministry of Finance attaches great importance to the issue of subsidy fraud. Some companies that have committed subsidy fraud have been publicly notified and severely punished in accordance with the law. About 2.3 billion yuan of subsidy fraud funds and fines have been recovered, and problematic vehicles will no longer be subsidized, and idle vehicles will also be temporarily suspended.

As early as the beginning of 2016, the General Offices of the Ministry of Finance, the Ministry of Science and Technology, the Ministry of Industry and Information Technology, and the National Development and Reform Commission jointly issued the "Notice on Carrying out the Verification of the Promotion and Application of New Energy Vehicles", stating that they would conduct special verification on the implementation of the promotion and application of new energy vehicles and the use and management of fiscal funds. As the investigation continued to deepen, new energy vehicle subsidy fraud companies were exposed one after another.

On February 4, 2017, the Ministry of Industry and Information Technology published administrative penalty notices on its website against seven automakers, including Jinhua Youth Automobile and SAIC Tangshan Bus. The problems of the seven companies punished this time not only showed a certain degree of complexity, but also spanned a longer period of time.

The number of battery cells of some companies is less than the number announced, and some drive motor manufacturers and battery manufacturers are inconsistent with the "Announcement of Road Motor Vehicle Manufacturers and Products". The problems faced by all the companies involved are not the same.

These seven companies are the second batch of new energy vehicle subsidy fraud companies punished by the Ministry of Industry and Information Technology. Prior to this, the Ministry of Industry and Information Technology had issued administrative penalty decisions on December 20 last year to four companies involved in "license plates but no vehicles" fraudulent subsidies: Suzhou King Long Bus, Henan Shaolin Bus, Chery Wanda Guizhou Bus, and Shenzhen Wuzhoulong Automobile.

The investigation into the fraudulent subsidy incidents of new energy vehicles has obviously not ended. At the recently concluded China Electric Vehicle Hundred People Conference, Minister of Industry and Information Technology Miao Wei emphasized that in the future, special inspections will be carried out on the promotion and application of new energy vehicles to crack down on fraudulent subsidy activities.

"No matter how many there are, we will investigate and punish them once we find them. These companies cannot escape. The state financial subsidies have not been fully paid. The money that has not been paid must be deducted, and the money that has been paid must be recovered and dealt with according to law, until the company's qualifications are revoked." Miao Wei said that the government has zero tolerance for fraudulent subsidies, and will never tolerate fraudulent subsidies for new energy. In the future, the subsidy policy will be improved, and research will be conducted on what methods to use to replace the subsidies after they are all withdrawn in 2020.

Strengthen top-level design

In 2016, the Ministry of Industry and Information Technology organized the compilation of the medium- and long-term development plan for the automobile industry, and proposed the development direction, key tasks and policy measures for the next ten years. The main idea is to control the total volume, improve quality and strengthen safety management. The plan clearly defines the development goals for 2020 and 2025. By 2025, the sales volume of new energy vehicles will account for more than 20% of the total sales volume, the specific energy of the power battery system will reach 350 watt-hours per kilogram, and intelligent networked vehicles will enter the ranks of the world's advanced. In order to achieve the planning goals, the country will also introduce an action plan to promote the development of power batteries and intelligent networked vehicles.

As the person in charge of the major electric vehicle projects and a participant in policy formulation, Zhen Zijian, director of the Electric Vehicle Major Project Management Office of the Ministry of Science and Technology, emphasized the planning for the next stage of new energy vehicle promotion. "Electric vehicles should be considered as a breakthrough for automobiles to contribute to the green and sustainable transportation system of the entire country. In other words, electric vehicles should be considered from the perspective of a certain market segment. In the large transportation system, and in the next step of promoting the electrification of the public transportation system in the process of urbanization development. How to embed electric vehicles in a green, reasonable and efficient transportation system is very necessary."

"A series of ideas emphasize the top-level design of the application system, application environment, application goals, promotion and use of electric vehicles, and the integration of the industry and urbanization development." Earlier, Su Bo, vice minister of the Ministry of Industry and Information Technology, said in an interview that the government will also consider studying and formulating clear development ideas and guidelines as well as corresponding incentive policies in the construction of charging facilities. This is a big boon for China, which is relatively backward in infrastructure construction.

In the years of promotion of new energy vehicles, in addition to the models in the catalog that meet the subsidy standards, the market has spontaneously developed many models that are in line with actual developments. The country is expected to increase subsidies for these models in the future.

Wang Binggang, a specially appointed expert and project specialist of the 863 Program of the Ministry of Science and Technology and a consultant of the China Society of Automotive Engineers, pointed out that our electric vehicles are still in the second stage of introduction, which is also a very difficult and tough period that electric vehicles must go through. Only after going through this period can we usher in a stage of rapid development. In this stage, large-scale demonstration is an important measure to accelerate introduction. The large-scale demonstration effect still requires more investment and promotion in the public sector to strengthen consumers' acceptance of new energy vehicles. It is only a matter of time before the private market is opened.

Establishing a market regulation mechanism

With the gradual decline and cancellation of the subsidy policy for the promotion of new energy vehicles, it is of great significance to establish a reasonable policy independent of subsidies and based on market mechanisms to mobilize the advantages and resources of the traditional automobile industry and cultivate and promote the development of the new energy vehicle industry. Based on this, in 2016, the National Development and Reform Commission and the Ministry of Industry and Information Technology respectively issued the "New Energy Vehicle Carbon Quota Management Measures (Draft for Comments)" and the "Interim Measures for the Parallel Management of Enterprise Average Fuel Consumption and New Energy Vehicle Credits (Draft for Comments)". Although both policies have not yet been officially released, it is clear that credit management will become an important mechanism for the development of new energy vehicles in the future. Considering that the current carbon quota plan is not yet mature, the parallel management of credits is more operational and is expected to be implemented faster, but the indicator requirements will be further improved, and the target value of the new energy vehicle credit ratio will eventually be reduced.

When talking about the future alternatives to subsidies for new energy vehicles, Miao Wei said that they are studying alternative policies after the government subsidies are completely withdrawn in 2020. "We are currently soliciting opinions online to establish a trading system using fuel consumption points for traditional cars and new energy points, and we are formulating relevant documents as measures after the subsidy policy is cancelled in 2020," Miao Wei said.

It is worth noting that on June 13, 2017, the Ministry of Industry and Information Technology issued the "Measures for the Parallel Management of Passenger Car Enterprises' Average Fuel Consumption and New Energy Vehicle Credits (Draft for Comments)" and solicited public opinions. The name of this policy is "Measures for the Parallel Management of Passenger Car Enterprises' Average Fuel Consumption and New Energy Vehicle Credits". Compared with the previous version of "Interim Measures for the Parallel Management of Enterprises' Average Fuel Consumption and New Energy Vehicle Credits" in September 2016, the word "interim" has been cancelled, which also means that this policy will become a long-term established policy. As a long-term industry product management policy, it has a far-reaching impact on the development strategy of passenger car companies and even the industrial layout of international and domestic automobile groups in the Chinese market. The introduction of the dual-credit management method reflects the country's high attention to energy conservation and emission reduction in the passenger car industry and its strong international coordination capabilities, and finally achieved the effect of advancing according to the consistent new energy management ideas and policies in recent years.

Industry analysts believe that the new energy vehicle credit system is modeled after the ZEV (zero emission vehicle credit system) in California, USA. Compared with the financial support method, the credit system is more capable of achieving sustainable development. Under the new system, it will promote healthy and fair competition among automakers and a reshuffle of the new energy vehicle market.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.