The decline leads to structural upgrades and the new policy on subsidies for new energy vehicles is in place

The subsidy adjustment plan for new energy vehicles is expected to be implemented in the near future, and the industry will enter a new stage of development. On December 8, the China Association of Automobile Manufacturers reported that the 2016 new energy vehicle subsidy policy has been signed by four ministries and is expected to be released this month.

According to statistics on motor vehicle factory certificates, in November 2016, my country produced 84,000 new energy vehicles, a year-on-year increase of 16.21%; among them, the output of special-purpose vehicles was 15,900 vehicles, a year-on-year increase of 77.78%; from January to November 2016, the cumulative output of new energy vehicles was 402,800 vehicles, a year-on-year increase of 44.27%.

It is expected that after the new energy vehicle subsidy adjustment plan is officially released, the new national subsidy policy will decline significantly compared with the previous version, and the decline in some models will reach 60%. This will trigger changes in the domestic new energy vehicle market structure.

Among them, pure electric logistics vehicles will receive greater support. Due to the serious subsidy fraud of electric buses, this proportion is decreasing. The demand for ternary batteries will increase, becoming the two major directions of the development of the new energy vehicle market.

"The five years from 2016 to 2020 are a critical period for the introduction and cultivation of the new energy vehicle industry, and the government and enterprises still need to make tremendous efforts." Wang Binggang, a special expert on the Ministry of Science and Technology's 863 Plan major scientific and technological project on electric vehicles, said that in the future car purchase subsidies will be withdrawn and replaced by normal incentive policies based on environmental and energy factors, and private purchases will be the main focus.

On the corporate side, judging from the annual report forecasts of automobile companies that have been disclosed so far, the effectiveness of the implementation of new energy subsidy policies has become a key word and barometer of corporate profit trends.

After BYD achieved a five-fold surge in net profit last year, the company's net profit in 2016 may reach 5.2 billion yuan, continuing to maintain a high growth rate. The new energy vehicle business will continue to maintain a good development momentum. In terms of traditional vehicle business, the continued hot sales of BYD SUV models will drive the steady growth of the group's traditional vehicle sales.

Affected by the subsidy fraud incident, King Long Automobile announced that the penalty for subsidy fraud will have a significant impact on the company's operating performance in 2016. On September 9, King Long Automobile issued an announcement stating that the penalty on Suzhou King Long will directly reduce the net profit attributable to the parent company in 2016 by 315 million yuan, which will have a significant impact on the company's operating performance in 2016.

From January to October, Asiastar Bus sold a total of 3,765 buses, a year-on-year increase of 35%. From a detailed perspective, from January to October this year, Asiastar sold a total of 2,883 large buses, a year-on-year increase of 84%; 455 medium-sized buses, a year-on-year decrease of 46%; and 427 light buses, a year-on-year increase of 10%.

Zhongtong Automobile has received 2036.11 million yuan in cumulative subsidies for the promotion of new energy vehicles in 2015 from the Liaocheng Finance Bureau. This amount will directly reduce the company's accounts receivable from the sale of new energy buses. The receipt of this amount of funds will improve the company's cash flow, reduce financing costs, and have a positive impact on operating performance.

New energy vehicles are heating up and accelerating

2016 was a landmark year for new energy vehicles to gain widespread recognition. Prior to this, the government introduced various forms of incentive policies to make up for the lack of product technology maturity and high initial costs, and quickly launched the market.

Recently, the Ministry of Industry and Information Technology and the National Development and Reform Commission have issued and formulated a series of industrial policies for the new energy vehicle industry chain, mainly focusing on access conditions, points management, carbon emissions, etc. From the perspective of the policy itself, supervision has become stricter, but on the other hand, the new policy is more conducive to the healthy development of the industry, and for the leading companies in the industry, the concentration may be further improved.

In addition, charging facilities are ushering in a period of intensive policy dividends. According to the recent seminar on urban smart transportation held by Beijing Enterprises Clean Energy Group, charging infrastructure will become the focus of industrial policy support in the future, and the intensity and refinement of policy support will be significantly improved. It is expected that a unified central government subsidy mechanism and tax support policies will be introduced.

It is estimated that the total investment demand for charging facilities in the entire industry during the 13th Five-Year Plan period is about 160 billion to 180 billion. Currently, various parties are "scrambling to grab land" with different models. Some industry insiders believe that investment opportunities mainly lie in combination with public transportation systems and distribution network construction.

Chen Qingtai, former deputy director of the Development Research Center of the State Council, also believes that the industrialization of electric vehicles must ultimately rely on the market. Pure electric logistics vehicles will receive greater support. Due to the serious fraud of subsidies for electric buses, this proportion is decreasing, and the demand for ternary batteries will increase, which is more in line with market needs.

Dongwu Securities believes that the fourth batch of catalogs is a reshuffle and reconstruction based on the first three batches of catalogs. The vehicle manufacturers and models included in the catalog, as well as the power batteries they carry, are all products of enterprises that are included in the power battery industry standard conditions catalog. In the future, based on safety and efficiency, vehicle manufacturers will bind large-scale battery manufacturers to ensure stable battery supply and controllable quality. With the implementation of the new energy vehicle promotion catalog, it is expected that in 2017, the production and sales of automakers will be strong, and the sales of new energy vehicles are expected to grow rapidly.

Of course, facing strong foreign competitors in the same industry, China's new energy vehicles, especially the battery industry, will still face huge competitive pressure in the future. However, the development of an emerging industry is bound to face a competitive environment of survival of the fittest. Enterprises that do not adhere to technological innovation and industrial sentiment will lose not only subsidies, but also the market and the future. Only industry leaders who meet challenges and pay attention to trends can accumulate strength and win the future.

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.