China has announced that it is extending it’s green vehicle subsidies to 2020. The current incentive plan was set to expire at the end of 2015.
The policy represents China’s latest effort to fight severe pollution and snarling traffic and is a boon to firms such as BYD Co., the country’s biggest maker of electric vehicles.
Subsidies will be granted to buyers of EV, highly electrified plug-in hybrid and fuel-cell vehicles, with the amount of subsidies gradually scaled down during the period from 2016 to 2020, according to the draft rules posted on the Ministry of Finance’s website.
China has rolled out a series of policies to encourage sales of green vehicles, hoping the industry can help China fight pollution and reduce the country’s reliance on imported oil.
Production of such vehicles in China has jumped five-fold during the first 11 months of this year compared with 2013, but the industry still far lags Beijing’s goal of putting 5 million new-energy vehicles on Chinese roads by 2020.