China has trimmed its EV incentives by 30% for most cars. Tesla has raised prices in China twice nonetheless.
China has always said it wants it EV incentives to be reduced to zero over time. On the last day of 2021, the Finance Ministry announced the government incentive for purchasers of a so-called new energy vehicles would be cut by 30% beginning January 1, 2022. It also announced all incentives would be terminated as of the end of this year. This announcement was in line with what the government has been saying all along as it strives to boost NEV sales to 20% of all new cars sold in China by 2025.
But there’s more to the story.. NIO’s vehicles all sell for more than RMB 300,000 but have batteries that can be swapped. Therefore, its customers are still eligible for a subsidy of RMB 11,340 for a model with a standard 75 kWh battery pack or RMB 12,600 for a model with a 100 kWh battery pack. For more on this topic, see the latest video fromSupply and demand are the bedrock components of all economics.
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