When subsidies for "weaning," will officially open a new energy vehicle race

After a wave of fraud in the new energy vehicle (NEV) subsidy system, the government adjusted its policy to prevent abuse and restore credibility. As the eligibility criteria became stricter, many vehicles failed to meet the requirements. In 2016, nearly half of all NEVs did not qualify for subsidies, and some continued to log over 30,000 kilometers—essentially running "marathons" without proper support. Recently, the Ministry of Industry and Information Technology conducted an expert review of the second batch of supplementary liquidation applications for 2016, resulting in the “First Review Report on Supplementary Liquidation Audit of New Energy Vehicles for the Promotion and Application of the Second Batch of 2016.” According to Cui Dongshu, Secretary General of the National Passenger Vehicle Market Information Association, the number of approved subsidies for 2016 is now less than half of the total production and sales for that year. This discrepancy is largely due to the strict 30,000-kilometer mileage requirement, which he argues is an outdated standard that hinders the growth of passenger NEVs. In 2016, 517,000 NEVs were produced, and 507,000 were sold. However, only 238,000 applications for subsidies were submitted, with 228,000 approved. The total funding requested was 29.6 billion yuan, while 28.8 billion yuan was approved. Of this, 21.5 billion yuan went to passenger cars, and 7.17 billion yuan to commercial vehicles. Major recipients included Yutong (6.5 billion), Zhongtong (3 billion), and BYD (2.7 billion). For passenger cars, the top three subsidy recipients were BYD (3.12 billion), BAIC New Energy (850 million), and Geely (750 million). Currently, bus subsidies are significantly higher than those for passenger cars. For example, Yutong alone received close to the total amount given to all passenger car models. Even though BYD achieved global sales leadership by selling over 100,000 NEVs in 2016, it only received subsidies for 5,574 buses, which was less than what Yutong received. Similarly, BAIC sold over 50,000 NEVs but had only 18,000 subsidies approved, likely due to the 30,000-kilometer rule. To correct these imbalances and get the industry back on track, the revised subsidy policy, delayed until December 30, 2016, introduced stricter rules: only non-individual users could apply for subsidies, and vehicles needed to reach a cumulative mileage of 30,000 kilometers. These changes aim to ensure that subsidies go to genuine users and prevent abuse, but they also raise concerns about fairness and long-term sustainability.

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