The Dragon reaches a new record and doubles consumer subsidies to further increase sales of electric and hybrid cars
Just three years ago, sales of electric and hybrid cars were 7% of the market
In July, there was a boom in sales of electric and hybrid cars in China, where, for the first time, the psychological threshold of 50% was exceeded. A little more than half of the vehicles sold in the country last month were hybrid or electric. The merit of the incentives for green cars, but not only.
The Fast Growth of the Dragon
This represents a significant increase compared to three years ago, when only 7% of sales were for low-emission vehicles. Sales of these vehicles increased by 37% compared to July 2023, with a 14.3% increase for pure electric cars.
Chinese success is due to several factors. Firstly, local culture seems more open to adopting electric vehicles than others. Think of the US, where in the first quarter of 2024 only 18% of sales were for electric or hybrid cars. China also has the world’s largest charging network and an extensive high-speed rail network, making adoption easier.
The factors driving electric cars in China Another crucial factor is government subsidies that have lowered production costs, allowing Chinese companies to stay on the market without having to generate profits based on normal market dynamics. These subsidies have helped to make electric vehicles more accessible and popular among consumers.
However, despite progress in the industry, overall car sales in China fell by 3.1% in July. This is the fourth consecutive month of decline, owing to low consumer confidence and the ongoing real estate crisis. To counter this trend, the Chinese government has announced new measures. At the end of July, he said he would double the subsidy programmes introduced in April. This means that cash incentives of up to 2500 euros will be offered to purchase cars.
