Photo/Shetuwang

Dec. 14 (NBD) -- December is usually a peak season for car sales. However, China's new energy vehicle (NEV) market is facing a cold winter this December.

Subsidies for NEVs face significant change next year

Regarded as the biggest NEV market in China, Beijing's NEV market has witnessed unexpected low sales recently.

NBD noticed that many NEV 4S stores in Beijing even have neither customers nor cars in stock.

A sales person of Zotye Auto located in Beijing told NBD that all electric cars have been sold out and their store has stopped to restock since December.

It's not clear for how NEV policies will change, a sales person from a 4S store of Changan Automobile in Beijing said, adding that so far, subsidies for NVEs have been reduced by over 20 percent. Car dealers won't risk restocking under such circumstances, the person said.

It's reported that from next year, the amount of the subsidies will vary with the endurance mileage of the electric cars. The subsidies for the NEVs with more endurance mileage are expected to be increased, while the ones for those electric cars with less endurance mileage are estimated to be dramatically reduced.

For example, the subsidy for NEVs with the endurance mileage of 180 kilometers such as Changan flagship car "Changan BenBen" is likely to be cut by 50 percent, added he.

At present, each "Changan BenBen" is subsidized 54,000 yuan (8,177.7 U.S. dollars). A 50 percent reduction means customers have to spend 27,000 yuan (4,088.9 U.S. dolalrs) more for the same model. Therefore, they cleared the inventory of "Changan Benben", leaving room for other models with the endurance mileage above 256 kilometers.

Shortage of purchasing quota gives birth to new businessses

Though the subsidies for electric cars are forcasted to be reduced, the NEV 4S stores still found few consumers purchasing new cars.

The shortage of purchasing quotas for electric cars in Beijing has discouraged consumers from buying new ones.

It is noted that Beijing approves such quotas in different batches each year which has to be used within half a year.

Statics show that as of December 8, more than 120,000 people are waiting for new quotas. Quotas for 2018 have been overdrawn in previous years, thus some applicants have to wait until 2019.

Against such background, a new trade is emerging.

Notices of "extending quota" and "renting quota" can be noticed in front of the door of many 4S stores.

Consumers without quota will be able to buy a new car by renting someone else's quota. For people who hold the quota but not rush to buy a car, they can extend the validity period of their quota for another half year by buying a new car but transferring it to others.

More and more customers are looking for a rent because of the reduction of subsidies for NEV cars, a salesperson of Chery 4S store noted. A yearly purchasing quota for NEVs is priced from 2000 (302.9 U.S. dollars) to 9000 yuan (1,663.0 U.S. dollars) per year.

However, it is worth noting that the renter could be reliable for accidents occurring to the person who purchased the car using the rented quota, said Wei Shibing, senior partner of Beijing-based Dacheng Law Office.  

Email: tanyuhan@nbd.com.cn