The Supervision of New Energy Vehicles Becomes More Rigorous and “Without Proof”

Recently, the Ministry of Industry and Information Technology, the Ministry of Finance, the Ministry of Commerce and other five ministries and commissions jointly held the “Concurrent Management Method for Average Fuel Consumption and New Energy Vehicle Integration of Passenger Vehicle Enterprises”, Song Qiuling, deputy director of the Department of Economic Development of the Ministry of Finance, stated: The Chinese government is working to investigate new energy vehicle production capacity to confirm whether there is excess.

According to insiders, the investigation of whether the capacity of new energy vehicles is overcapacity has already begun. Although the person did not disclose the specific directions and methods of the investigation, he only said that he had to “look back”. From this point of view, the government will trace the actual utilization of existing capacity of various new energy vehicle companies.

According to previous statistical data, more than 200 new energy vehicle projects have been launched since 2015, and the planned production capacity has exceeded 20 million vehicles, involving over one trillion yuan in funds. However, from the actual sales of new energy vehicles, the actual sales of new energy vehicles in 2016 was only 500,000, and in January-September 2017, the sales volume was only 340,000.

According to the new energy vehicle capacity planning, the sales of new energy vehicles will only reach 2 million in 2020. Therefore, from the data alone, the planned production capacity has far exceeded the actual market demand. However, people in the industry believe that planning production capacity does not equal actual production capacity, and there are too many uncertain factors in the final landing.

What is certain, however, is that this investigation of excess capacity means that the government’s attitude towards new energy vehicles has begun to become more cautious with full support from before and will be more stringent in supervision. Just prior to this, the government suspended the issuance of new energy vehicle production qualifications and significantly raised the threshold for declaration of production qualifications.

According to the subsidy management measures, newly entering new energy vehicle production enterprises need qualifications to obtain government subsidies, and it can be foreseen that the final production capacity will surely be compromised. However, many companies that have already entered the enterprise need to cooperate with companies that have obtained production qualifications, or directly purchase enterprises that possess the qualifications for producing new energy vehicles, resulting in the occurrence of “probably not born”.

Up to now, the government has issued 15 new energy vehicle production qualifications. Judging from the progress of each carmaker. The development of "veteran veterans" is relatively rapid. Most of the mature models have been introduced to the market. In contrast, “recruits” are few mature models. It is expected that cars will be introduced to the market by the end of this year or next year, and even some companies will remain in the original prototype.

“There are companies that have already obtained qualifications and have capacity but do not do R&D and not go into production. For example, some companies that previously produced passenger cars, special vehicles, logistics vehicles or modified cars did not plan to use new energy sources. The industry invests, but hopes to make money through resale. This may be the focus of this capacity inspection.” Wang Binggang, head of the New Energy Vehicle Technology Innovation Engineering Experts Group said.

From this point of view, the government's supervision of new energy vehicles is gradually strengthening, and some companies that want to use the new energy vehicles to “fish out” will become even more paranoid in the future. However, even those who are painstakingly cultivating new energy vehicle industry may not be able to succeed. From the previous quarter’s financial report released by the relevant car companies, there are many people who suffer a sharp drop in performance or even a loss, so the new energy vehicle industry may not be like a besieged city. The people outside are so beautiful.