Chinese Official Encourages M&As of New Energy Auto Firms to Expand and Strengthen Sector

The development of new energy vehicles in China is in a period of acceleration. Xiao Yaqing, Minister of Industry and Information Technology of China, said at a press conference on Monday that new energy automobile enterprises should be encouraged to merge and reorganize in order to become stronger and improve industrial concentration.

Xiao said that domestic new energy vehicle companies have achieved technological breakthroughs. The industry has established a complete system, and broke through key technologies such as batteries, motors and electronic control. Among them, battery technology now takes the lead in the world. Compared with 2012, the monomer energy density increased by 2.2 times, and the cost decreased by about 85%.

In terms of production, Xiao said that the driving range of new energy vehicles has been greatly improved, and many models have reached a driving range of more than 500 kilometers. Although there are still some problems with the EVs, the total mileage has been greatly improved.

“New energy vehicles in China are developing at a high speed. The driving range, charging, safety and intelligent control of new energy vehicles are important factors for consumers to consider when choosing new energy vehicles. These factors are also key points that the Ministry of Industry and Information Technology focuses on,” Xiao said.

In view of the fact that the number of new energy automobile enterprises is too large and many small firms are now scattered across the country, Xiao said that it is necessary to give full play to the role of the market, adding that the government will encourage mergers and acquisitions in the industry.

SEE ALSO: CPCA: New Energy Vehicle Exports Showed Rapid Growth in August

Xiao also said that it is necessary to speed up the construction of charging infrastructure, continue to encourage consumers in rural areas to buy new energy vehicles, and promote pilot projects for urban public transportation vehicles. Local regulators are encouraged to introduce policies such as optimizing automobile purchase restriction measures to further promote the consumption of new energy vehicles.

China’s production and sales of new energy vehicles have ranked first in the world for six consecutive years. From January to August this year, the production and sales volume of Chinese new energy vehicles reached 1.813 million units and 1.799 million units, respectively, increasing nearly twice year-on-year.