HAMBURG/SHANGHAI(Reuters) – Global automakers have urged China to delay and soften planned quotas for sales of electric and hybrid cars, saying its proposals will be impossible to meet and would severely disrupt their businesses, according to a letter seen by Reuters.
The June 18 letter addressed to the head of China’s Ministry of Industry and Information Technology, is the most cohesive pushback yet from the industry against ambitious targets for so-called new energy vehicles in the world’s biggest auto market.
Keen to combat air pollution, China is planning to set goals for electric and plug-in hybrid cars to make up at least a fifth of Chinese auto sales by 2025, with a staggered system of quotas beginning in 2018.
Beijing also sees the policy as a means to help the domestic car industry to compete with foreign rivals that have decades more experience in internal combustion engines.
The strict new rules plus planned harsh penalties for non-compliance, such as the cancellation of licenses to sell non- electric cars in China, has the potential to cause much pain for some automakers in the market.
“This will hit the industry pretty hard, especially well-known companies,” said Liping Kang, senior manager at the Innovation Center for Energy and Transportation, a Beijing-based think tank.