The Chinese Ministry of Finance will slash subsidies on new energy vehicles (NEV) such as electric, hybrid, and hydrogen fuel cell-powered cars by 20pc this year.
According to media reports, China, the world’s largest producer of automobiles, plans to sell 1.8 million NEVs in 2021, compared with 1.3 million units last year. The ministry expects NEVs to make up 20pc of all vehicles sold in the country by 2025.
Global auto giants such as Volkswagen, General Motors, and Toyota are already increasing production capacity to meet the robust demand for new cars in the country. However, the ministry plans to tighten investments in new factories to curb overcapacity.