Zhang Xiang, a researcher at the Jiangxi New Energy Technology Institute, said, "The extension of preferential purchase tax policy for NEVs will further stimulate people's willingness to spend on NEVs, unleash consumption potential and give a big boost to the development of the NEV industry."
Chinese NEV manufacturers should invest more in the research and development of NEVs, accelerate technological innovation and roll out new models of vehicles, Zhang said. "The sales of NEVs are mainly focused on the first- and second-tier cities, but there is immense growth potential in lower-tier cities, townships and rural areas for NEVs."
More efforts are needed to speed up the layout and construction of public charging infrastructure, especially in rural areas, and the recycling of power batteries, in order to support the development of NEVs and satisfy people's charging demands, Zhang added.
China's NEV segment has witnessed rapid growth this year. Sales of NEVs in the country expanded 60.2 percent year-on-year to 717,000 units in May, data from the China Association of Automobile Manufacturers showed.
In the first five months of the year, NEV sales increased 46.8 percent from a year ago to 2.94million units, and NEV output totaled over 3 million units during this period, increasing 45.1 percent year-on-year, the CAAM said.
Li Xiang, founder and chairman of Chinese electric vehicle startup Li Auto, welcomed the four-year stable policy for NEVs and reiterated the company's ambitious goals in a post on Sina Weibo, China's Twitter-like platform. Li Auto aims to sell 1.6 million vehicles by 2025, with its revenue reaching 500 billion yuan, he added.
Nio, another EV startup, said consumers will enjoy the more favorable purchase tax policy and save more when buying a pure EV, compared with premium fuel-powered vehicles, adding that the move will shore up demand for automobiles.