Shanghai Authorities Offer Electric Car Subsidies


While many governments around the world seem to be fretting and delaying the introduction of significant financial subsidies for the electric car market, the same cannot be said of China. The Chinese authorities have already earmarked Shanghai as the first city to be used in the development of electric vehicles, with a raft of incentives already in play. However, there is more to this than just individual financial incentives.

Current financial subsidies

At this moment in time the Chinese authorities are offering around U.S. $6,400 as a subsidy against an electric vehicle and in excess of U.S. $4,000 as a part payment against a plug-in hybrid vehicle. The motoring system in Shanghai is very different to that in many other countries as consumers have to "bid" at auctions in order to secure licence plates for their vehicles. However, it seems as though the Chinese authorities have put aside 20,000 registration plates for energy-saving cars which will be offered free.

The auction price of car licence plates has increased dramatically over the last 12 months and is now around 35% higher than at the start of the year which equates to around U.S. $10,000 per license plate.

Where do the financial subsidies go?

At this moment in time the financial subsidies will be paid direct to car manufacturers, who will then be able to pass on these cost savings to consumers. The government is also making further financial incentives available with a relatively small Y300 subsidy available for all recycled electric car batteries. This will certainly make the car manufacturers around China sit up and listen, because at the end of the day money does talk.

The subsidy system will be highly regulated by the Chinese authorities and while there are some concerns of potential fraudulent activity, or "cooking of the books", this is unlikely. This is a country which is certainly embracing the electric vehicle movement and which is in many ways putting to shame the Western world.

Quote from : "Hello, has anyone tried to import electric cars from China? They cost around $ 6200 and comes with a DOT certification."

Charging facilities

One interesting development over the last few months has been the introduction of financial subsidies to legal companies and legal entities, which are able to "persuade" more than 10 employees to buy electric cars at any one time. The idea is that the subsidies will be used to create charging points for these vehicles and very quickly we should see a relatively large network begin to take shape.

Charging facilities are a major bone of contention within the electric vehicle market because car manufacturers are concerned about the ability to get the most out of their high tech vehicles. Consumers are also concerned about the reliability, and in many ways the safety of long journeys in electric vehicles, therefore the more charging points the Chinese government can facilitate and encourage the better for all involved.


There is certainly demand for electric vehicles across China and Shanghai will be used as the first pilot city for an array of new financial initiatives. The government has certainly grasped the eco-friendly element of electric travel and it seems again that China, together with Japan, could end up being relative light years ahead of the rest of the developed world.

Many governments have been talking of electric car subsidies, tax breaks and various financial initiatives, but very few have been able to deliver to the extent that the Chinese authorities have so far. It will be interesting to see what reaction this prompts from the U.S. government, UK government and other governments around the world.