China Announces Massive Electric Car Initiative

China is pushing automakers to embrace battery-powered vehicles by announcing it would eventually ban the sale of gasoline- and diesel-powered cars in the country. The reports gave no possible target date, but China’s industry ministry is reportedly developing a timetable for implementation. France and Britain has also announced plans to end sales of gasoline and diesel cars.

The Chinese government wants automakers to build and sell electric cars powered entirely by rechargeable batteries. At the Shanghai auto show last spring, more than 190 different models of electric cars were on display. Chinese officials announced at China’s main annual automotive technology conference that they would be introducing policies that would help attract more foreign investment in its new-energy vehicles.

Under the current plans, sales of battery-powered cars in China could top 400,000 by 2019, making up about two-fifths of the world’s sales of such cars. China is also investing heavily in car-charging stations and research. Beijing-based consulting firm Gao Feng Advisory estimates that China will have spent about $15 billion installing charging stations for electric cars by 2020.

Under a plan called Made in China 2025, China hopes to improve its ability to develop innovative new technologies and make it less dependent on foreign technology. New Chinese regulations pressure foreign automakers to transfer electric-car technology to the local partners they must work with to operate in the country. Global automakers say that they must comply with the policies to grow in a country that is now the world’s largest car market. The Chinese car market is now almost as big as the American and European markets combined.

General Motors, Volkswagen and other major automakers have made regular cars with Chinese partners for decades. G.M. is now collaborating with the Shanghai Automotive Industry Corporation on advanced hybrid cars and is making China the hub of its electric car research and development. Ford Motor and Renault-Nissan are both planning joint electric-car ventures, with China’s Zotye Auto and China’s Dongfeng Motor, respectively.

The opportunities in the Chinese market could help Western companies reach their own electric car ambitions faster. However, the size of China’s car market gives any policy changes an outsize importance for the global industry. Michael Wessel, a commissioner of the United States-China Economic and Security Review Commission, said, “Multinational firms are already starting to cave in to China’s policies, putting in jeopardy the future of this sector and countless jobs and economic benefits.”

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