China spent billions of dollars to boost the competitiveness of its local electric vehicle industry, according to a new study published last week by Germany’s Kiel Institute for the World Economy quoted by Bloomberg. The think tank, which advises the German government, said that China’s aid to domestic new energy vehicles amounted to roughly $5.6 billion until 2022 when the direct payments to manufacturers were phased out.
Compared to other countries that offer some sort of subsidy for the purchase of a new environmentally friendly vehicle, including the United States, the biggest difference in China was that the state gave the money to the car makers and not the buyer. Approved NEV purchase subsidies in China - Top 20 NEV purchase subsidy recipients Even though this particular support scheme has been phased out, China’s battery electric vehicle buyers are exempt from paying a 10% purchase tax.