The country hopes to provide help and stimulate the economy in these tough times.
According to a recent report by Teslarati, Chinese Premier Li Leqiang announced that new energy vehicle subsidies will be extended in China for two more years. This follows the country's massive COVID-19 outbreak, which resulted in factory shutdowns and a negative impact on the economy.
Not only is it imperative that countries like China work hard to stimulate the economy, but the original goal of promoting clean and sustainable energy is paramount. The subsidies will help domestic EV makers, including Tesla since it has built an automotive plant in China that produces vehicles for the domestic market. Battery-electric vehicles, plug-in hybrids, and fuel-cell vehicles all qualify for China's incentives.
In order for a battery-electric vehicle to qualify for current subsidies in China, it has to provide over 400 km (~250 miles) of range. Cars fitting the description are eligible for an incentive worth 25,000 yuan ($3,600) off the purchase price of the vehicle.
In addition, the report states that the program will allow fleet manufacturers and operators extra time to secure needed financing for projects and purchases. Moreover, the Chinese government will "use fiscal money to compensate the replacement of diesel vehicles in key areas such as Beijing, Hebei and Tianjin."