MIIT of the PRC Releases the First Recommended Batch of NEVs in 2019
COVID-19 and China
The Xpeng G3 model's debut. Photo: Credit to Xpeng.

The Ministry of Industry and Information Technology (MIIT) released the No. 316 document related to on-road automobile production enterprises and products. In the document, the first batch of new energy vehicles (NEVs) in 2019 is disclosed. Total 106 models are included in the list, in which 98 models belong to pure electric vehicles from 48 enterprises and 8 models are plug-in hybrid electric vehicles from 7 enterprises.

Xpeng Auto, one of the EO500 list enterprises, has a model HMA7004S68BEV listed in the batch. The model listed is probably the second mass production model of Xpeng Auto. In December 2018, Xpeng Auto delivered its first mass production model G3. Comparing to the G3 model, the second model does not have any obvious improvements in the technological side – both batteries’ energy density is 145 Wh/Kg and both ranges are 365 Km as listed in the document.

The range of NEVs in the latest list is dense in 300-500 Km and some ranges are even above 500 Km. The range is one of the most influential for customers to consider an NPV. The ascending range demonstrated in the list reflects the demand for longer-range NPV. The subsidy policy will be terminated by 2020 and after two years of subsidy adjustment, the requirement for NPV to be eligible in applying subsidy programs is stricter year by year. Lower-range NPVs are being swept out by the market when the subsidy is no longer effective and hence reduced interests of buying from the customer side.

The document signals that the government is reducing the subsidy degree to prepare for the coming of 2020, when the market will be the main force or driver in adjusting the NPV market. Before 2020, the NPV market is yet to be boomed. Besides the new force of car manufacturing, the force of new retail will also accelerate the trend of NPV. Besides the below-expectation range, another restriction that hinders China’s NPV’s growth is the infrastructure of charging pole network.

NPV’s mobility range is bounded within tens of miles per charge and the urge to build NPV’s charging pole network is the main task for the auto industry in 2019. Otherwise, when the state stops subsidizing the industry, the future would be dim for a within-city automobile – an automobile with limited mobility, especially when same-price internal combustion engine (ICE) automobile could offer more, would not be appealing to potential buyers. The construction of infrastructure and technological breakthrough would back up NPV to compete with ICE automobiles when favored subsidy policy suspended.

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