China Lays Out Its Plan For Global Domination In Electric Cars

The Chinese government formally laid out its plan for ramping up its production of electric cars. It will heavily subsidise electric auto sales, as well as pay for automotive research.

It will be a nationwide effort involving “manufacturers, universities, research institutes and government agencies” all seeking to overcome the technological and safety hurdles that have daunted current efforts by the country to muscle its way into the space to this point, reports the New York Times.

Zhang Shaochun, a vice minister of finance, said that the government wanted to let the market determine which electric vehicle models would become popular. So while the government is providing some research subsidies, the main step will be to provide very large subsidies for buyers of electric cars — already up to 60,000 yuan or $8,800 for purchases by taxi fleets and local government agencies.

China will set aside 10 billion yuan ($1.46 billion) dedicated to research. The US is setting aside $25 billion to aid Detroit, notes the Times.

At this point there are very few electric cars in China, and there is no guarantee that they’ll produce a superior technology. The U.S. already had many electric cars on the road and many more in the pipeline. China may be sending a shot across the bow, but it shouldn’t even leave a dent in our hull, for now.

Obviously, there’s a risk that they could engineer a better solution, but that is why Fisker Automotive CEO, Henrik Fisker tells us, “The US must decide if it wants to be a leader,” in the electric/hybrid auto industry. He thinks the government has a chance to help companies along before competitors can clobber the US, just like Japan nipped the auto industry 25 years ago. Obviously, he’s got a vested stake in the race, as he’s hoping to receive the money.

It doesn’t negate his point, though. If China wants to race to be the first to create a massive electric car industry, then we should take that challenge. And we’ve got a slight head start.

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.