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Dual-credit policy shows great challenges on domestic self-independent brands

Dual-credit policy shows great challenges on domestic self-independent brands
Issue Time:2017-10-27

Dual-credit policy shows great challenges on domestic self-independent brands


Fu Yuwu, Chairman of SAE-China (Society of Automotive Engineers of China) believes that the double-credit policy will have the largest impact on the auto industry among all domestic auto policies. “Although some obstacles may be encountered, the government will have a strong will to push it forward.” He also believes that dual-credit policy has put pressure on both joint ventures and self-owned brands.

According to data, NEV sales reach about 700,000 units this year. “Even if the number is expected to double to 1.4m units in the next year, the market is not large enough for all the participants including traditional companies, new manufacturers and joint-venture companies.” Fu also points that NEV market will witness fierce competition when more multi-national companies have access to build factories in China.

Dual-credit policy includes fuel-consumption credits and NEV credits, pointing out two routines including decreasing oil consumption and developing NEV technologies. According to the middle-and-long term development plan for auto industry released on April 25th, average oil consumption for new vehicles and energy-efficient vehicles will be reduced to 5.0L/100KM and 4.5L/100KM respectively by 2020. And average oil consumption for new vehicles will be reduced to 4.0L/100KM by 2025.

To cope with the dual-credit pressure, Changan Auto announced on October 19th that it plans to invest RMB 100b in the industrial chain to launch a total of 21 BEV models and 12 PHEV models by 2025. By, the using proportion of Changan 48V energy-saving technology and HEV, PHEV technologies will grow gradually. All Changan products will achieve the comprehensive application of energy-saving and alternative energy technologies by 2025, and no traditional fuel vehicles will be sold at that time.

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