Following the preliminary audit announcement, the Ministry of Industry and Information Technology (MIIT) recently released the "Announcement on Final Audit of New Energy Vehicle Promotion and Application Subsidy Fund Settlement for 2016-2020 and Pre-allocation for 2021-2022" (hereinafter referred to as "the Announcement").
Under the support of promotion subsidy policies, China's new energy vehicle industry developed rapidly from 2016 to 2020, achieving leapfrog development during the "14th Five-Year Plan" period. Provinces and cities accelerated new energy vehicle production and sales with the support of subsidies and other favorable policies.
Statistical data from the Announcement shows that MIIT cumulatively approved subsidies totaling 1.65 billion yuan from 2016 to 2020. At the corporate level, over the five-year period, BAIC New Energy accumulated approximately 555.55 million yuan in subsidies, accounting for over 30% of total subsidy funds, with an average annual subsidy of 111 million yuan. Meanwhile, BYD Company Limited accumulated subsidies of 15.74 million yuan, representing less than 1% of total subsidy funds, with an average annual subsidy of 3.148 million yuan.
By region, six areas received over 100 million yuan in new energy vehicle promotion subsidies during the five-year period. Beijing topped the list with over 700 million yuan in cumulative new energy vehicle promotion subsidies; Zhejiang Province ranked second with approximately 303 million yuan; Hubei Province and Sichuan Province each received approximately 130 million yuan, ranking third and fourth respectively. Guizhou Province ranked last, receiving no subsidies over the five years.
Market attention has focused on the subsidy reduction amounts for automakers. Data shows that from 2016 to 2020, Chery Automobile (including commercial vehicles and new energy companies), BAIC New Energy, and BYD Company Limited (including BYD Auto Co., Ltd. and BYD Auto Industry Co., Ltd.) had the highest cumulative subsidy reductions, at approximately 237 million yuan, 163 million yuan, and 145 million yuan respectively.
Most vehicle reductions were primarily due to relevant certificates not meeting settlement notice application requirements, vehicle usage time not meeting policy requirements, incorrect vehicle registration information, and failed on-site inspections. A small number of vehicles experienced duplicate applications, failure to submit required commitment letters, failure to upload vehicle operation data as required, and vehicle registration dates earlier than recommended catalog effective dates.
**Chery Automobile Had Highest Subsidy Reductions**
From cumulative subsidy amounts, BAIC New Energy dominated, receiving over 500 million yuan in subsidy funds during the five-year period, ranking first among 11 statistical automakers and accounting for over 30% of total subsidy funds. In contrast, BYD Company Limited accumulated approximately 15.74 million yuan over five years, Chery Automobile approximately 34.66 million yuan, and Tesla 3.59 million yuan, each accounting for less than 3% of total subsidy funds.
The three major state-owned automotive enterprises showed significant differences in five-year cumulative subsidies. Dongfeng Motor Group accumulated 25.59 million yuan, the only one among the three automotive SOEs to exceed 10 million yuan in cumulative subsidies. China FAW Group accumulated 9.46 million yuan, while Changan Automobile received the least among the three SOEs at approximately 4.44 million yuan.
Regarding reduction amounts, Chery Automobile had over 200 million yuan in combined subsidy reductions over five years, with 2019 being the year with the largest reduction. Chery Automobile Co., Ltd. applied for settlement funds of approximately 161 million yuan, but actual rounded subsidy funds were only 360,000 yuan, representing a 99.78% reduction in actual subsidy amounts. Chery New Energy Automobile Co., Ltd. applied for settlement funds of approximately 69.16 million yuan, but actual rounded subsidy funds were nearly 20,000 yuan, representing a 99.97% reduction. The two companies declared 7,234 promoted vehicles, but only 23 vehicles met subsidy standards, with most vehicles reduced due to relevant certificates not meeting settlement notice application requirements.
BAIC New Energy had combined subsidy reductions of approximately 163 million yuan over five years, but received average annual subsidies exceeding 111 million yuan over the five-year period. BYD Company Limited had combined subsidy reductions of approximately 145 million yuan over five years, with average annual subsidy amounts of approximately 3.148 million yuan and reduced vehicle quantities of about 5,000 units.
Comparing preliminary and final audits, among the 11 automakers mentioned above, only FAW Group had reduced subsidy reduction amounts, by approximately 1.15 million yuan. Additionally, although some automakers didn't show significant increases in reduced vehicle quantities, combined reduction amounts increased significantly due to per-vehicle approved subsidy standards being lower than applied subsidy standards.
Changan Automobile (including Hebei Changan and Chongqing Changan) saw five-year final audit subsidies shrink by approximately 40% compared to preliminary audits. Dongfeng Motor Group only received 25.59 million yuan in subsidies in 2018 during 2017-2020, with no subsidies in other years. Multiple vehicles failed to pass applications due to duplicate applications, failed on-site inspections, and non-compliance with mileage requirements.
Furthermore, Tesla, which had no vehicle reductions in the preliminary audit, had 10 new energy vehicles reduced in the final audit, with reduction amounts of 7.61 million yuan.
**Beijing Received Over 700 Million Yuan in Five Years**
The Announcement also released pre-allocation situation tables for 2021-2022 new energy vehicle promotion subsidy funds. According to the tables, Shaanxi Province, Shenzhen City, and Shanghai City received pre-allocation funds exceeding 35 million yuan. Shaanxi Province and Shenzhen City both received high pre-allocation funds due to BYD Company Limited, totaling approximately 73.47 million yuan; Shanghai City received 35.18 million yuan in pre-allocation funds, with Tesla receiving 30.15 million yuan, accounting for approximately 85%.
Additionally, Chongqing City received 24.84 million yuan in pre-allocation funds, Zhejiang Province received 15.48 million yuan, and Jilin Province received 11.66 million yuan. Jiangsu Province, Ningbo City, Henan Province, and Sichuan Province received relatively smaller pre-allocation funds compared to other provinces and cities, ranging from 180,000 to 3.26 million yuan.
Comparing 2016-2020 regional subsidy amounts, Beijing City accumulated over 700 million yuan in subsidies during the five-year period, firmly ranking first, while Zhejiang Province received approximately 303 million yuan in subsidy funds; Hubei Province and Sichuan Province each accumulated approximately 130 million yuan in subsidies.
Reviewing subsidy information obtained by various provinces, the four provinces receiving over 100 million yuan in subsidies all have locally productive new energy vehicle enterprises, such as BAIC New Energy in Beijing, Geely Automobile in Zhejiang Province, Dongfeng Motor in Hubei Province, and Zhongzhi Yike Chengdu Automobile in Sichuan Province.
During the early development stage of new energy vehicles, regions vigorously supported new energy vehicle industry development under "dual carbon" strategies and requirements to support accelerated new energy vehicle industry development, promoting local formation of new energy vehicle "chain leader" enterprises. After nearly 10 years of development, new energy vehicle companies like BYD Company Limited and Tesla have grown robustly, rewriting domestic new energy vehicle distribution patterns. Shenzhen City and Shanghai City have shown outstanding new energy vehicle industry performance, driving local new energy vehicle and intelligent connected vehicle industry chain expansion and cultivating numerous excellent upstream and downstream component enterprises.
While implementing dynamic subsidy adjustments, improving new energy vehicle technology has increasingly become a policy support focus, with related new energy vehicle purchase tax adjustments following suit. According to the "Announcement on Adjusting Technical Requirements for New Energy Vehicle Products with Reduced Vehicle Purchase Tax" jointly issued by three departments at the end of 2023, starting January 1, 2024, vehicle models applying to enter the reduction directory must meet new energy vehicle product technical requirements. For example, pure electric passenger vehicles must have maximum speeds not less than 100km/h in 30 minutes, driving ranges not less than 200km, and power battery system mass energy density not less than 125Wh/kg. Plug-in (including range-extended) hybrid passenger vehicles must have pure electric driving ranges meeting conditional equivalent all-electric ranges not less than 43 kilometers.
The announcement appropriately raised technical indicator requirements, added low-temperature range decay technical indicator requirements, and clarified requirements for battery swap mode vehicle models. New energy vehicle models not meeting technical requirements will be removed from the tax reduction directory. These adjustment indicators fully reference implemented new energy vehicle purchase subsidies, dual credit policies, and other measures, while providing transition periods to lead new energy vehicle industry technological progress and energy-saving consumption.
During the final year of the "14th Five-Year Plan," China's new energy vehicles are showing good development momentum. China Association of Automobile Manufacturers data shows that from 2021 to 2024, new energy vehicle sales rose from 3.521 million units to 12.866 million units, with a compound annual growth rate of 38.2%, far exceeding international levels. In 2025, new energy vehicle sales are expected to reach approximately 16.5 million units (including exports), with growth rates approaching 30% and penetration rates exceeding 50%.