In Depth: New Rules Set to Give State-Owned Carmakers an EV Boost

Some have fallen behind in EVs, but changes to encourage their development risk squeezing out private firms

While China’s three major state-owned carmakers may be latecomers to electric vehicles (EVs), Beijing is pushing for the trio to catch up.

New-energy vehicle (NEV) sales still make up a relatively small proportion of the total vehicle sales of China FAW Group Co. Ltd., Chongqing Changan Automobile Co. Ltd., and Dongfeng Motor Corp. Ltd. Observers put this down to the state-owned enterprises’ (SOEs) aversion to risk and short-term mindset.

At March’s “Two Sessions”, the annual meetings of China’s top legislative and political advisory board, the country’s state-assets czar announced that the government would set new evaluation criteria for the trio’s EV businesses to support their development.

Heavy investment is inevitable in the early stages of NEV development, and auto SOEs’ concerns about profit assessments hinder their progress in this field, according to Zhang Yuzhuo, chairman of the State-owned Assets Supervision and Administration Commission (SASAC). “The assessment adjustments aim to remove these barriers,” he said.

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