With China’s rapid economic growth in the past decade, fortunes were made as the country experienced an economic boon. However, this fast-paced growth also had its costs. During this growth period, air pollution and traffic congestion increased dramatically in many major cities around China. Now the government and businesses alike are developing ways to solve the costly side effects of rapid economic expansion.
To fight the problem of air pollution, the Chinese government has unveiled a new round of subsidies for fuel-efficient, electric vehicles. This government program is designed to promote energy saving and air pollution reduction in China. Alongside this program, government officials hope to put at least five million “new energy” vehicles on the road by the year 2020. This is a rather lofty goal, but extremely necessary as pollution in China has been a major problem for its citizens and visitors from overseas.
Subsidies from the Chinese government also affect the international business community in terms of the global auto industry. As Chinese automakers hope to expand their electric car business with subsidies, these same predominantly domestic vehicles may be exported around the world someday. However, a lot must happen for this to be true as previous electric car subsidies failed to provide a large boost in Chinese electric car sales. Around the world, electric cars are beginning to catch on in environmentally conscious countries such as United Stated with Tesla Motors and in Japan with Nissan. Despite their increasing popularity, the electric car industry is still in its infancy. Over time, products that keep the environment in mind might become the wave of the future. Do you think electric cars will be a staple consumer or luxury product in a decade or so? Let us know your thoughts by leaving a comment below!