How New Energy Subsidies Can Stay for Long-term Savings

In 2017, the production and sales of new energy vehicles in China reached 774,000 vehicles and 777,000 vehicles respectively. The rapid development of the new energy auto industry will undoubtedly require the support of the country’s new energy policy. However, the financial subsidies for new energy vehicles are gradually tightening. For the new energy automotive industry, every move of subsidies will have a huge impact on the layout and planning of car companies. So how can a car company survive for long?

Subsidy accelerates downward slopes Market enters enterprise-led stage

The rapid development of China's new energy auto industry can not be separated from the policy's strong support, but relying on policies is not an ideal solution for sustainable development. With the industry gradually on the right track, the subsidy policy is gradually declining. According to the new regulations on subsidy policies, all subsidy policies will be withdrawn after 2020, and the Ministry of Industry and Information Technology has also established a new energy auto points trading system as an alternative measure.

The electric vehicle resource network learned that on June 12th, the New Energy Automobile Financial Supplementary New Deal was formally implemented in 2018, the subsidy standard was further subdivided, the subsidy of vehicles with low cruising range was reduced, the mileage was low, and the energy density of the power battery was high. The subsidy for vehicles with low power consumption was improved, but the subsidy for plug-in hybrid vehicles, new energy vehicles, and new energy buses fell compared to 2017. Therefore, the subsidies for new energy vehicles are falling as a whole. The acceleration of the subsidy policy, which means that the government's market-dominating model is about to end, and the new phase of the corporate-led market is already open.

Recommended list needs to be re-reported

The electric vehicle resource network learned that when the Ministry of Industry and Information Technology released the "Catalogue of Recommended Vehicles for Promotion and Application of New Energy Vehicles" (6th batch of 2018), it also explicitly stated that it was in accordance with the "Notice on Adjusting and Perfecting the Policies for the Promotion and Application of Financial Subsidies for New Energy Vehicles" ( Caijian [2018] No. 18) requested that from June 12, 2018, the 1st batch of 2017 and the 1-4th batch of “Recommended Vehicle Models for Popularization and Application of New Energy Vehicles” in the 1st batch of 2018 were abolished. Therefore, in addition to the newly released 5th and 6th batches of recommended catalogs, the models that were previously retired on the recommended list must be re-submitted according to the new technical standards. For car companies, re-reporting requires a certain period of time, or will further postpone the subsidy time. The financial pressure on companies to further increase, but also means that its sales pressure can not be ignored. In the case of further improvement of the entry barrier of the Recommended Catalogue, companies should focus more on R&D of new energy vehicles and help the country to further improve its industrial policies and inspection mechanisms.

Self-hematopoiesis is the long-term strategy

The electric vehicle resource network believes that if an industry wants sustainable and healthy development, relying solely on policy support for passive blood transfusion will not work. It is also necessary for enterprises to learn to self-bloom. So how do you make blood? The company can only improve technology, reduce costs, create quality products, and provide customers with a good service experience, in order to get rid of the impact of subsidy withdrawal, and achieve self-blood making.

In terms of cost control, power batteries, as the "heart" of new energy vehicles, account for a large part of the cost. Cui Dongshu once said that “the cost of batteries and raw materials is high, mainly because the upstream costs are too high. These upstream companies are also speculating on subsidies for retreat. The state should take measures to curb such behavior and conduct effective supervision. "To reduce the manufacturing cost of new energy vehicles, the primary goal is to power the battery. Only if its cost is reduced, can the vehicle cost be controlled. At present, an effective path for reducing the cost of power battery companies is to realize the scale and standardization of production.

In terms of technology and products, the current acceleration of subsidies and the withdrawal of new energy subsidies in 2020 will allow companies to gain a solid footing in the fierce market competition as long as they have advanced technology and can produce high-quality products. With technology and products, it is the fundamental guarantee that companies can continuously make blood for themselves. Therefore, car companies should increase investment in R&D of technology and products, and enhance the strength of their cars.

In terms of services, car companies must learn to listen to the market and understand customer needs. As the market is constantly changing, the needs of customers are changing at any time. Enterprises must be rooted in the market and customers, to find out the changes in their needs and accurate grasp, in order to provide targeted customers the most appropriate service.

After the subsidy gradually degrades, the ability of enterprises to control costs will directly affect corporate profits, and profits are the key factors supporting enterprises to survive. The core of competition in the new energy automotive industry is technology, products and services. Under this premise, if a company wants to survive for a long time in the event of accelerated subsidies, it must increase investment in several aspects such as cost control, technological upgrading, product development, and service quality, and actively explore suitable enterprises. Hematopoietic good strategy.