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End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

For new energy vehicles, when the state support is no longer, it must learn to walk on its own.

On February 21, the vane of the new energy automobile industry was slightly deflected, and 12 departments such as the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the Ministry of Finance confirmed that in 2022, the preferential policies for the purchase of new energy vehicles, charging facilities awards, and vehicle and vessel tax reductions will continue to be implemented, but the subsidy range will decline by 30% compared with 2021. At the same time, the subsidy policy for the purchase of new energy vehicles will also be terminated within this year, that is to say, vehicles licensed after December 31 will no longer be subsidized.

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

BYD Han EV

This means that the subsidy policy for the purchase of new energy vehicles implemented since 2009 will officially withdraw from the historical stage of new energy vehicles after about 13 years.

What does this mean?

What does this mean for new energy vehicles? To what extent does it determine the market's willingness to buy?

Before the cancellation of the subsidy policy for new energy vehicles this year, the subsidy decline policy has already shown its power. Starting from 2020, the subsidy decline policy will be implemented, that is, from that year, the subsidy amount will be reduced by 10%, 20% and 30% every year, and the subsidy will be reduced by 30% by 2022.

This has led to a collective price increase for new energy vehicle companies this year. The fastest response should be Tesla, the new energy car company in December last year, in just over a week, the Model 3, Model Y some models carried out multiple rounds of price increases, the price increase range of 5,000 yuan to 15,000 yuan.

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

Some Tesla Model 3/Y models have increased prices

Subsequently, another new energy vehicle giant BYD also announced that it would adjust the price of its dynasty network and marine network related new energy models, ranging from 1,000 to 7,000 yuan, which was officially implemented on February 1. At present, on BYD's official website, the price of new energy models has all been increased. Taking Song PLUS DM-i as an example, the starting price of the car when it was launched in March last year was 146,800 yuan, and the current official website price is 149,800 yuan, up 3,000 yuan.

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

Song PLUS DM-i price increase

In the face of the new subsidy policy, some car companies have adopted a time-limited insurance strategy, that is, requiring users to place orders within a certain period of time and enjoy the 2021 subsidy standard. But this is mainly to attract users to place orders, not a long-term solution, these car companies eventually embarked on the road to price increases. For example, one month after the implementation of the time-limited price insurance strategy, Xiaopeng Automobile decided to increase the price of all Xiaopeng models, ranging from 4300 to 5900 yuan.

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

Xiaopeng P7

It should be noted that the collective price increase of new energy vehicle companies is definitely not caused by a single factor, but is driven by a variety of factors. In addition to the impact of the subsidy decline policy, the lack of cores, the high price of raw materials and the increase in the price of power batteries eventually pushed the cost pressure to the terminal market, resulting in a general increase in the price of new energy models.

According to the observation of the smart car party market, the current price increase of new energy vehicles is mostly not more than 10,000 yuan, generally around 4,000 yuan. Even if subject to the subsidy retreat policy, the upper limit of new energy subsidies for electric vehicles with a range of 400 kilometers (unit price of less than 300,000 yuan) is still 12,600 yuan (18,000 yuan in 2021). Since the subsidy is still there, the purchase intention of consumers of new energy models cannot be greatly affected. This is also reflected in sales: China's new energy passenger car retail sales reached 347,000 units in January, up 132% year-on-year (data from the Association).

However, if the subsidy for the purchase of new energy vehicles is completely abolished, the situation may be different. The potential new energy consumption camp may diverge, and some people will tend to buy fuel vehicles or hybrid vehicles. If the purchase tax incentives for new energy vehicles are cancelled (sooner or later, there will be such a day), and the product strength of the new energy models themselves is not greatly improved, this differentiation may be more serious.

The new energy subsidy will be terminated, but the owners of fuel vehicles cannot laugh

Although subsidies for new energy vehicles will become a thing of the past, few people in the potential new energy consumption camp will think of buying a gas truck, because they see that oil prices are soaring, and there is no intention of ending.

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

Fuel gun

After the last round of oil price adjustment, the price of No. 92 gasoline in some areas has approached 8 yuan / liter, swinging between 7.80 yuan / liter and 8 yuan / liter, and it takes about 8 yuan more to fill a tank of oil (50 liters). In the 4th working day of the new round of oil price adjustment, it is currently expected to raise the oil price by 75 yuan / ton, which is converted into an increase of 0.06 yuan / liter - 0.07 yuan / liter, and the oil price is still rising, filling a tank of oil (50 liters) is at least 3 yuan more than the last time.

As of now, during the year, domestic oil prices have shown a "three-consecutive rise". According to the current trend, the "four consecutive rises" are already on the way. If you count the last oil price adjustment last year, domestic oil prices may show "five consecutive rises".

Is it far off to eliminate the purchase tax benefits?

When will the new energy purchase tax incentive be abolished? There was no clear response from the relevant authorities. But since the cancellation of subsidies has become an established fact, isn't the next cancellation of purchase tax incentives?

End of subsidies for new energy vehicles at the end of the year Is it far from abolishing the purchase tax incentives?

Vehicle Purchase Tax (Source Network)

The purchase tax incentive can be said to be the last layer of protective shell added to the new energy vehicle, and it is also the hardest, and the impact of canceling it is comparable to the non-cancellation of the purchase subsidy policy. Once the purchase tax concessions for new energy vehicles are canceled, it means that the owner will spend tens of thousands of yuan to pick up the car, which can completely consume the consumer's enthusiasm for purchase.

Of course, at another level, as the cost of new energy vehicles continues to compress and the product strength continues to increase, new energy vehicles in the future do not need the protection of preferential purchase tax policies to compete head-on with fuel vehicles.

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