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'New-energy' vehicles get a lift from city's incentive program

ENVIRONMENTALLY minded Shanghai motorists will soon get a price break and other incentives under a new city plan designed to promote vehicles that burn less fuel and emit fewer pollutants.

From next year until the end of 2011, the municipal government plans to offer up to a 20 percent one-time subsidy to people who buy "new-technology vehicles" that save 15 percent or more on fuel compared with conventionally powered cars and trucks, the Shanghai Economic and Information Technology Development Commission said yesterday, acting on a proposal from the Shanghai People's Congress.

Buyers of hybrids, all-electric or fuel-cell vehicles will also get a break on some road taxes. Other promotional measures include easier registration and an increase in battery-charging infrastructure.

The maximum compensation for a passenger car will be 20,000 yuan (US$2,923), and the limit for commercial vehicles will be 400,000 yuan. Gas-electric hybrid cars now can cost more than 250,000 yuan.

"New-energy vehicles are expected to be mass produced in Shanghai over the next few years, and the most urgent question is how to gain market acceptance and boost sales," the economic commission said.

"Shanghai is determined to accelerate the development and take the lead in the industrialization of new energy vehicles and achieve competitiveness in the international market."

Shanghai is among the first batch of 13 Chinese cities to offer subsidies to encourage the use and manufacture of "green" vehicles to help improve the environment and save energy.

City government has encouraged SAIC Motor Corp, the nation's biggest car maker and the city's auto powerhouse, to make new-energy vehicles its key business. It is also urging the public service sector, including transport, taxis, the post office and sanitation, to become pioneers in fuel-efficient, alternative vehicles.

By 2011, Shanghai aims for new-energy vehicles to account for 5 percent of its total vehicle output, with an industrial scale of 10 billion yuan and a fleet of more than 10,000 vehicles in trial operation.

Another 3 billion yuan will be allocated within three years to invest in programs for the industrialization of these vehicles.

After several years of development, several new-energy vehicles are already running on the streets, including a hybrid version of the Buick Lacrosse made by a venture between SAIC and General Motors. SAIC earlier said a hybrid for its self-owned Roewe brand will be launched at the end of 2010. A fleet of 10 battery-powered buses is now conducting trial operations in public transportation.

Xiao Yang, the People's Congress representative who submitted the proposal, said some car makers place too much attention on sales and lack investment for advanced technologies and developing self-owned vehicles.

"Anyone who comes up with the commercialization of new-energy vehicles will take the lead in future development," he said, adding that the government should play a leading role in building facilities to support the sector.


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