Shanghai to offer subsidies for fuel-saving vehicles

Shanghai, China - The municipal government of Shanghai, China plans to offer subsidies for "new-technology vehicles" that save 15 per cent or more on fuel compared with conventional cars and trucks, according to the Green Car Congress. The subsidies, up to 20 per cent of the purchase price, will be available in 2010 and 2011.

The program will also give some road tax breaks to purchasers of hybrids, all-electric or fuel-cell vehicles, and include promotions such as easier registration and an increase in battery-charging infrastructure.

Passenger car subsidies will have a maximum of 20,000 yuan (approximately US$2,923), while commercial vehicles will have a subsidy of 400,000 yuan. Gasoline-electric hybrid vehicles currently cost more than 250,000 yuan. Shanghai is among the first of 13 Chinese cities that will offer subsidies to encourage the manufacture and purchase of new-technology vehicles.

The city government has encouraged SAIC Motor Corporation, the country's largest car manufacturer, to make new-technology vehicles its key business, and is urging the public service sector to become pioneers in alternative vehicles. SAIC currently sells a hybrid version of the Buick LaCrosse, produced by a venture of SAIC and General Motors.