In major switch, China to encourage sales of conventional hybrids

In a major shift, China will offer incentives to automakers to produce conventional hybrid-powered cars -- such as the Toyota Prius -- as well as plug-in hybrids and battery electric vehicles.

The government wants one in four vehicles to be a conventional hybrid that runs on gasoline and electricity by 2030, according to comments by Ouyang Minggao, leader of a commission that is setting sales targets for so-called green vehicles.

By 2020, conventional hybrids should generate 8 percent of light-vehicle sales, rising to 20 percent by 2025, according to the Technology Roadmap for Energy Saving and New Energy Vehicles.

That document was drafted for the Ministry of Industry and Information Technology.

The targets represent a significant shift from previous policies that excluded conventional hybrids from the government's generous sales subsidies. 

'Clear target'
That policy penalized automakers such as Toyota, which argued that Prius-style hybrids -- which do not require overnight recharging -- would be more widely accepted by consumers.

"This is the first time we set a clear target for developing nonplugin hybrid technology," said Wang Hewu, an associate professor at the department of automotive engineering of Tsinghua University, who was involved in drafting the road map. "The government has always been emphasizing the importance of developing energy-saving vehicles."

China requires automakers to lower the average fuel consumption of their vehicles to 5 liters per 100 kilometers (47 mpg) by 2020 from the current 6.9 liters (34 mpg). 

The government also has targeted a tenfold increase in electric vehicle sales by 2025.

Conventional hybrid support
While many local automakers have developed pure electric vehicles and plug-in hybrids, manufacturers such as Zhejiang Geely Holding Group Co. and Hunan Corun have been lobbying the government to support development of conventional hybrids.

As a member of the National People's Congress, Hunan Corun Chairman Zhong Faping has argued that Beijing should treat conventional hybrids equally with plug-ins.

Hunan Corun supplies batteries for Toyota's Chinese-built hybrids.

"Government is shifting to include energy-saving vehicles such as nonplug-in hybrid in the auto industry development strategy and setting a clear road map for growth of such vehicles," said Cui Dongshu, secretary general of Passenger Car Association. "It's a breakthrough and it will provide guidance for automakers' development going forward."