The Ministry of Industry and Information Technology says China’s electric vehicle makers are too many and the government will push for consolidation to strengthen business.
“The number of new energy vehicle makers are too large, and this industry is full of small players and fragmented,” said Xiao Yaqing, the Minister of Industry and Information Technology as compiled from MarketWatch,Monday (13/09/2021).
Government Expects Electric Car Makers to Merge
Xiao Yaqing added that the Chinese government will encourage electric car makers to merge and restructure as the industry requires more investment in advanced technology.
According to a Xinhua News Agency report in 2019, there were 635 companies producing new energy vehicles including electric cars. But only 80 companies issued cars by the end of that year.
Electric vehicles have become a pillar of China’s car market growth, as well as pursuing the goal of reducing carbon emissions. According to data from the China Passenger Car Association, in the first eight months of 2021, it more than tripled to 1.48 million vehicles.
Xiao Yaqing said the global shortage of semiconductors is likely to last longer and will continue to pose challenges for China’s auto industry.
The Chinese government will work to address the problem by finding alternative solutions, supporting chipmakers in expanding capacity and cooperating with foreign suppliers.
Last week, China’s main market watchdog fined three auto-chip dealers for raising prices and vowed to crack down on illegal practices such as hoarding and price gouging.