Political Factors Of The Chinese Government

1589 Words Apr 9th, 2015 7 Pages
Political Factors
The Chinese government has shown tremendous dedications from 2013 in promoting the adoption of new energy vehicles in the country. In an attempt to reduce power consumption, the State Council imposed a new oil consumption standard for the automakers to diminish the average oil consumption by passenger cars from 7.42 liters to five liters per 100 kilometers by 2020. This will have no effect on full electric automakers, such as Tesla.
Moreover, according to Global Times, the Chinese government continues to support to have at least 500,0000 new energy vehicles and subsidize local new energy vehicles until 2020 to deplete the air pollution emerging from passenger vehicles. In 2010, World Bank recorded China as the world’s carbon dioxide contributor with 8.3 gigatonnes carbon dioxide in that year alone. The Beijing Other policies include reducing and exempting taxes on new energy vehicles and levying emission discharge fees on fossil-fuel vehicles. Apart from that, the central government ordered the local authorities to lift restrictions that limit the number of use of foreign new energy vehicles. All these support will boost Tesla’s business operations in the long term both directly and indirectly.
With the tax reductions and exemptions of new energy vehicles, the price of Tesla’s vehicles in China may decrease significantly and give the consumers incentives to purchase them. In addition, the Shanghai government announced that 3000 Tesla Model S owners will be…
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