How can the new energy vehicle industry achieve stable and sustainable development

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Recently, with the production of a pure electric sedan from the assembly line, the cumulative production of new energy vehicles in China has exceeded 20 million units. Experts believe that this marks a new milestone for China's new energy vehicle industry, as it transitions from industrialization and marketization to a high-quality phase of large-scale and global development.

Currently and in the near future, what opportunities and challenges does China's new energy vehicle industry face? How to promote the steady and sustainable development of the new energy vehicle industry?

In the first half of the year, production and sales increased by 42.4% and 44.1% year on year.

New energy vehicles are the main direction for the transformation and upgrading of the global automobile industry and the green development, as well as a strategic choice for the high-quality development of China's automobile industry. According to the latest data from the China Association of Automobile Manufacturers, in the first half of this year, China's production and sales of new energy vehicles reached 3.788 million and 3.747 million units respectively, an increase of 42.4% and 44.1% year on year. The sales of new energy vehicles accounted for 28.3% of the total sales of new vehicles.

Vice Minister of Industry and Information Technology Xin Guobin introduced that since the 18th National Congress of the Communist Party of China, China has taken the lead in establishing a national strategy for the development of new energy vehicles, successively formulated industrial development plans for 2020 and 2035, and approved by the State Council to establish top-level design and promotion mechanisms for industrial development. More than 70 policy measures to support the development of the new energy vehicle industry have been introduced by various departments, and local governments have issued supporting policies based on their own actual conditions. Industry enterprises have accelerated their pace of innovation, jointly promoting the historic achievements in the development of China's new energy vehicle industry.

"After unremitting efforts, China has established a complete and synergistic new energy vehicle industry system, cultivated the world's largest consumer market, and formed a good development situation of mutual integration and win-win cooperation between new energy vehicles and related industries," said Xin Guobin.

Fu Bingfeng, Executive Vice Chairman and Secretary-General of the China Association of Automobile Manufacturers, introduced that in September 2020, China's cumulative production of new energy vehicles exceeded 5 million units, and in February 2022, it exceeded 10 million units. To achieve the second 10 million units, it took only 1 year and 5 months.

At the same time, the competitiveness of China's new energy vehicle brands has greatly improved. According to statistics, in 2022, the market share of domestic sales of new energy passenger cars by domestic brands reached 79.9%, an increase of 5.4 percentage points year on year. In the first half of this year, exports of new energy vehicles reached 534,000 units, an increase of 1.6 times year on year.

Ouyang Minggao, National Committee member of the Chinese People's Political Consultative Conference, academician of the Chinese Academy of Sciences, and professor at Tsinghua University, said that after nearly a decade of rapid development, China's new energy vehicle and power battery industries have led the world, with production and ownership ranking first globally, and achieving large-scale exports, becoming a major highlight of China's economy.

Competitive advantages are gradually established in the field of "Three Electrics" technology

Technological innovation is the core competitiveness of industrial development.

In recent years, China's core technology for new energy vehicles has continued to break through. For example, the energy density of mass-produced power battery cells has reached 300 watt-hours/kg, which is at the international leading level, and breakthroughs have been made in the application of new grouping technology and high-nickel cobalt-free batteries; the peak power density of the driving motor exceeds 4.8 kilowatts/kg, and the maximum speed reaches 16,000 revolutions per minute; the average electricity consumption of pure electric passenger vehicles per 100 kilometers has dropped to 12.35 kilowatt-hours.

"China has gradually established a competitive advantage in the 'three-electric' (battery, motor, and electronic control) technology field," said Fu Bingfeng. Recently, policies have been intensively introduced to stimulate consumption potential and strengthen the development of industrial supporting capabilities, which will further stabilize market expectations and promote high-quality development of the industry.

However, it should be noted that China's new energy vehicle industry still faces challenges such as insufficient supply of key core technologies and the need to improve support and guarantee capabilities.

"Establishing a collaborative approach across multiple domains such as automotive chips, application software, and operating systems is key to industry transformation and upgrading," said Li Shaohua, Deputy Secretary-General of the China Association of Automobile Manufacturers. Main manufacturers, software companies, research institutions, and others need to jointly build and share common technology platforms to enhance the stability and competitiveness of the supply chain.

Xin Guobin pointed out that the Ministry of Industry and Information Technology will support Chinese companies to collaborate with companies from other countries in areas such as new-generation batteries and autonomous driving to enhance brand vitality through technological innovation. Enterprises should promote a product life-cycle service concept, strengthen digital and networked capacity building, and improve brand affinity through high-quality services.

In addition, experts believe that China's new energy vehicle industry still relies on imports for materials such as lithium, nickel, and cobalt. While the industry is experiencing rapid development, it needs to be cautious about risks such as overcapacity and structural contradictions. A long-term perspective is needed to address weaknesses and maintain a healthy industry order to ensure steady and far-reaching development.

Further efforts are required to construct a high-quality charging infrastructure system.

"This year during the Dragon Boat Festival holiday, my family and I went on a self-driving trip. While charging at the service area on the highway, we encountered long waiting times due to limited charging stations, low charging power, and long charging duration, which greatly affected our travel experience," said Wang Yongtao, a new energy vehicle owner living in Beijing's Daxing District.

Currently, with the increasing demand for long-distance travel in new energy vehicles, highway service areas have become essential charging scenes.

Wang Zhongying, director of the Energy Research Institute of the National Development and Reform Commission, introduced that as of the end of May this year, China has provided charging facilities at 4,289 highway service areas, accounting for about 65% of the total service areas. However, statistics show that the total number of charging facilities on highways is about 18,000, accounting for only 0.8% of the total public charging infrastructure in China. The insufficient quantity, low density, and inadequate coverage of charging infrastructure remain prominent issues compared to development needs.

Apart from the "difficulty in charging on highways," there are also significant challenges of "finding charging stations" and "entering residential areas" raised by current new energy vehicle users.

Wang Yao, Secretary-General of the China Electric Vehicle Charging Infrastructure Promotion Alliance, mentioned that in older residential areas, it is difficult to allocate private charging piles due to limited parking spaces and inadequate power capacity. Additionally, some residential areas face obstacles from property management in providing the necessary documentation, making it impossible for users to install private charging piles. Moreover, issues such as difficulty in locating public charging stations, high failure rates of charging piles, and charging spaces being occupied are particularly prominent.

In the long term, the development of the new energy vehicle industry relies on a high-quality charging infrastructure system. "As of the end of 2022, China's cumulative domestic electric vehicle charging pile-to-car ratio is 2.5∶1," said Ouyang Minggao. It is expected that China's new energy vehicle ownership will continue to grow rapidly, and therefore, the development of charging infrastructure must be accelerated.

Recently, the State Council's General Office issued the "Guiding Opinions on Further Building a High-Quality Charging Infrastructure System," which clearly sets out five tasks: optimizing and improving network layout, accelerating construction in key areas, enhancing operation and service levels, strengthening technological innovation leadership, and increasing support and guarantee efforts.

Regarding this, Ouyang Hong, Deputy Secretary-General of the National Development and Reform Commission, stated that the National Development and Reform Commission and the National Energy Administration will strengthen coordination among relevant departments, provide guidance and supervision to all regions, and ensure that various measures take effect as soon as possible. (Reported by Liu Kun, Guangming Daily)."