Kandi Technologies Group Inc. rose to a three-week high after the Chinese specialty automaker said it’s starting retail sales of electric vehicles as the government promotes the use of alternative-energy transportation.
The stock rallied 3.6 percent to $13.24 in New York. Trading volume of 1.1 million shares was 1.5 times the three-month average. A Bloomberg gauge of the most-active U.S.-traded Chinese stocks gained 0.9 percent.
Chinese automakers are adding electric cars to their lineups after the government extended incentives to promote their use as a way to cut emissions and reduce pollution. Total production of electric vehicles surged fourfold in the first quarter from a year earlier, according to the Ministry of Industry and Information Technology.
“People recognize on a daily basis the negative impact of pollution in China,” David Smith, a portfolio manager at Greentech Capital Advisors in New York, said by phone. “The government is starting to take action, and there are incentives in place to push electric vehicles.”
China is supporting electric-vehicle sales through subsidies that can cut retail prices by as much as 60 percent, according to data compiled by Bloomberg Intelligence. Beijing will exempt them from restrictions that prohibit drivers from taking their cars on the road on certain days, according to a government statement posted on the Beijing Daily website.
Ninety percent of air pollution in nine cities, including Beijing, comes from vehicles, industrial production, coal burning and dust, according to Bloomberg New Energy Finance, citing a recent Ministry of Environmental Protection report. Vehicles are the major source of pollution in Beijing, Guangzhou, Shenzhen and Hangzhou, the China Youth Daily reports.
Kandi is selecting dealers in 26 Chinese provinces and will begin selling its latest electric vehicle models, Chairman Hu Xiaoming said in a telephone interview Thursday. It also aims to expand its car-rental network to about 15 cities in China this year, from the eight currently, he said.
Beijing Automotive Group Co., China’s top seller of “pure” electric cars, said last month that it expects to sell over three times more new-energy vehicles in 2015.
Baidu Inc. rose 2.7 percent to $218.48 after a Chinese Hospital Group suspended its advertising boycott on the search-engine operator. The Bloomberg China-US Equity Index advanced to 126.54.
The Deutsche X-trackers Harvest CSI 300 China A-Shares ETF, the largest U.S. exchange-traded fund that tracks mainland Chinese stocks, slipped 2.1 percent to $43.26.
— With assistance by Stephen Stapczynski, and Tian Ying