Beijing’s New Target for Green Vehicles

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July 14 (Bloomberg) –- Bloomberg’s David Ingles reports on China’s government mandating that at least 30% of government vehicles must use alternative energy by 2016. He speaks to Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

Weapon in its battle against pollution.

This time it is about cars, particularly the huge fleet of government cars.

David, get on in here and bring us up to speed.

What happens with any other government, the chinese government buys up a whole fleet of cars, whether it is for official use in the central government or local government units.

There is a marching order that at least 30%, at least a third of what you buy, has to be cars that use alternative energy.

That is by 2016. we are looking at plug-in hybrids, electric cars, hybrids and fuel cell vehicles.

That is the target two years from now.

This year, we there's already a target.

Beijing in that area, the target is 15%. what you're looking at on your screens is a minimum percentage of cars the government bought.

All cities outside the big cities.

It gradually goes up to 20%. 3% after 2016. they did not specify what the ultimate goal was.

Why are you doing this?

Obviously because of record air pollution measurements.

When we start talking about the coal plants especially in the winter, it happens.

Why are they doing this energy efficiency?

They want to reduce the dependence on the outside.

Keep in mind, china is also a net importer of oil.

That is right.

Is going to really be critical.

That is just government cars.

It is a private vehicle -- it is the private vehicles that are the biggest contributor to smog.

What are the incentives for the average chinese driver?

That is a good point.

You could argue that for the government they can issue a marching order for consumers.

They have to put in place a lot of incentives.

We have talked about subsidies for the development of not only the electric cars but also the batteries, the hybrids, the lithium batteries for example.

As far as demand is concerned, they pledged to offer subsidies for cars up to 29,000 u.s. dollars.

There's a plan of phasing out subsidies as well.

What they're doing is instead of sticking to plan, they are slowing down the reduction of the subsidies.

It was only supposed to be 10% this year.

20% next year and it is 10% now.

Just last week we were talking about it.

If you want to buy an alternative energy car in china between september 1 until the end of 2017, you are now exempt from paying the sales tax.

The 10% sales tax on top of the price.

It is a bit knock off the price.

You need the charging stations

This text has been automatically generated. It may not be 100% accurate.

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