Waste-Truck Maker, Sportscar Startup Said Near China EV Permits

  • CH-Auto, Aoxin’s applications reviewed by panel, people say
  • Only two ventures have obtained approval for new permits

A garbage-truck maker and a sports-car startup are the top candidates to receive permits to manufacture electric vehicles in China as part of the government’s push to encourage innovation in the auto industry, according to people with knowledge of the process.

A panel of experts appointed by the National Development and Reform Committee, which oversees the approval of new investment projects, has concluded its technical review of Jiangsu Aoxin New Energy Automobile Co. and Beijing CH-Auto Technology Co., according to the people, who asked not to be identified because the matter is private. The NDRC may soon announce a decision, which hasn’t been finalized, the people said, without being more specific.

The NDRC said on Monday that it doesn’t comment on applications in process. A representative for CH-Auto declined to comment, while calls to Aoxin’s main line weren’t answered.

Companies that are seeking the special license to produce EVs have to clear the evaluation, which will rate them in terms of their capabilities in research and development and manufacturing. So far, only two firms -- Beijing Electric Vehicle Co. and Hangzhou Changjiang Passenger Vehicle Co. -- have received permission under the program, which was announced in June 2015 to encourage companies outside the auto industry to provide competition to traditional carmakers.

Click here for a look at how most of China’s electric-car startups face a wipeout.

The Ministry of Industry and Information Technology is considering restricting the number of startup EV makers to a maximum of 10, said Dong Yang, an executive vice president at the China Association of Automobile Manufacturers who meets regularly with the industry’s officials. The MIIT didn’t respond to a faxed request for comment.

That will be a blow to the more than 200 companies that are in various stages of working on EV models. Ninety percent of the companies currently developing EV platforms won’t meet the technology standards set by MIIT even in two years, said the Economic Daily, an official newspaper run by the State Council.

Three other companies -- Wanxiang Group Corp., LeEco and WM Motor -- say they plan to apply for the permits, while others are considering engaging existing automakers with excess capacity to contract manufacture for them. Before switching on the assembly lines, however, the successful applicants for the EV license must still receive permission from the industry ministry.

Aoxin, which produces electric-powered garbage trucks and postal vehicles, is owned by the investment arm of Yancheng, a small city in eastern Jiangsu province. The mayor had pledged to help the company obtain the EV manufacturing permit as part of the provincial push to promote the development of the new-energy vehicle industry.

CH-Auto is a Beijing-based automotive design company started by Lu Qun, 48, a former Jeep engineer. The company has set up Qiantu Motor, a brand that bears a dragonfly emblem, with the aim of producing lightweight electric roadsters to compete with Tesla Motors Inc.’s Model S. CH-Auto is building a factory in the eastern Chinese city of Suzhou and plans to introduce the sports car K50 next year.