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China is banning all fossil fuel vehicles

The world’s largest automobile market has announced plans to ditch fossil fuels entirely and is working on a timetable for the same right now

After European countries like the UK and France, China has announced a plan to ban the sale and production of all fossil-fuel powered vehicles – with a timetable for the same being worked on right now by the government. Even though China is not the first country to announce a potential ban on fossil fuel powered vehicles, due to the sheer size of the market in China, a move like this could push the entire world headfirst in a race to capture China’s growing EV market. Additionally, this move comes at a time when almost all major cities in China are struggling with crippling air pollution.

The Chinese EV market

China is the largest automobile market in the world with about 290 million vehicles on the road as of 2016. But even without this number, what makes China an ideal place for such a ban to be implemented is the strong local EV manufacturing industry. According to the China Passenger Car Association, BYD Co. Ltd, China’s biggest EV manufacturer right now, has sold 46,855 electric and hybrid vehicles this year, with Beijing Electric Vehicle (the EV division of BAIC Motors, a state owned automobile manufacturer) following close suit at 36,084 units.

BYD E6 - the company's all electric car
BYD E6 – the company’s all electric car

In comparison, international companies are not doing so well in China. General Motors has sold a mere 738 cars in the country since its debut of the Velite 5 hybrid model at the Shanghai Auto Show earlier this year in April. If you’re interested in the proportion – that’s less than 0.04 percent of its total vehicles sold in the country in the same period.

Chinese customers account for more than half of the world’s electric vehicle purchases, with more than 400k EVs being sold around the world in 2016. In a mandatory move to electric vehicles, China could actually push all major automobile manufacturers with a stake in China towards ramping up their EV production around the world to catch up.

Economic logic

China’s decision makes sense not only from an environmental perspective but from an economic point of view as well. First of all, a better working environment in cities would have innumerable benefits on work-life in the cities.

Solving air pollution could immediately solve a number of economic problems for China
Solving air pollution could immediately solve a number of economic problems for China

Additionally, focussing on electric vehicles would reduce China’s dependence on oil imports, a crucial segment that China has to rely on other countries for as of now.

Other bans around the world

Earlier this year, UK had announced a plan to ban all fossil fuel powered vehicles by 2040. This announcement came hot on the heels of a similar announcement by France. Elsewhere, Netherlands and Norway have taken up a more aggressive deadline of 2025. Even California saw a proposal from Senate President Pro Tem Kevin de León earlier this year to phase out the use of fossil fuels entirely in the state.

Bans or not, the industry is being pushed towards an all-electric market as well. And as a result of that, automakers have also announced similar decisions to go mainly or all electric. Volvo had announced plans to make only electric or electric-hybrids by 2019. While Aston Martin announced its plans to go completely hybrid by 2025, Jaguar Land Rover will be going all in with plans to go all electric by 2020.

Arnab Mukherjee

Arnab Mukherjee