On May 19, 2009, Chinese Premier WEN Jiabao hosted a regular meeting of the state council and hammered out new incentives for vehicle replacement. According to a new plan, the central government will raise the subsidies from the previous planned RMB 1 billion (about USD 146.520 million) to the current RMB 5 billion (about USD 732.601 million) to encourage truck and bus owners to replace their old or heavily polluting vehicles with more greener ones.

At the meeting, it was agreed that the campaign “Vehicle Going to Rural Area” initiated by the central government early this year has already generated a significant impact on boosting rural consumption and stabilizing the overall economic development. To further expand domestic consumption, the government finds it is necessary to offer further incentives to heavy-duty vehicle owners or operators (public transport companies and logistic companies) as part of efforts to build an energy efficient and environmentally friendly economy. 
 

Based on the current subsidizing policy, the central government will further strengthen its financial supports to help truck and bus owners and operators to replace their old vehicles with new ones. Nine provinces and municipalities, including Beijing, Shanghai, Jiangsu, Shandong, Zhejiang, etc. have already been chosen to implement the policy on a trial basis. Truck and bus owners and operators will be offered varied amount of subsidies if their vehicles have been serving for a certain number of years or they cannot meet the national emission standards.

HE Qifeng, a researcher with GreatWall Securities, believes that the new policy will further help the recovery of China’s economy in later half of 2009 and speed up the replacement of heavily polluting vehicles. 

Source : english.chinabuses.com

Editor : Mark

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Tags: Govt Subsidize Vehicle policy