China electric vehicles to hit 1 million by 2020: report

A BYD F3DM (Dual Mode) hybrid electric car is seen outside its headquarters in China's southern city of Shenzhen February 23, 2010.

BEIJING (Reuters) - China's output of electric vehicles is expected to reach 1 million units by 2020, the official Xinhua news agency said on Saturday, citing a senior government official.

Green vehicles are key for the development of China's auto industry as auto exhaust emissions already account for 70 percent of the country's air pollution in major Chinese cities, Wan Gang, Minister of Science and Technology, was quoted as saying.

Wan did not project the country's overall vehicle output by 2020.

Vehicle sales in China, now the world's biggest auto market is expected to top 17 million units this year, Dong Yang, secretary general of the country's official industry association, has said.

Beijing launched a pilot programme in June to hand out rebates to electric and hybrid car buyers as its stepped up its efforts to cut emissions. Maximum subsidies for electric car buyers is 60,000 yuan ($9,036).

It is also subsidizing fleet operators in 25 cities to promote the use of clean energy models in the country's public transportation system.

Over the next 10 year, the Chinese government will spend more than 100 billion yuan to subsidize its fledgling green vehicle industry, state media said, citing a draft plan, which will be released later this year or early 2011.

Wan added that an estimated 8.5 billion yuan has been channeled into the green car industry from the capital market so far. The fund would help build up the country's battery output, which will be capable of supplying 150,000 electric vehicles by October 2011.

"That would be a big step for the electric vehicle industry," Wan was quoted as saying.

($1=6.640 Yuan)

(Reporting by Fang Yan and Jacqueline Wong)