BEIJING (Reuters) - China’s main state planning body has granted a subsidiary of automotive design contractor CH-Auto permission to build 50,000 electric vehicles per year, the third startup automaker to gain approval under a new licensing system.
The government has employed a raft of policies to promote a switch from petrol-powered to electric cars, including spending billions of dollars in subsidies. It sees the segment as an opportunity to leapfrog global automakers that had a nearly century-long head start in making internal combustion engines.
In response, automakers have moved to broaden their range of green car offerings. On Tuesday, South Korea’s Hyundai Motor Co said it would build nine green models in China by 2020, making up 10 percent of its China sales by that year.
As part of the government’s efforts, the green car segment has been opened up to non-automakers, including technology companies. It began calling on such firms to apply for official approval to make electric cars this year.
Qiantu Auto (Suzhou) became the third company to gain approval under that system, receiving permission for a 2 billion yuan ($300 million) factory project, showed a statement on the National Development and Reform Commission website on Tuesday.
Parent company CH-Auto primarily acts as an engineering and design contractor for automakers but has decided to make cars of its own.
CH-Auto and Qiantu did not respond to requests for comment.
Beijing Electric Vehicle Co, affiliated with state-owned Beijing Automotive Group Co Ltd [BEJINS.UL], was first to gain approval for an electric vehicle project in March. Hangzhou Changjiang Passenger Vehicle Co Ltd received approval in May.
($1 = 6.6685 Chinese yuan)
Reporting by Jake Spring; Editing by Edwina Gibbs and Christopher Cushing