China to Boost NEV Use in Government Departments

China EV

In an effort to accelerate its energy transition and meet ambitious decarbonisation goals, China has mandated a significant increase in the use of new energy vehicles (NEVs) across government departments. This move aligns with the country's broader strategy to reduce its carbon footprint and transition to cleaner, more sustainable transportation options.

NEV Purchase Requirements for Government Departments

The Ministry of Finance has issued new guidelines stipulating that at least 30% of all new cars purchased by government departments in 2025 must be NEVs, which include battery electric vehicles (EVs), plug-in hybrid electric vehicles (PHEVs), and fuel cell vehicles (FCVs).

For government cars with confidential communication systems, typically used on fixed routes and within urban areas, the mandate is even stricter, with a requirement for 100% of these vehicles to be NEVs. Additionally, departments are now encouraged to prioritize renting NEVs when acquiring vehicles for official use.

By the end of 2022, China had approximately 5 million government-owned cars, and this new initiative will have a substantial impact on the overall market share of NEVs in the country’s public sector.

A Major Step in China’s NEV Transition

China has been a global leader in NEV adoption, with sales of electric vehicles surging over the past decade. In 2024, the country is expected to sell nearly 12 million NEVs, marking a 20% increase over 2023. The government’s latest directive further solidifies its role as a major player in the global electric vehicle (EV) market.

China’s policy of incentivizing NEV adoption, along with its ambitious decarbonisation targets, is expected to support continued growth in the sector. The push for government departments to transition to NEVs is not only a step toward meeting environmental goals but also a demonstration of the country's commitment to advancing green technologies.

Market participants predict that the Chinese government will continue to implement supportive policies in the coming years to boost domestic demand for NEVs and navigate the growing geopolitical pressure from other nations.