The Effectiveness of the Fiscal Policies Issued by the Chinese Government on the New Energy Vehicle Industry

Abstract

The development of alternative energy vehicles is a successful way to encourage energy saving and emission reduction. The renewable energy transportation sector is a vital growing industry in China. As energy and environmental issues become more serious today, vigorously developing alternative energy vehicles is an efficient strategy to address these issues. This paper focuses on the impact of China's fiscal policy on the development of alternative energy vehicles. In this study, we inquire about the fiscal policies enacted by the Chinese government for new energy vehicles. The effectiveness of the fiscal policy is reflected by studying and comparing the revenue growth as well as the sales of new energy vehicles under each brand of two different car brands: BYD and NIO. Another aspect of this study is to examine whether the introduction of new energy vehicles by the Chinese government has a negative impact on traditional vehicles by comparing the sales of the two models of GM Wuling.