China Phases Out EV Subsidies as Market Matures, Shifts Focus to Global Expansion
China will phase out electric vehicle subsidies in its 2026-2030 five-year plan, marking the first withdrawal of such support in over a decade. The MOVE reflects Beijing's assessment that domestic EV and battery manufacturers no longer require policy prioritization, having already achieved global dominance. Dan Wang of Eurasia Group notes the market will now determine winners and losers in an industry where 93 of 169 automakers hold less than 0.1% market share.
The subsidy withdrawal comes amid severe domestic oversupply, with Chinese EV makers aggressively expanding into international markets to offset brutal price wars at home. While authorities have attempted to curb cutthroat competition through anti-innovation campaigns, automakers continue finding loopholes—offering free upgrades and budget models instead of direct price cuts.
