Ministry of Industry and Information Technology Releases Audit Results of New Energy Vehicle Subsidies

Recently, the Ministry of Industry and Information Technology (MIIT) released a public notice regarding the preliminary audit results of subsidy funds for the promotion and application of new energy vehicles from 2016 to 2020. The notice indicates that, according to the requirements outlined by the Ministry of Finance, MIIT, the Ministry of Science and Technology, and the National Development and Reform Commission, the MIIT Equipment Industry Department commissioned the MIIT Communication Settlement Center to conduct a review of the subsidy funds. Many car manufacturers received significantly lower subsidy amounts than they applied for during the review period, with the highest reduction being approximately 140 million yuan. Notably, BYD (including BYD Auto Co., Ltd., BYD Auto Industry Co., Ltd., and Tianjin BYD Auto Co., Ltd.) is one of the few car manufacturers that received subsidies in all five years. In 2019, BYD applied for a subsidy of 83.035 million yuan for 2,907 vehicles but was granted a subsidy for only 303 vehicles, amounting to approximately 8.11 million yuan, which is a reduction of about 74.925 million yuan compared to the application. Over the five years from 2016 to 2020, BYD's actual subsidy amount decreased by about 140 million yuan compared to what was applied for. Other manufacturers, such as Beijing New Energy Vehicle Co., also experienced similar reductions of approximately 97.04 million yuan. Tesla participated in the new energy vehicle subsidy program for the first time in 2020, applying for subsidies for 538 vehicles with a request for about 11.2 million yuan, all in compliance with policy regulations. The main reasons for the reductions were related to non-compliance with the requirements for vehicle documentation and failure to upload vehicle operation data as required. While the discrepancies between the subsidy applications and actual amounts are largely due to non-compliance with submission materials or data uploads, it does not necessarily indicate 'subsidy fraud.' However, there have been instances of fraudulent behavior in the early stages of the industry, which prompted stricter policy audits to eliminate such practices. According to Zhan Junhao, director of the New Energy Vehicle Technology Research Institute at Jiangxi New Energy Technology Vocational College, the early subsidies helped cultivate market scale, and as the industry enters a growth phase, the reduction of subsidies will enable companies to break free from 'subsidy dependence' and focus on core technological breakthroughs and cost control, shifting the industry from being 'policy-driven' to 'market-driven.'