Nio, the darling of China’s electric vehicle (EV) industry, appeared to teeter on the edge of bankruptcy for months. With no major investments, the company was set for disaster as global markets began melting down over Covid-19. But Nio turned out to have an ace in its pocket: the government.
The company is not alone. China’s government is fighting an uphill battle to keep its electric vehicle (EV) industry afloat. But authorities are now pulling back from an effort to wean the sector from state support.
EV sales in China have plunged after the central government cut subsidies by up to 50% in June. The impact of these cuts was swift and severe. Sales of new energy vehicles (NEVs) dropped by 7% year on year to 8,000 cars in July following growth of 80% in June, marking the first fall in more than two years.
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