The Impact of China’s Electric Vehicle Subsidy Policy on the New Energy Automobile Industry—Based on the Research on the 5 Pilot Cities

In order to promote the market penetration of electric vehicles (EV), China launched the Electric Vehicle Subsidy Policy (EVSP) in Jan 2009, followed by the Local government subsidies for EV. In this paper, we focus on the impacts of the EVSP on the market penetration of battery electric vehicles (BEV) and the plug-in hybrid electric vehicles (PHEV).We estimate effect of the EVSP offered by ShangHai, Shenzhen, Guangzhou, HeFei, HangZhou government from 2011 to 2014.We find that the EVSP had a positive effect on the market share of BEV and PHEV. However, the A00 and A0 compact cars were crowded out as a result. On the basis of this, I hope to provide the corresponding countermeasures and suggestions for the government policy makers.