China’s Quest to Adopt Electric Vehicles

The Chinese government’s effort to create an electric vehicle industry is a bold experiment in local and system-level innovation. It also provides a window into understanding the promise and peril of economic development policies, both for China and for the rest of the world.

The Chinese auto industry reached a major milestone in 2009. After a decade of continuous growth, China became the largest car market in the world. In 2012, it also became the world’s largest producer of emissions, in part from the rapid spread of personal cars and gasoline-powered trucks and buses. The Chinese government understood that it had an environmental problem.

China’s twelfth Five-Year Plan (2011–2015)—its core economic and social development roadmap—identified seven strategic...

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1 In 2010, the same four ministries began selecting pilot cities for private sector EV development, including Shenzhen, Hangzhou, and Hefei. Our analysis focuses on EVs in the public sector, as private use of EVs is still in initial stages in China.
2 Government document on the national pilot education reform. (
3 Yao Yiran & Zheng Siyuan, “Many Cities Try Land Exploration Reform: Pilot Experiences may be extended nationally,” Economy & Nation Weekly, issue 20, 2012. (
4 Hu Zhouying, “Electric Vehicles Can Access Battery Charging or Swapping Stations Within Five Kilometers in Hangzhou.” (
5 Ray Jing, “Hangzhou to Lease 20,000 EVs in Two Years,” China Automotive Review, Aug. 8., 2012. (
6 Pan Mingjun, “Ten Cities, Thousand Vehicles: Loser-out Tournament? Middle Evaluation Will be Conducted After the Two Sessions,” Auto Business, Mar. 2, 2012. (
7 Gao Yiran, “Auto Subsidies, Local Government Should Not Play as a Doting Parent,” China Business Times, Sept. 14, 2012. (