Xi Jinping Calls for Accelerating Construction of Charging Infrastructure to Support Development of New Energy Vehicles
In a move that injected positive factors into the development of China’s automobile industry, Xi Jinping, General Secretary of the Communist Party of China, recently called for accelerating the construction of a charging infrastructure network system to support the rapid development of new energy vehicles. This is the second time in a week that Xi Jinping has shown support for the automotive sector.
Chinese Prime Minister Li Qiang also joined in, calling for the active replacement of old consumer goods such as automobiles with new ones to create a scale effect of replacement. This push towards new energy vehicles and the replacement of old goods has had a positive impact on the Hong Kong auto stocks, with companies like Xpeng Motors and NIO seeing a rise in their stocks on Friday.
Scholars have analyzed that China’s top leaders are encouraging automobile consumption to achieve stable economic growth in the short term. However, the long-term strategy also includes increasing investment in infrastructure and promoting new energy vehicles to reach rural areas.
Xi Jinping highlighted the importance of building a new energy infrastructure network and accelerating the construction of charging infrastructure during a recent collective study session. He emphasized the need to cultivate energy technology and related industries to drive China’s industrial upgrading and promote new quality productivity.
Despite the positive news, China’s auto sales have faced challenges. New energy vehicle sales fell by 30% month-on-month in January, and U.S. President Biden’s announcement of an investigation into national security risks posed by Chinese electric vehicles may affect Chinese automobile exports to the United States.
In response to these challenges, Xi Jinping and Li Qiang have been actively promoting the trade-in of old consumer goods for new ones to boost domestic automobile sales in China. This strategy aims to expand domestic demand and drive economic growth.
Yao Shujie, an economics professor, highlighted the importance of new energy vehicles and intelligent connected vehicles as emerging strategic industries in China’s efforts to create new productive forces. He also emphasized the need for increased investment in technological innovation to improve the profitability of Chinese automobile companies.
As China continues to face economic challenges, Xi Jinping has called for intensifying macroeconomic control and strengthening domestic demand to improve economic vitality. Economists expect China’s weak economic growth momentum to continue into March, with a slower growth rate forecasted for the first quarter.
Yao Shujie suggested that China should consider increasing its fiscal deficit and investing in social services to boost consumer demand and prevent the economy from falling into deflation. These measures could help support China’s long-term economic development and stability.