For China's new energy vehicle (NEV) industry, growth rates are expected to remain high for the foreseeable future.

In the next five years, China's new energy vehicle sales will grow at an average annual rate of more than 40 percent, Fu Bingfeng, executive vice chairman and secretary-general of the China Association of Automobile Manufacturers (CAAM), said at the 11th China Automotive Forum on Friday.

He predicted that in the next five to eight years, China will gradually phase out and replace about 200 million vehicles with exhaust emissions that meet only "China IV" standards and below, giving the electric vehicle market huge space.

Judging from the current performance of the fast-growing new energy vehicle market, and driven by carbon neutrality and carbon peak targets, the government will accelerate the promotion of new energy vehicles, he said.

As a result, Fu expects China's new energy vehicle production and sales growth to remain above 40 percent over the next five years, and for new energy vehicle sales to exceed 20 percent of all new vehicle sales by 2025, or reach even higher levels.

Chen Shihua, deputy secretary-general of the CAAM, said last month that China's auto sales are expected to reach 26.3 million units this year, up 4.0 percent year-on-year. Among them, there will be 1.8 million new energy vehicles, up 40% year-on-year.

In February, the China Passenger Car Association (CPCA) predicted that wholesale sales of new energy vehicles in China would reach 2 million units this year.

In April, the CPCA raised that forecast to 2.2 million units.

Earlier this month, the CPCA raised its forecast for new energy passenger car sales to 2.4 million units this year, saying this is the combined result of strength across all market segments and incremental exports.

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China's NEV sales expected to grow at annual rate of over 40% in next five years-CnEVPost