The secretary-general of the CPCA said that with the supply of chips still uncertain in 2022, traditional carmakers will prioritize their limited resources for NEV models.

(Image credit: CnEVPost)

The adoption rate of new energy vehicles (NEVs) in China continues to grow rapidly as a large number of new electric vehicles enter the market and supportive policies continue.

China's NEV penetration rate, or their share of all new vehicle sales, is expected to exceed 15 percent for this year, and next year the rate is expected to exceed 20 percent, Cui Dongshu, secretary-general of the China Passenger Car Association (CPCA), said in an article published Tuesday.

That's an upward revision from his previous forecast, in which Cui predicted in an early August article that China's NEV penetration was expected to reach 13 percent this year and exceed 25 percent by 2025.

China's explosive growth in new energy passenger vehicles in 2021 saw NEV penetration reach 20 percent in September, Cui noted.

By 2022 if small cars can still maintain high growth, the launch of new PHEVs from local companies will drive overall NEV penetration above 20 percent, reaching China's national target ahead of schedule, Cui said.

According to China's New Energy Vehicle Industry Development Plan (2021-2035) released last year, the country aims to achieve NEV penetration of 20 percent by 2025.

Current policies, products and industry patterns in China are all favorable for the development of the NEV market, and replenishment of energy for these models in cities is no longer an issue, according to Cui.

Chinese regulators are also in good communication about the problems encountered with electric vehicles for long-distance travel, Cui said.

With chip supply still uncertain in 2022, the benefits NEV models can bring to car companies in terms of regulatory points as well as subsidies make them more inclined to prioritize their limited chip resources for these models, Cui said.

Cui's expectations for next year's upwardly revised NEV penetration are in line with previous expectations by William Li, founder, chairman and CEO of NIO.

At the 2021 World New Energy Vehicle Congress in Hainan Province, southern China, on September 16, Li said China's NEV penetration rate could reach 20 percent by next year.

Li believes that the national plan for the NEV industry is prudent in its goals, and from the perspective of NEV promotion, once users accept it, it will become popular very quickly.

NIO's William Li expects China's NEV penetration rate to reach 20% next year