China and electric vehicles: six things to know

In China, more electric vehicles are being built and sold than ever. But why is that, how is the industry developing, and what has government policy got to do with it? These six factors explain.

by Michael Baldinger, Head of Sustainable and Impact Investing 30 May 2019

#1 Auto emissions are a major contributor to air pollution

China has many cities where air pollution exceeds officially-designated 'safe' levels. As China urbanizes, air quality is becoming an increasingly sensitive issue and one the Chinese government is growing concerned about.

#2 And the human cost from poor air quality is huge

Researchers have estimated that air pollution in China is both directly and indirectly responsible for millions of deaths per year.

#3 So China is pushing investment into the electric vehicle sector

As well as attacking air pollution by boosting the supply of EVs, China is looking to leap ahead of other countries by developing capacity and controlling supply chains for the industry.

#4 And using active policies to guide demand

On the demand side, generous subsidies for EV buyers, high fees for new petrol car licenses and aggressive plans for charging infrastructure are three parts of a detailed policy package.

#5 Which are propelling China's electric vehicle market

1.1 million electric cars were sold in China in 2018, making China the largest market in the world, 3x greater than the US and 20x greater than the UK⁹.

#6 Putting China on course to lead the global electric vehicle industry by 2030

The forces driving China's electric vehicle market and industry are profound and they demonstrate not only how significant the sector is becoming, but also how China is leading the world in terms of climate-friendly policies.

Ultimately, we believe this makes China a key space to watch and a likely source of innovative and investible ideas in the sustainable investing field.

Read more

Sustainable and Impact Investing

Redefining the way you think about sustainable investing

UBS Asset Management in the United States

The website contains general information about UBS Asset Management (Americas), Inc., UBS Hedge Fund Solutions LLC, and UBS O'Connor LLC, collectively known as "UBS Asset Management". The information contained on this website does not constitute investment advice or a recommendation to purchase or sell any securities or other financial instrument or any particular strategy or fund. Market commentary, product information and related performance data available on this website has been compiled from sources believed to be reliable and is provided in good faith for informational purposes only. UBS Asset Management does not guarantee the accuracy, suitability or completeness of information contained on this website, and all such information, including but not limited to performance data and related metrics, is subject to change without notice. Certain content on this website is intended for institutional investors and their financial representatives only, and should not be relied upon by retail investors or members of the general public.

Market commentary and similar statements contained herein are based on current expectations and may be considered “forward-looking statements.” Actual future results, however, may prove to be different from expectations. The opinions expressed are a reflection of UBS Asset Management’s best judgment at the time of posting, and any obligation to update or alter any forward-looking statement as a result of new information, future events, or otherwise is disclaimed.

Investments involve risks, are not guaranteed and may not return the original principal amount invested. Past performance is no guarantee of future results. Investors should read all available product information carefully before making an investment decision, including information about applicable risks, fees and expenses. This website does not address the investment objectives, risk tolerance or financial needs of any particular investor. In addition, any statements regarding investment performance expectations, risk and/or return targets do not constitute a representation or warranty that such expectations or targets will be achieved.

This website is not intended for persons located in any jurisdiction where the availability of this website is prohibited or contrary to local law or regulation or would subject any UBS entity to any registration or licensing requirement in any such jurisdiction.

Please confirm you are a US resident to proceed.

Please select at least 1 checkbox