China is considering temporarily easing quotas designed to boost production of electric cars to help automakers badly bruised by the coronavirus pandemic to revive slumping sales, people familiar with the matter said.
"Policymakers acknowledged that automakers are strained to promote electric models when overall demand is slowing. They want the auto industry to recover steadily this year," one of the four people familiar with the matter said. China requires automakers doing business in the country to follow strict rules covering the production of so-called new energy vehicles as part of a quota system.
The change in policy is largely aimed at helping automakers focus on selling more profitable gasoline cars to improve their cash flow. But a small group of companies - mostly Chinese automakers such as BYD - are already making money from electric vehicle sales.