China has long relied on hefty incentives to steer consumers away from gasoline-powered cars and into electric cars. Next year, that may begin to change.

The country is mulling over the possibility of further reducing subsidies on electric cars next year, Bloomberg reported on Friday. The incentives could fall by one-third of their current amount. Furthermore, to qualify for new subsidies, electric cars will have to travel at least 125 miles on a charge, up from 93 miles currently.

China seeks to ensure the long-term success of its auto industry by pushing companies to innovate and create cars Chinese consumers want to purchase rather than rely on the incentives to move electric cars. The Chinese government spent $1 billion last year on electric-car subsidies. Cities and provinces also offer their own subsidies.

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Subsidies have already shifted slightly this year. The country lowered incentives for electric cars with ranges less than 186 miles, but increased subsidies for models with ranges over 250 miles. Chinese regulations will continue to shape the global auto sector as the government mandates “new-energy vehicles” and moves away from fossil-fuel-powered cars. Numerous automakers bank on China for their future global electric-car portfolios, including Volkswagen Group and General Motors.

The plan is not official yet, according to the report, and the final figures are subject to change.



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