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Tesla earned US$437 million in Chinese government subsidies, trailing the world's largest electric car maker

The BYD Han performance sedan is a direct Tesla competitor (image: BYD)
The BYD Han performance sedan is a direct Tesla competitor (image: BYD)
The world's second biggest electric vehicle maker Tesla benefited less from the Chinese government 's sustainable transportation credits than the largest EV manufacturer BYD. The Buffett-backed carmaker scored half a billion dollars, while Tesla netted US$437 million.

The number of what China collectively calls new energy vehicles (NEV) just passed 10 million there for the first time. In its calculation the country includes purely electric vehicles, of which there are now 8.1 million on the road there, as well as plug-in hybrid electric vehicles, and fuel cell electric ones manufactured in the country, all of which are eligible for government subsidies. Called the dual-credit system, these subsidies are calculated on the basis of both average corporate fuel consumption, as well as the number of NEVs in the carmaker's portfolio.

The credits, each of which equaled to about US$312 in 2021 should the company decide to trade them, can be positive or negative, depending on where the respective automaker stands on the transport sustainability scale. Needless to say, those companies which produce a number of electric cars, stand to earn the most positive credits. Recently, the Warren Buffett-backed BYD became the world's largest EV maker, while Tesla stepped down to second place on supply chain challenges and Shanghai Gigafactory production woes.

BYD earned the most in Chinese government subsidies - the equivalent of US$516 million last year - while Tesla trailed it slightly with US$437 million in taxpayer loot. In its last annual financial statement, Tesla disclosed that it has earned US$1.5 billion in government credits for 2021, quite the big chunk from its total of US$5.2 billion in net income then. A lot of the subsidies came from foreign governments and, apparently, China's dual-credit system seems to be one of the largest contributors to Tesla's bottom line in that respect.

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> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2022 07 > Tesla earned US$437 million in Chinese government subsidies, trailing the world's largest electric car maker
Daniel Zlatev, 2022-07- 7 (Update: 2022-07- 7)