Rural market in spotlight to tap growth

The campaign to promote new energy vehicles in China's rural areas features a larger and more diversified portfolio this year, catered to evolving consumer demands to unlock consumption potential in the extensive market.

Now in its sixth year, the "NEVs Going to the Countryside" initiative — launched by government bodies including the Ministry of Industry and Information Technology and the Ministry of Commerce — has selected 124 models, 25 more than 2024.

The selected models need to meet essential requirements including good sales performance, high brand recognition, and a well-established network of maintenance service points, said Xu Haidong, vice-chief engineer of the China Association of Automobile Manufacturers, one of the campaign organizers.

BYD's Dynasty and Ocean series, along with models from Dongfeng, Geely, Changan and BAIC, have joined in the program with high cost-performance offerings. Their product portfolios span plug-in hybrid SUVs to new energy commercial vehicles, including newcomers such as off-roaders and pickup trucks.

Notably, the Model Y and Model 3 have been selected, marking Tesla's first inclusion in the initiative.

Other models priced above 200,000 yuan ($27,850) on the list include the Li Auto L6 SUV, Nio ES6 SUV and ET5 sedan, Zeekr 001 shooting brake, and XPeng G9 SUV.

The involvement of the high-end brands indicates the upgrading of rural consumption, Xu said. Many automakers are keen to capture this significant vast market by providing high-performance, cost-effective models.

Cui Dongshu, secretary-general of the China Passenger Car Association, said that counties, towns and villages have a certain level of economic strength, and consumers there are willing to improve their quality of life. The untapped potential for NEV consumption in rural areas could become another driving force of growth in the Chinese automotive market.

At the first stop of the 2025 "NEVs Going to the Countryside" campaign held in Rugao, Jiangsu province, in mid-June, some models on display were tailored for rural consumers.

For those engaged in freight transport, some vehicles featured extra-large cargo spaces. For users balancing personal and commercial needs, there were models that offer five, six, or seven-seat configurations alongside pure electric and range-extended powertrain options.

However, Xu pointed out that the lack of charging infrastructure remains an obstacle to the widespread adoption of NEVs in rural areas, saying the vast geographical area and low population density result in high construction costs and long payback periods for charging stations.

In recent years, relevant departments have issued documents aimed at filling the gaps in county-level charging facilities, specifying annual construction tasks, and investment.

At the event in Rugao, some 10 charging station companies showcased their products and technologies. For example, private charging piles can be shared via apps, providing innovative solutions.

Xu suggested that properly advancing the layout of charging stations could promote NEV popularization, boost rural tourism, and aid the development of commercial vehicles.

He cited examples of automakers piloting integrated solar energy storage charging projects in rural areas, which use photovoltaic power generation to power charging stations, thereby cutting operational costs.

This year, the incentives for "NEVs Going to the Countryside" have been increased. In addition to the national trade-in policy and local government support, automakers such as BYD and Wuling have introduced exclusive discounts, with some models seeing price reductions of more than 10,000 yuan.

Financial institutions are contributing by offering low-interest loans, interest-free installment plans, and other financial solutions.

According to data from the CAAM, NEV sales in rural outreach activities exhibited growth from 2020 to 2024.Sales increased from 397,000 vehicles in 2020 to nearly 7.6 million in 2024, surpassing the sector's total market growth.

Fu Bingfeng, secretary-general of the CAAM, said over the past five years, there were more than 500 NEV models involved in the program with combined sales totaling 15 million units. Some rural areas have one NEV per five households, driving green mobility transformation in these regions, he added.

From January to May, NEV sales reached 5.61 million units in China, a year-on-year increase of 44 percent. NEVs accounted for 44 percent of the total new car sales during this period.

caoyingying@chinadaily.com.cn