In an unprecedented turn, 13 cities have become ‘test cities’ for the introduction of subsidies for hybrid vehicle purchases. Beijing, Shanghai, Chongqing, Changchun, Dalian, Hangzhou, Jinan, Wuhan, Shenzhen, Hefei, Changsha, Kunming and Nanchang have signed up for the test, which will see the various city governments offer subsidies not only to private hybrid buyers, but also government buyers, which will include sedans for government use, but will also see subsidies available for hybrid public buses, and hybrid taxis etc.

The subsidies will be given once to the buyer, and it will be also available for LPG/CNG/ vehicles, pure electric vehicles, as well as hybrids. The subsidy will be based on the vehicle price, as well as the technology employed, this might actually lead to a ladder system where possibly CNG/LPG vehicles receive the smallest subsidy, and pure electric vehicles receive a larger amount. The exact subsidy amounts have yet to be announced.

The Chinese hybrid market still remains extremely small when compared to Western markets, less than a 1000 hybrids cars were sold in 2008.