Although automakers in China will see slow sales and tight margins through 2015 and into 2016, AltEnergyStocks reports that electrical vehicle manufacturers could recover faster.
“A flurry of headlines this week are sending ominous signals for the car industry in the year ahead, with both traditional and new energy vehicle makers likely to face an uphill road as China’s economy slows,” Young writes. “The problem could be compounded as big new capacity comes online from many major automakers that have invested billions of dollars on expansion over the last three years.”
Recent news reports have suggested that Tesla Motors and domestic manufacturer BYD Co. Ltd. would miss their sales targets in China. But the government is extending its incentives for “green vehicles” from 2015 through 2020 in an effort to “reassure some people who are still waiting to see whether infrastructure will improve.”