A charging plug sits connected to a General Motors Co (GM) Chevrolet 2017 Volt hybrid electric vehicle (EV) at a charging station in Jeju, South Korea, June 14, 2017. [Photo/VCG]

THE MINISTRY OF FINANCE is reportedly mulling further policies to support the production of new energy vehicles, as the current subsidy system will expire in 2021. Beijing Youth Daily commented on Monday:

The promising prospects for new energy vehicles in the Chinese market have lured major automakers into exploring the development of such vehicles and relocating their research centers here. Thanks to the government's subsidies and policy support, sales of new energy vehicles in the country hit 68,000 last month, a 76.3 percent rise year-on-year, according to the China Association of Automobile Manufacturers.

The competition of foreign automakers could be both a boon and a challenge to Chinese manufacturers. Once a world factory featuring low-end car manufacturing, China is now taking a different approach and attaching greater importance to intellectual assets and high-end technology.

The gradual withdrawal of capital from China's bricks-and-mortar industries in recent years has been the result of rising labor costs and stricter environmental protection rules, as well as the weak profitability and innovation capabilities of many Chinese manufacturers. It is vital that China's burgeoning new energy vehicle industry shift its focus from outsourced tasks to independent research and development.

In other words, China should open up to leading foreign enterprises while bargaining for the entry of their technologies and designs too. Although this will not be easy, due to political and competition concerns, it is worth the effort and could contribute to the long-term growth of China's new energy vehicle industry.

Automakers with their eyes on the lucrative Chinese market need to strike a balance between market share and technological "supremacy".