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Chen Hong on behalf of suggestions to encourage the development of auto parts remanufacturing

Chen Hong, vice chairman of the National People's Congress and deputy chairman of SAIC Motor Group, has submitted two key proposals during this year’s two sessions: one titled "Proposal on Accelerating Energy Conservation and Emission Reduction and Promoting the Industrialization of Hybrid Electric Vehicles in China," which has drawn significant attention from industry experts. During an interview, Chen shared another suggestion — "Recommendations on Promoting the Construction of a Recycling Economy and Encouraging the Development of Domestic Auto Parts Remanufacturing." Both proposals reflect his deep thinking on implementing the scientific development concept and building a sustainable automotive industry. Chen highlighted that with China's rapid economic growth, the pressure on traditional vehicles in terms of energy consumption and environmental protection is growing. According to conservative estimates, if current internal combustion engine technology continues to dominate, vehicle fuel consumption in China could reach 250 million tons by 2020. The environmental impact of automobile exhaust emissions is severe, with greenhouse gas emissions needing urgent control. This year, China may become the world’s largest emitter of carbon dioxide, facing intense international pressure. In cities like Beijing and Shanghai, air pollution data shows that vehicle exhaust accounts for as much as 75% of harmful gas emissions. Among various new energy vehicle technologies, hybrid power appears to be the most practical solution to address the current challenges between rising auto demand, environmental protection, and energy security. Compared to fuel cell and alternative fuel technologies, hybrid vehicles offer better economic and emission performance. They can achieve a 10-30% improvement in fuel efficiency over conventional vehicles and meet Euro 4 emission standards, making their industrial prospects more promising. Currently, under national planning and the efforts of manufacturers, China has made initial progress in producing hybrid vehicles. However, major obstacles still exist, including high R&D costs, limited market size, and relatively low domestic component technology levels. There is also a noticeable gap between China and developed countries in terms of supporting policies for hybrid vehicle industrialization. Chen Hong believes that government support should be strengthened across R&D, production, sales, and consumer use. He suggested that the government focus on nurturing a few core component companies in the hybrid vehicle sector. Regarding production and sales, he proposed that the state should provide further tax incentives to companies engaged in hybrid vehicle R&D. He also emphasized the need for a differentiated vehicle tax system based on fuel economy and pollutant emissions. In terms of consumer usage, he advocated leveraging the demonstration effect of government procurement to reduce user costs through tax reductions and exemptions, while offering priority access to roads for hybrid vehicles. These measures are crucial to promoting the widespread adoption of hybrid technology in China.

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