Recently, the National Development and Reform Commission, the Ministry of Science and Technology, the Ministry of Industry and Information Technology, and the Ministry of Finance jointly issued the Guiding Opinions on Expanding Investment in Strategic Emerging Industries and Cultivating New Growth Points and Growth Poles (hereinafter referred to as the Opinions). The Opinions propose 20 key directions and supporting policies, including new energy vehicles, to promote the high-quality development of strategic emerging industries.
Recently, the National Development and Reform Commission, the Ministry of Science and Technology, the Ministry of Industry and Information Technology, and the Ministry of Finance jointly issued the Guiding Opinions on Expanding Investment in Strategic Emerging Industries and Cultivating New Growth Points and Growth Poles (hereinafter referred to as the Opinions). The Opinions propose 20 key directions and supporting policies, including new energy vehicles, to promote the high-quality development of strategic emerging industries.
The Opinions state that steps should be taken to accelerate the innovation and development of the bioindustry, achieve leapfrog development in the new energy industry, strengthen the basic supporting capacity of the intelligent and new energy vehicle industry, accelerate pilot demonstrations in the energy conservation and environmental protection industry, and speed up the integrated development of the digital creative industry.
At present, China leads the world in the production and sales scale of new energy vehicles. Over the past three years, China has consecutively ranked first in the world in NEV production and sales, with cumulative production and sales exceeding 1.8 million units. In 2019, China's NEV production and sales reached 794,000 and 777,000 units respectively, up 53.8% and 53.3% year-on-year, with a market share of 2.7%, up 0.9 percentage points from the previous year.
The national New Energy Vehicle Industry Development Plan (2021-2035) states that the share of new energy vehicles in the production and sales of new cars will be raised from the originally planned 20% to 25%. Specifically, by 2025, China will increase NEV sales from 20% announced in 2017 to 25%, indicating that China's policymakers have decided to accelerate the development of new energy vehicles.
Raising China's NEV production and sales targets will have a significant impact on the landscape of the global automotive industry in the next fifteen years. Setting the growth target for China's NEVs not only means that China will become the world's largest NEV market, but also that through enhanced energy conservation and emission reduction, China's NEV industry will become a strong industry surpassing the European and American markets. As a related industry, the rare earth industry should also follow the trend.
As is well known, battery, motor, and electronic control are indispensable components of a new energy vehicle. The motor functions the same as the engine of a traditional fuel vehicle, equivalent to the heart of the car, while the power battery is equivalent to fuel, equivalent to the blood of the car. Rare earth is the most indispensable material in the manufacturing of motors. In addition, rare earth elements are also widely used in gears, tires, body steel, and other parts. It can be said that rare earth is an essential element in the new energy vehicle sector.
It is reported that each hybrid vehicle consumes about 2.5 kg of neodymium-iron-boron (NdFeB), while each pure electric vehicle consumes 5 kg of NdFeB. From door locks to sunroofs, ABS, speakers, windshield wipers, and electric motors, all involve the application of rare earth materials such as NdFeB.
It is understood that a fully automatic high-end car requires about 0.5 kg to 3.5 kg of rare earth permanent magnet materials. New energy vehicles use even more NdFeB materials. Each hybrid vehicle consumes about 3 kg more NdFeB than a traditional car. Pure electric vehicles use rare earth permanent magnet motors instead of traditional generators, consuming up to 5 to 10 kilograms of NdFeB.
Facts have proven that with the increase in domestic rare earth mining share, the growth rates of rare earth supply and demand are expected to remain synchronized until before 2025. Under such circumstances, the rare earth industry should contribute its share to the development of new energy vehicles. According to some data, since the emergence of new energy-powered vehicles in China, the use of rare earth has multiplied due to its close connection with new energy vehicles.