While markets such as China look to renewable energy to reduce their reliance on fossil fuels other technologies are also being developed to help clean up air and boost sustainability.
Against this backdrop, the development of electric vehicles in China is very significant as it is the largest producer and buyer of EVs and wants to be a leader in global innovation in this area.
China’s high rate of adoption has been driven by policy and subsidies, though these are now being reduced. Nevertheless, we expect penetration of electric vehicles in China to reach 10% of car sales by 2022 and the switch to EV technology could significantly aid air quality improvements in Chinese cities.
Naomi Waistell, portfolio manager, emerging market equities, Newton Investment Management.