Stringent New Fuel Economy Standards Imposed In China

After a long period of deliberation and debate, on Wednesday China mandated strict fuel economy standards on its domestic automakers.

The rules call for cutting average fuel consumption for passenger cars to 6.9 liters per 100 kilometers (about 34 mpg) by 2015 and to 5.0 liters (47 mpg) by 2020.

This new barrier to entry, according to Reuters, is expected to make things harder than they already are in a stagnating state of affairs for cash-poor domestic brands.

“That’s going to be tough for everyone, especially those small players as they will have to use more fuel-efficient engines and invest in hybrid technologies,” said Yale Zhang, the director of Greater China vehicle forecasts at CSM Worldwide, a consultancy firm.

China has long been accused of lack of regard for the environment in the automotive and other sectors. Presently discontent has sparked public protests and even riots in the massive developing economy.

On Sunday, Chinese Premier Li Keqiang said his government would increase its resolve in combating China’s pollution woes.

According to John Zeng, Asia Pacific director of consultancy LMC Automotive, as of 2009, passenger car fuel consumption was 7.8 liters per 100 kilometers in 2009 and 8.2 liters in 2008. Current fuel consumption numbers were not available at the time of this report.

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