In March of 2009, China implemented a policy to subsidize the purchase of vehicles with engines displacing 1.6 liters or less and that consume fuel at a rate of at least 20 percent below the average auto sold in China. The policy slashed taxes on vehicles with low-displacement mills and effectively awarded automakers 3,000 yuan ($451 U.S. at the current exchange rate) for each eligible vehicle built. In 2010, changes to the policy slightly reduced the amount of the incentive.
The National Development and Reform Commission in China recently added 71 models from 16 different automakers to the approved list of vehicles that qualify for subsidies based on fuel efficiency alone. All of the qualifying vehicles are fitted with engines no larger than 1.6 liters and consume fuel at a rate of at least 20 percent below the average vehicle sold in China. Models such as the Hyundai i30 pictured above, will receive a subsidy of 3,000-yuan, which comes to a laughably small $442 (U.