Beijing limits prices, engine sizes of vehicles purchased by government
China's central government has set limits on the prices and engine sizes of vehicles purchased by government organizations to curb fast-rising vehicle procurement expenditures.
Under regulations issued last week, governmental organizations are barred from purchasing vehicles with prices exceeding 180,000 yuan ($28,300) or with engine displacements above 1.8 liters.
If the vehicles are plug-in hybrids or pure electric vehicles, their price cannot exceed 180,000 yuan after subsidies.
Currently, the central government offers sales subsidies ranging up to 50,000 yuan for plug-ins and 60,000 yuan for EVs.
Government agencies across China spent 80 billion yuan on vehicle procurement in 2010, according to Chinese media reports.
Restrictions on vehicle procurement, if strictly enforced, could deal a heavy blow to international luxury brands. For example, government procurement accounts for one-third of Audi A6 sales.
The A6 is Audi's best-selling model in China.
