Photo: Asia Times/Lin Wanxia
Photo: Asia Times/Lin Wanxia

Drivers looking to go green in highly congested Hong Kong turned bright red in late February upon learning that their dream car would suddenly cost nearly twice as much as they have saved from April 1 – the day the government begins taxing electric vehicles.

Instead of a full waiver to the First Registration Tax, a cap is now in place, putting the maximum discount at just HK$97,500 (US$12,500) – a miniscule amount compared to the hefty savings well north of half-a-million Hong Kong dollars that many owners of the popular Tesla Model S have enjoyed, for example.

Against this policy setback, a hopeful local automobile association in Hong Kong is trying to steer the development of electric vehicles back on the right track in the city, and pioneered an open forum for new energy cars this week. It gathered all automobile heavyweights under one roof to bang out a new path forward for the future of Hong Kong’s transportation.

Andrew Chan On-tak, chairman of the Committee of New Energy Automobile on the left, with Dobbie Cheng Wai-ping, the deputy chairwoman in the middle. Photo: Asia Times

The New Energy Cars Forum took place in the fully-seated Charles K. Kao Auditorium of the Hong Kong Science Park on Tuesday, hosted by Hong Kong Left Hand Drive Motors Association’s newly formed Committee of New Energy Automobile.

Academic experts, legislators, and representatives from the car industry and the government butted heads in an octane-fueled afternoon, involving both policy proposals and live debates.

Though some critics were quick to label the government’s rollback in the electric vehicle subsidy as “backward” sending the wrong message for a city that is trying hard to transform itself into a clean-tech community, many car industry players believe the move will further open up the market for fairer competition.

Denny Chan Ming-him, chairman of the nearly three-decade old car association that boasts a membership of top Hong Kong dealers operating both locally and on the mainland, said there was a strong wish among his peers to bring the benefits of China’s maturing electric vehicle boom back to the fragrant harbor.

Chan welcomed the government’s decision to lift the blanket tax waiver saying that “the previous policy subsidy that benefited predominantly only one brand of car manufacturer is unfair to other brands.”

The argument is that the cap on the tax waiver would remove the tax advantage on luxury electric vehicles and open opportunities for carmakers to produce more lower-priced models for the average consumer.

The relatively higher price tag of an electric vehicle compared to its gasoline-fueled equivalent is only the first obstacle for many drivers wishing to switch over as charging remains a key concern in a town notorious for its outrageously expensive real estate.

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Frankie Yick Chi-ming, a legislator from the transport constituency, said he was working on a proposal to enhance the infrastructure development for electric vehicles, especially the availability of charging stations around the city.

Frankie Yick Chi-ming, a legislator from the transport constituency made a keynote speech on the New Energy Car forum took place in Hong Kong Science Park on May 16, 2017. Photo: Asia Times

“The government should use the tax it now collected to build more chargers for electric cars,” Yick said. He suggested that the government should amend the Building Ordinance and order real estate developers to equip every parking space with a plug in new housing projects, and not only those underground.

“It is important to prepare the city for electric cars, as it is an irreversible trend,” Yick added.

“It takes more than six hours to fully charge a car with an 18 kilowatt-hour battery by using a regular household plug [13 ampere],” said Raymond Kung Wah-hoi, operator of the quarter million square feet Kowloon Bay integrated Auto Mall that houses over 100 car dealerships specializing in second-hand vehicles and parallel imports.

“Slow charging takes a long time and is an extra burden to car owners since many charging stations are located inside fee-based parking lots, which could easily cost drivers over HK$30 per hour in the bustling commercial districts,” Kung elaborated.

So far, there are around 8,000 registered new energy vehicles in Hong Kong, accounting for 1% of the total.

As at the end of March 2017, there are over 1,500 chargers for public use, including about 520 medium chargers in Hong Kong, covering all 18 districts in various types of buildings, the Environmental Protection Department website said.

Cars exhibited at the Kowloon Bay integrated Auto Mall. Photo: Asia Times

Earlier this year, apart from those who already placed an order for an electric vehicle and will take delivery before the preferential tax regime expires, potential environmentally-friendly car buyers frowned on the government’s decision to end the full waiver of the First Registration Tax for electric cars on March 31.

Financial Secretary Chan Mo-po said the policy change was aimed at curbing the number of cars on Hong Kong’s congested roads and improving traffic.

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