(Yicai) March 5 -- Shares in Dongfeng Automobile and two other Chinese state-backed carmakers surged today after the state assets manager said their new energy vehicle businesses will be assessed independently.

Dongfeng [SHA: 600006] jumped by its 10 percent daily trading limit to close at CNY6.55 (91 US cents) in Shanghai today. In Shenzhen, FAW Jiefang Group [SHE: 000800] ended up 6.6 percent at CNY9.23, and Chongqing Changan Automobile [SHE: 000625] finished 2.3 percent higher at CNY15.03 (USD2.1).

The new review process will aim to stimulate innovation at the three centrally-managed automakers and remove the institutional handicaps that are holding them back, said Zhang Yuzhuo, head of the State-owned Assets Supervision and Administration Commission.

Speaking in Beijing today at the so-called Two Sessions, China’s key annual policy-setting meetings, Zhang said the SASAC recognizes the significant initial investment required for NEV firms, and that using short-term profits as a way to review their performance could hinder their development.

Instead, the SASAC will adjust its policy and review the NEV businesses to focus on their technologies, outlook for development and market share. 

Of the three state-backed carmakers, Changan Auto has had the most success with its NEV business to date. It sold 474,045 units last year, a 75 percent increase on 2022. By comparison, sales at leading Chinese NEV maker BYD jumped 62 percent to 3 million last year.

Editor: Tom Litting