The Impact Of Government Subsidies On R&D Activities Of New Energy Automobile Enterprises

The Third Plenary Session of the 18th CPC Central Committee proposed that in the comprehensive deepening reform,it is necessary to emphasize the decisive role of the market in resource allocation,which means that the role of the market and the government will be repositioned.In December 2016,the four ministries jointly issued the"Notice on the Financial Support Policy for the Promotion and Application of New Energy Vehicles in 2016-2020",which proposed the government subsidy for the new energy vehicle industry for the first time,by 2020,government subsidies will be completely abolished.This move announced that the government will open a"post-policy-driven era".The new energy auto industry will be driven by policy-driven,to policy-driven and market-driven,and will ultimately be driven by market-driven development of the new energy auto industry.In February 2018,the subsidy of the New Deal was issued to raise the threshold for energy density of electric vehicle power battery systems,and the subsidy standards for new energy buses and special vehicles were once again lowered,speeding up the subsidy declineAfter the implementation of the New Policy,more than 2,000 models have not been subsidized because the energy density of power batteries and the cruising range of new energy vehicles are not up to standard.In addition,structural overcapacity in the power battery industry,coupled with huge financial pressure,many medium enterprises will fall into the dilemma of low-end product positioning,insufficient capacity utilization and difficulty in returning funds.As a leading enterprise of new energy vehicles,BYD has received high subsidy funds for R&D activities every year,but still can not actively respond to the technical threshold requirements of subsidies.How government subsidies affect BYD’s R&D activities will be the focus of this paper.Based on the analysis of case study method,this paper will select BYD Company,the leading enterprise of new energy vehicles,to conduct research.Firstly,propose the theoretical basis of this paper,analyze the changes of the new energy government subsidy policy and existing shortcomings.Separately introduce the subsidies and R&D activities of the new energy auto industry and BYD.Secondly,analyze the impact of government subsidies on BYD’s R&D activities from both favorable and unfavorable perspectives.The beneficial effects of government subsidies on R&D activities are reflected in the following three aspects:First,government subsidies have promoted the increase in the scale of R&D input and output of BYD.Second,the subsidy policy has led BYD’s power battery research and development direction to change from lithium iron phosphate battery to ternary lithium battery to meet market demand.Third,government subsidies have eased the company’s financing constraints,adjusted performance and reduced financing diff-iculty,which promoted BYD’s R&D investment.The adverse effects of government subsidies on R&D activities are reflected in the following three aspects:First,the guidance of government subsidies has caused BYD to pay too much attention to subsidy projects,resulting in an imbalance in R&D investment structure.Second,excessive expansion on core R&D products.Third,government subsidies caused a large number of R&D investment,the pressure on profits from R&D investment has made BYD’s R&D expenditure capitalization rate high.Finally,in view of the adverse impact of government subsidies on BYD’s R&D activities,it puts forward suggestions on how subsidy policies can promote R&D activities,and proposes improvement measures for BYD’s R&D activitiesThrough the analysis and research on the case company BYD’s R&D activities and government subsidies,this paper draws the following three conclusions:First,government subsidies have a positive impact on BYD’s R&D activities.Second,BYD Company over-subscribes subsidy policies,conducive to the healthy development of the company Third,to promote the healthy development of the market requires the joint efforts of the government and enterprisesThe innovations of this paper are as follows:the first is to analyze the impact of government subsidies on R&D activities in the form of case studies,provide new ideas for related research;the second is to analyze government subsidies in enterprise R&D activities from two competitive perspectives:favorable and unfavorable.The role of the"double-edged sword"reveals the economic consequences and mechanism of government subsidies;the third is to enrich the breadth of literature research on the negative effects of government subsidies on R&D activities.