EV startups face wipeout by new rules

China's electric-vehicle industry, with 200-plus companies backed by a raft of billionaires, verges on a massive shakeout as the government imposes stricter technology standards on fledgling manufacturers and considers limiting their number to only 10.

Any curbs would be aimed at weeding out the weak, said a senior executive with the State-backed auto manufacturers' association, and they may push as many as 90 percent of EV startups toward extinction, a government-linked newspaper said. So far, only two ventures have obtained approval to build cars, based on a review of National Development and Reform Commission documents. Three others say they plan to apply for permits.

Jack Ma, Terry Gou, Li Ka-shing and Jia Yueting are among the investors who've poured at least $2 billion into building alternative-energy vehicles as China tries to combat the smog choking its cities. Generous subsidies helped to cultivate a gold-rush mentality, prompting concerns the industry is plagued by too many companies lacking the technical know-how to make electric or hybrid cars that measure up to those from Tesla Motors Inc or General Motors Co.