SHARES of Chinese electric vehicle (EV) makers, including Warren Buffett-backed BYD Co., yesterday jumped after the government signaled it won’t continue reducing subsidies for the industry at the same pace this year.

Miao Wei, the minister for industry and information technology, told an audience in Beijing on Saturday EV-purchase subsidies won’t be cut July 1, like they were on that date last year.

“Please rest assured. There wont be a further cut July 1 this year,” Miao said in a speech at an industry forum. The audience, which included representatives from major automakers, was thrilled enough to applaud.

Though the minister later clarified his comments, investors and the industry interpreted his remarks as good news for EV manufacturers that were hit by subsidy reductions last year. Sales of new energy vehicles have dropped for six straight months in China since the government scaled back handouts in July.

A few hours after his speech, the minister’s amended statement was aired on China National Radio and the forum’s organizers asked reporters to refer to those comments.

“In order to stabilize market expectations, and ensure the industry’s sustained development, subsidies on new energy vehicles will stay relatively stable this year, and they won’t be scaled back significantly,” the radio station quoted the minister as saying.

Shares of BYD and competitor BAIC BluePark New Energy Technology Co. surged by their daily trading limit of 10 percent in Shenzhen and Shanghai trading, respectively. (SD-Agencies)