This paper provides an overview of the Chinese new energy vehicle industry and discusses the role of state in the industry's development. Chinese policies have aimed to promote the development of new energy technologies and to reduce the consumer price of hew energy vehicles. Chinese authorities have also been concerned about the balance between collaboration and competition in the sector, since most key actors are owned by the state. One solution has been the establishment of a number of industry alliances linking auto enterprises, universities and research institutes, to promote both collaboration (within each alliance) and competition (between alliances). (C) 2012 Elsevier Ltd. All rights reserved.