Daimler CEO says electric cars need incentives to become mainstream

FRANKFURT (Reuters) - Daimler <DAIGn.DE> Chief Executive Ola Kaellenius on Wednesday said the resulting drop in sales of electric and hybrid vehicles in China after incentives were curbed shows that they are still needed.

The China Association of Automobile Manufacturers (CAAM), said sales of new energy vehicles (NEVs) fell 45.6% in October from year-ago levels, following a 33% decline in September.

"When China pulled back incentives for new energy vehicles the market was down. It went into freefall. It is important to have an incentive structure during the transformation phase," Kaellenius said, commenting on the shift away from combustion engines.

CAAM said last week that fewer NEV's could be sold in China this year than in 2018 as customers hold back purchases following the government's decision this year to cut back subsidies.

(Reporting by Edward Taylor; Editing by Elaine Hardcastle)