GUANGZHOU—Electric vehicles aren’t yet living up to the hype, auto makers in China are finding, as they churn out more EVs than they can sell to satisfy government directives.

Beijing tempts buyers with subsidies and the construction of a vast charging network—and pushes consumers to buy electric cars in crowded cities. The policies have made China a driving force in world-wide development of EVs, and left foreign auto makers scrambling to keep up.

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