Encourage traditional consumer goods such as automobiles and home appliances to be trade-in, promote comprehensive conservation and accelerate consumption transformation...... At the beginning of the Year of the Dragon, two important meetings released a blockbuster signal

Every reporter: Zhang Huaishui Every editor: Chen Xu

The Spring Festival holiday in the Year of the Dragon has just ended, and two important meetings held at the central level have released a lot of heavy information to the market.

On February 23, Xi Jinping, General Secretary of the CPC Central Committee, President of the People's Republic of China, Chairman of the Central Military Commission, and Director of the Central Financial and Economic Commission, presided over the fourth meeting of the Central Financial and Economic Commission.

Xi Jinping delivered an important speech at the meeting, emphasizing that accelerating product upgrading is an important measure to promote high-quality development, and it is necessary to encourage and guide a new round of large-scale equipment renewal and consumer goods trade-in.

Previously, the fourth meeting of the Central Committee for Comprehensively Deepening Reform held on February 19 deliberated and approved a number of documents, involving the reform of the land management system and comprehensive green transformation. The meeting emphasized that to promote the comprehensive green transformation of economic and social development, it is necessary to focus on key areas of economic and social development and build a spatial pattern of green, low-carbon and high-quality development.

Xu Hongcai, deputy director of the Economic Policy Committee of the Chinese Society for Policy Sciences, said in a telephone interview with the reporter of the "Daily Economic News" that the two important meetings are to further implement and refine the spirit of the Central Economic Work Conference. Whether it is the trade-in of bulk consumption or the renewal of machinery and equipment, it will help tap the potential of consumption and investment, and is also an important starting point for expanding domestic demand.

Workers at an automobile company are engaged in production Image source: Xinhua News Agency

Encourage traditional consumer goods such as automobiles and home appliances to be traded-in

The fourth meeting of the Central Financial and Economic Commission stressed that the implementation of large-scale equipment renewal and trade-in of consumer goods will effectively promote investment and consumption, which will benefit both the present and the long-term. It is necessary to do a good job in policy combination, promote the continuous increase in the proportion of advanced production capacity, more high-quality durable consumer goods into people's lives, waste resources are recycled, and the quality and level of national economic circulation have been greatly improved. It is necessary to adhere to the market-oriented, government-guided, insist on encouraging the advanced and eliminating the backward, adhere to the guidance of standards, and improve in an orderly manner.

The meeting pointed out that it is necessary to promote the renewal and technological transformation of various production equipment and service equipment, encourage traditional consumer goods such as automobiles and household appliances to be exchanged for the new, and promote the trade-in of durable consumer goods. Promote large-scale recycling and recycling, and strengthen the development of the "replacement + recycling" logistics system and new models. For the trade-in of consumer goods, it is necessary to adhere to the linkage between the central government and local governments, and coordinate and support all links in the whole chain to benefit consumers more.

Haitong Securities Research Report believes that the fourth meeting of the Central Financial and Economic Commission mainly emphasizes three aspects: first, in the face of high-quality development, accelerate industrial upgrading, promote the continuous increase in the proportion of advanced production capacity, and improve the scale of high-quality durable consumer goods; second, accelerate energy conservation and carbon reduction, so that waste resources can be recycled; third, improve economic operation efficiency, promote consumption, and expand investment.

Everbright Securities' research report believes that the mainland home appliance and automobile market has entered an "era of equal emphasis on increment and stock", and the scrapped volume of household appliances and automobiles has shown a gradual upward trend in recent years, and the market potential is huge. According to the 20-year scrapping rate, that is, 5% per year, the number of scrapped cars in the country will reach 16.8 million in 2023, and the number of scrapped household appliances is also on the rise, and the scrapped volume is expected to exceed 200 million units in 2022.

The research report further said that the meeting emphasized "adhering to the linkage between the central government and local governments" on the trade-in policy of durable consumer goods, and it is expected that the central government will give appropriate financial subsidies to encourage the demand for household appliances and automobile upgrading. The expansion of consumption scale and the optimization of consumption structure through the trade-in of consumer goods will help to promote the upgrading of the supply side from the demand side, promote the elimination of excess capacity, and promote modern emerging industries to gain a larger market share.

Corporate viewpoint: Contribute to brand continuation and market share increase

The Central Economic Work Conference held at the end of 2023 pointed out that traditional consumption should be stabilized and expanded, and bulk consumption such as new energy vehicles and electronic products should be boosted. It is necessary to improve technology, energy consumption, emissions and other standards as the traction, and promote large-scale equipment renewal and consumer goods trade-in.

The reporter of "Daily Economic News" combed and found that in 2009, 10 departments including the Ministry of Finance, the Ministry of Commerce, and the Ministry of Industry and Information Technology jointly issued the "Implementation Measures for the Trade-in of Cars", and determined to give a replacement subsidy ranging from 3000 ~ 6000 yuan.

In 2023, 13 departments, including the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the Ministry of Commerce, once again proposed to support the renewal and consumption of old cars in the "Several Measures to Promote Automobile Consumption" jointly issued.

On January 26, 2024, Wang Wentao, Minister of Commerce, said at the press conference of the State Council Information Office that he would promote the trade-in of automobiles and home appliances, which is a key point in promoting consumption this year.

According to the statistics of the Ministry of Commerce, the mainland automobile and home appliance market has entered the "era of both increment and stock" from the simple "incremental era". In 2023, the number of cars will be about 340 million, and the number of major categories of household appliances such as refrigerators, washing machines, and air conditioners will exceed 3 billion.

The fourth meeting of the Central Financial and Economic Commission once again proposed to study the issue of large-scale equipment renewal and the trade-in of consumer goods, and to study the issue of effectively reducing the logistics cost of the whole society.

The relevant person in charge of Haier Group said in an interview with the WeChat reporter of "Daily Economic News" that the trade-in policy of household appliances will effectively stimulate market consumption. Under the guidance of relevant national policies, with the release and implementation of policy details, users' enthusiasm for purchasing household appliances will be effectively improved, which will drive the entire industry to usher in new market opportunities.

The above-mentioned person in charge revealed that in the recycling process, Haier relies on more than 30,000 stores across the country to quickly carry out household appliance recycling and trade-in activities nationwide. At present, Haier, together with the Shandong Provincial Department of Commerce and other functional departments, has provided more convenience for users to trade in the old for the new by launching coupons and other means. At the same time, Haier has also built the first recycling interconnection factory in the home appliance industry, which can disassemble 2 million waste household appliances every year, and has an annual carbon emission reduction capacity of about 17,000 tons. ”

Jiangsu Jinpeng Group is an enterprise engaged in the production, R&D and sales of new energy vehicles. Hou Dafu, head of the group's Jin Yishun brand, said in a telephone interview with the reporter of the "Daily Economic News" that the state encourages the trade-in of cars, on the one hand, it can reduce the cost of buying cars for consumers and buy new models at lower prices; on the other hand, for car companies, it will help the continuation of the brand and the improvement of market share.

"It is an indisputable fact that the fierce competition in the domestic new energy vehicle industry is an indisputable fact, and companies are building their own brand supply chains. Hou Dafu said that the company's electric vehicle products are exported to more than 80 countries and regions overseas. The implementation of the car trade-in policy will help the company better layout the domestic market and enhance the brand reputation.

Improve fiscal, tax, and financial policies to support green and low-carbon transformation

In recent years, the central government has repeatedly emphasized the concept of green and low-carbon transformation.

The fourth meeting of the Central Committee for Comprehensively Deepening Reform held recently emphasized that to promote the comprehensive green transformation of economic and social development, it is necessary to focus on key areas of economic and social development, build a spatial pattern of green, low-carbon and high-quality development, promote the green transformation of industrial structure, energy structure, transportation structure, and urban and rural construction and development, and accelerate the formation of production methods and lifestyles that conserve resources and protect the environment.

The meeting pointed out that it is necessary to grasp the key links to promote green transformation, promote comprehensive conservation, accelerate consumption transformation, and strengthen green technology innovation and the promotion and application of advanced green technologies. It is necessary to improve fiscal, tax, financial, investment, price policies and related market-oriented mechanisms to support the green and low-carbon transition, and provide policy support and institutional guarantees for the green transition.

The second meeting of the Central Deep Reform Commission held on July 11, 2023 also pointed out that since the 18th National Congress of the Communist Party of China, we have put green, low-carbon, energy conservation and emission reduction in a prominent position, established and implemented a dual control system of total energy consumption and intensity, and effectively promoted the significant improvement of energy utilization efficiency and the continuous decline of carbon dioxide emission intensity in the mainland. From the dual control of energy consumption to the dual control of carbon emissions, it is necessary to adhere to the principle of establishing first and then breaking down, improve the dual control system of energy consumption, optimize and improve the mode of regulation and control, strengthen the basic capacity building of dual control of carbon emissions, improve the supporting systems of dual control of carbon emissions, and actively create conditions for the establishment and implementation of dual control of carbon emissions.

The third meeting of the Central Deep Reform Commission held on November 7, 2023 emphasized that building a beautiful China is an important goal of building a modern socialist country in an all-round way, and it is necessary to anchor the basic realization of the goal of a beautiful China by 2035, continue to promote pollution prevention and control, accelerate the green transformation of development mode, improve the diversity, stability and sustainability of the ecosystem, keep the bottom line of safety, improve the security system, and promote the fundamental improvement of the ecological environment.

Xu Hongcai said in an interview with the reporter of "Daily Economic News" that comprehensive green transformation is an inherent requirement for the mainland to achieve the "double carbon" goal and achieve high-quality economic development. All walks of life can take this opportunity to promote the progress of technology and accelerate the implementation and use of new technologies.

"At the same time, for traditional industries, it also helps to upgrade and transform traditional industries, which means new business opportunities, new profit models, and new development directions. Xu Hongcai said.

National Business Daily