A new round of "trade-in" has launched a new opportunity for home appliances to welcome green transformation and consumption upgrading

Reporter Chen Jingbin reports from Guangzhou

At the two sessions in 2024, the "Government Work Report" clearly put forward the focus of this year's work, that is, to promote the economy into a virtuous circle by expanding domestic demand, and especially emphasized the importance of encouraging and promoting the trade-in of consumer goods.

In order to achieve this goal, the State Council recently issued the "Action Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in" (hereinafter referred to as the "Action Plan"). The plan sets a clear goal: by 2027, the recycling of used household appliances will increase by 30% compared to 2023, and the proportion of recycled materials in the domestic resource supply will also increase significantly.

According to current statistics, the total number of large household appliances such as refrigerators, washing machines, and air conditioners in mainland households has exceeded 3 billion. About 100 million to 120 million used household appliances are eliminated every year. In 2023, the total amount of waste household appliances recycled in the country has reached 4.5 million tons. Studies and calculations have shown that for every 1 ton of waste household appliances recycled, about 4.7 tons of carbon dioxide and other greenhouse gas emissions can be reduced by dismantling and reusing the renewable resources in them.

With the implementation of the country's new round of "trade-in" policy, it is expected to promote the upgrading of automobiles, home appliances and other products, which will bring trillions of yuan of growth space to the market. In an interview, the reporter of "China Business Daily" learned that in response to the country's green development strategy, a number of home appliance companies in South China, including Midea, Galanz and Wanhe Electric, are actively following the pace of national policies and vigorously promoting the trade-in activities. The launch of this new round of "trade-in" policy is not only expected to inject new vitality into the home appliance industry in South China, but also further promote the green transformation and sustainable development of the mainland economy.

Stimulate the vitality of consumption

In recent years, the "trade-in" policy jointly advocated by the state and the industry has become an important engine to stimulate the vitality of the home appliance market. In particular, this policy has played a significant role in the promotion and popularization of green household appliances.

The Action Plan recently released by the State Council proposes four major actions, including trade-in of consumer goods and recycling. The plan encourages home appliance sales enterprises to cooperate with production enterprises and recycling enterprises to carry out trade-in promotions and open special areas online and offline. In addition, the government has also provided preferential policies for consumers to use old household appliances to purchase energy-saving new products, thus officially launching a new round of "old for new" activities for household appliances.

Home appliance companies have actively responded to the government's call and have begun to implement relevant actions. Taking Midea Group as an example, from February 19th to March 31st this year, Midea launched the "Midea Fire March, Quality Renewal Season - One-stop Purchase of Whole House Household Appliances Renovation Bureau", and fully launched the new promotion of the spring home appliance market. By providing preferential measures such as "subscription can enjoy 119 hang-up cleaning worth 0 yuan" and "0 yuan new product trial", it stimulates consumers' demand for replacement and local transformation. At the same time, Midea also provides one-stop pre-sale, in-sale and after-sales service to ensure that consumers can buy without worry.

During the "Midea Fire March" event, the "trade-in" service was further promoted. The service is not only stationed in the community, villages and towns, but also provides face-to-face product experience and free door-to-door collection service. The deduction amount of the old machine is as high as 1,000 yuan, while the subsidy range for the new subsidy products is 20 to 1,000 yuan per unit, and there are more than 500 product SKUs participating in the policy, showing unprecedented subsidy strength and product variety.

Wanhe Electric is not far behind. On February 27 this year, the company launched a welfare campaign for old users. Nationwide, Wanhe looked for 30 old users and replaced them with a new gas water heater for free to thank them for their support and companionship over the years.

Galanz also actively responded to the national green consumption and circular economy policy, and announced the launch of a new round of "trade-in" action for household appliances on March 28. The campaign aims to encourage consumers to eliminate old home appliances, choose more energy-saving and environmentally friendly green and healthy products, and promote the green upgrade of the home appliance market. The subsidy policy provided by Galanz allows consumers to enjoy a subsidy of 5%-10% when purchasing designated household appliances in flagship stores, covering microwave ovens, ovens, steam ovens, dishwashers, refrigerators, washing machines, water heaters, smoke stove sets, etc.

Galanz's "trade-in" action covers flagship stores on major platforms across the network, including Tmall, JD.com, Pinduoduo, Vipshop, Douyin, Kuaishou, Zhiwu Lianggong, etc. Consumers can enjoy the subsidies provided by Galanz, as well as the superposition of e-commerce platform policies and local government subsidies, and enjoy multiple discounts.

Zhan Junhao, a well-known strategic positioning expert and founder of Fujian Great Aim Brand Positioning Consulting, said in an interview with reporters that the multi-measure "trade-in" strategy of home appliance enterprises in South China will help stimulate the consumer market, expand domestic demand, and promote a virtuous cycle of the economy. With the arrival of the peak period of the home appliance market upgrading, these measures will further enhance the enthusiasm of users to purchase new home appliances and bring greater market increment to the home appliance industry.

In addition, Zhan Junhao also pointed out that the "trade-in" policy of household appliances can effectively break through the consumption blockage, so that the old household appliances that have been in service for a long time can be recycled greenly, and at the same time, new and high-quality household appliances can enter more families, driving the quality and expansion of the entire household appliance industry.

Promote the high-quality development of the industry

In recent years, the mainland's "trade-in" campaign has achieved remarkable results in benefiting consumers and promoting industrial upgrading.

Taking Midea Group as an example, in 2023, the company will invest more than 1.5 billion yuan in consumer subsidies and promotion activities through the implementation of dual preferential policies of "recycling subsidies" and "replacement subsidies", serving 3.6 million users and converting sales of more than 15 billion yuan. At the same time, Midea Group actively responded to the national policy, and as one of the first enterprises to participate in the "National Household Appliance Manufacturer Recycling Target Responsibility Action", it is committed to building a green recycling system, successfully recycling and processing 3.1 million waste household appliances, effectively promoting the consumption upgrading of household appliances and the healthy development of the industrial chain.

Galanz Group has also taken active measures to meet a wide range of green consumption and replacement needs. The company toured the country to carry out the "Green Home Appliances in Thousands of Counties and Towns in China" activity, according to the actual local needs, to provide consumers with appropriate products and services. In addition, the activity supports the model of "offline experience, online ordering", consumers can experience the product at their doorstep, and purchase it through the Zhiwuliang Industrial City App or mini program, which effectively meets the diversified, personalized and high-quality needs of consumers.

At present, it is time to promote a new round of "trade-in" activities for consumer goods.

As a trillion-level industry in the mainland, the household appliance industry accounts for more than 50% of the world's output, and the industrial chain is huge. As the mainland home appliance market has entered the "era of both increment and stock" from the "incremental era", the number of major categories of household appliances has exceeded 3 billion units. The life cycle of household appliances is usually 8-10 years, and at present, a considerable number of products have been "overdue", and the renewal demand and potential are in a concentrated release period.

In this context, the mainland home appliance industry is at a critical stage of green transformation. By promoting large-scale trade-in of household appliances, it can not only accelerate the popularization of green and smart consumer goods, meet the people's yearning for a better life, but also provide continuous product structure optimization and green transformation power for the supply side, and promote the high-quality development of the industry.

However, the "trade-in" campaign still faces many challenges. Yuan Shuai, deputy secretary-general of Zhongguancun Internet of Things Industry Alliance, pointed out that consumers' awareness of the "trade-in" policy is not high, and the enthusiasm for participation needs to be improved; the recycling channels and processing capacity of waste household appliances are limited, which is difficult to meet the needs of large-scale upgrading; in addition, there are problems such as insufficient policy implementation and insufficient supervision in some areas.

In order to cope with these challenges, Yuan Shuai suggested that policy publicity and education should be strengthened first, so as to increase consumer awareness and participation in the "trade-in" policy. Secondly, improve the recycling system and processing capacity of waste household appliances, establish and improve the recycling network and dismantling and reuse mechanism. Finally, strengthen policy implementation and supervision to ensure that the trade-in activities are fair, just and effective.

"In short, the central government's promotion of household appliances 'trade-in' promotional activities is not only conducive to expanding domestic demand and promoting consumption, but also helps to promote the industrial upgrading and sustainable development of household appliance enterprises. Achieving this goal requires the joint efforts of governments, businesses and consumers to overcome the relevant difficulties and ensure the effective implementation of policies and the healthy development of the market. Yuan Shuai said.