14 departments have clarified the trade-in action plan, and nearly 10 million cars will be scrapped in 2024, and the official "trade-in applet" may be launched

Recently, the Ministry of Commerce and 14 other departments jointly issued the "Action Plan for Promoting the Trade-in of Consumer Goods" (hereinafter referred to as the "Action Plan") to implement the "State Council's Notice on Printing and Distribution".

In terms of automobiles, the Action Plan clearly states that by 2025, we will strive to accelerate the elimination of passenger cars with emission standards of China III and below, increase the recycling volume of scrapped vehicles by 50% compared with 2023, double the recycling volume of scrapped vehicles compared with 2023 by 2027, and increase the transaction volume of second-hand cars by 45% compared with 2023. Subsequently, Henan, Guangdong, Jiangsu and other provinces announced follow-up to jointly help achieve this goal.

Cui Dongshu, secretary general of the passenger association, said that the policy direction is very clear, seizing the new trend of scrapping in the market, and the growth potential of automobile consumption is huge. Cui Dongshu estimates that the net increase in scrapped vehicles in 2023 is estimated to be 7.56 million units, an increase of 32%. It is estimated that nearly 10 million scrapped cars will be scrapped in 2024, and 15 million scrapped cars will be scrapped in 2027, and the second-hand car transaction will exceed 20 million units in 2024 and 27 million units in 2027.

The funds are shared by the central and local governments, and the official "trade-in mini program" may be launched

In terms of carrying out the trade-in of old cars, the "Action Plan" covers increasing fiscal and financial policy support, appropriately reducing the down payment ratio of auto loans, eliminating old cars that meet the mandatory scrapping standards in accordance with laws and regulations, guiding enterprises to improve the level of recycling services, facilitating car owners to hand over cars, and promoting the door-to-door car collection service model, implementing facilitation measures such as "reverse invoicing" and off-site transaction registration for second-hand car sales, and breaking down various invisible obstacles.

Compared with the previous round of automobile scrapping and renewal in 2009, when the specific support policies were released for trade-in, there was no linkage, and the "Action Plan" covered all the contents related to trade-in second-hand car transactions, scrap recycling, automobile aftermarket, and auto finance.

Lu Jiamin, chief analyst of the automotive industry at Cinda Securities, told the China Times that the "Action Plan" starts from the fields of auto finance, automotive field standards, automobile recycling and dismantling, second-hand car trading and operation, and automobile circulation and consumption to carry out the whole chain of trade-in. "We believe that it has a strong effect on the prosperity of new car sales, second-hand car transactions, and automobile aftermarket. ”

Although the Action Plan has not yet set out clear proportions and standards in terms of financial arrangements and subsidy rules, it has been clarified that the source of funds will be shared by the central and local finances, and the two sides will work together and complement each other.

For example, in the implementation of financial policy support, the "Action Plan" mentions that "the central government and local governments will work together to arrange funds to support the scrapping and renewal of automobiles, and encourage qualified localities to support the replacement and renewal of automobiles." In terms of scrap recycling, the "Action Plan" mentions that "key projects of resource recycling that meet the requirements will be included in the scope of support such as investment in the central budget, and scrapped vehicle recycling and dismantling enterprises will be encouraged to improve the level of high-value comprehensive utilization of resources." ”

It can be understood that the scrapping and renewal policy is paid for by the state, and it is stimulated by real money to scrap and renew. Cui Dongshu said.

China Galaxy Securities Research Report also said that the "Action Plan" through the central financial arrangements of energy conservation and emission reduction subsidy funds to support eligible cars for the new, by encouraging car companies to promote the trade-in and attach importance to the use of energy conservation and emission reduction subsidy funds, not only in line with the current development trend of new energy vehicles to accelerate the replacement of fuel vehicles, but also in line with the current car company model update and iteration of the acceleration of the industry development, through the performance of upgraded new products with promotional activities to promote the release of replacement demand.

It is worth mentioning that the "Action Plan" clearly states that the official trade-in applet will be developed: "The car trade-in module will be added to the national automobile circulation information management system, the car data of relevant departments will be connected, the trade-in applet will be developed, and a unified car trade-in subsidy application portal will be provided, and the relevant parties will give financial protection." Cui Dongshu said that this move will bring effective subsidy support for scrapping old cars and updating new cars, which is what consumers are most concerned about.

A consumer in Beijing told the China Times: "I have a car in my hand that has been driving for almost ten years, and I have to change it, and I am very happy if I can replace it with a new car through scrapping and replacement subsidies." At the same time, the consumer also said: "I went to ask the Asian Dragon to give a discount of 3,000 yuan on the basis of replacing 6,000 yuan, which is equivalent to 9,000 yuan, which is still very cost-effective." Guangqi Honda Accord replacement subsidy also has 8,000 yuan. ”

Local rules have been introduced one after another, jointly helping nearly 10 million scrapped cars in 2024

With the release of the "Action Plan", many local governments in Shandong, Guangdong, Hunan, Henan, Suzhou, Jiangsu and other cities have clearly followed up on the trade-in policy, quantified the targets of scrapping and second-hand car transactions, and clarified the subsidy details, so as to jointly help achieve nearly 10 million scrapped cars in 2024 and 15 million scrapped cars in 2027, and the second-hand car transaction volume will increase by 45% compared with 2023.

The "Implementation Plan for Promoting the Trade-in of Consumer Goods in Shandong Province" issued by Shandong proposes that by 2025, the recycling volume of scrapped vehicles will reach 600,000, of which 180,000 scrapped passenger cars will be recycled in accordance with the conditions of trade-in, and by 2027, the recycling volume of scrapped vehicles will be about double that of 2023, and the transaction volume of second-hand cars will increase by 45% compared with 2023. Henan Province issued the "Henan Province Implementation Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in", proposing that the recycling volume of scrapped vehicles will about double compared with 2023, and the transaction volume of second-hand cars will increase by 45% compared with 2023.

Guangdong launched the "Implementation Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in in Guangdong Province", which clearly mentions that by 2027, the annual standardized recycling and dismantling volume of scrapped cars in Guangdong will be about 800,000, and the annual transaction volume of second-hand cars will exceed 4 million. At the same time, the implementation of a new round of consumer goods trade-in action, the development of car trade-in, encourage automobile production and distribution enterprises to carry out promotional activities, issue replacement subsidies, free charging piles and other forms of car purchase concessions. In addition, Guangdong Province has also further relaxed restrictions on car licensing indicators in Guangzhou and Shenzhen.

In addition, Hunan Province issued the "Hunan Province Implementation Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in", mentioning that in 2023, the number of cars in Hunan Province will exceed 11.8 million, and about 600,000 vehicles will be more than 10 years old, and the trade-in market space is huge. In 2024, the number of scrapped vehicles dismantled will reach 200,000, and by 2027, the number of scrapped vehicles will reach 320,000, and the number of used cars will reach 1.1 million. At the same time, Hunan also proposed to carry out car trade-in subsidy activities according to the unified deployment of the state, and give a fixed subsidy to individual consumers who scrap old passenger cars and purchase new passenger cars according to the national unified standards during the activity period.

On April 16, Suzhou released an official account announcing that Suzhou actively responded to the linkage of "trade-in + consumption vouchers" and the convergence of new and old policies, and will officially launch the city's trade-in policy for cars and home appliances on the 20th, with a total subsidy of 120 million yuan. Among them, the total amount of red envelopes for car purchase subsidies reached 100 million yuan, and 50 million yuan each for trade-in and direct new purchases.

It is worth noting that Suzhou has clarified the detailed rules of the model subsidy standard. This time, Suzhou will divide the newly purchased models into new energy vehicles and fuel vehicles, and divide the price of the models, and give different direct subsidies and replacement subsidies according to different price models. For example, consumers who buy new energy vehicles with a price of more than 300,000 yuan will receive a direct new purchase subsidy of 5,000 yuan and a trade-in subsidy of 6,000 yuan, while fuel vehicles will only have a trade-in subsidy, with a subsidy of 3,000 yuan for the range of 100,000-300,000 yuan and a subsidy of 5,000 yuan for more than 300,000 yuan.

At the same time, car companies are also actively following up. A salesperson of Geely Automobile told the "China Times" reporter: "The cash discount for buying the Xingrui 2.0T version is 9,000 yuan, and if you trade in the old for the new, you can enjoy a replacement subsidy of 15,000 yuan on this basis." At the same time, the official website shows that the purchase of this version of the model can also enjoy a limited time (before April 30) 24 periods of 60,000 interest, with an interest discount of up to 6,000 yuan.

According to incomplete statistics from the China Times, in the new round of release promotions in 2024, more than half of the car companies that have released replacement subsidies have already been released. For example, Geely, Chery, Changan, FAW Toyota, Guangqi Honda, etc. have launched replacement subsidies, and China FAW has also officially announced its Hongqi, FAW Jiefang, FAW Besturn, and FAW-Volkswagen, FAW Toyota, FAW Audi and other independent and joint venture brands Trade-in policy, with a maximum bicycle subsidy of 50,000 yuan.

Editor-in-charge: Li Yanan Editor-in-chief: Yu Jianping