Exclusive article by China's well-off network
Text: "Xiaokang", reporter of China's well-off network, Liu Jianhua
High-quality supply will stimulate new demand and create a broader market space.
On March 13, the State Council issued the "Action Plan for Promoting Large-scale Equipment Renewal and Trade-in of Consumer Goods" (hereinafter referred to as the "Action Plan").
The Central Economic Work Conference held as early as December last year and the Fourth Meeting of the Central Financial and Economic Commission held in February this year both made arrangements for "large-scale equipment renewal and trade-in of consumer goods", and the executive meeting of the State Council held on March 1 made detailed arrangements for this.
Zheng Shajie, director of the National Development and Reform Commission, said at the economic theme press conference held at the second session of the 14th National People's Congress that the scale of equipment investment in key areas such as industry and agriculture in the mainland in 2023 will be about 4.9 trillion yuan, and with the in-depth promotion of high-quality development, the demand for equipment renewal will continue to expand, and the preliminary estimate will be a huge market with an annual scale of more than 5 trillion yuan.
New opportunities 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. Photo / Rice Grains
Create a broad market space
Consumption is the ultimate goal of all production, the end of the economic cycle, and a new starting point. According to the National Bureau of Statistics, the total retail sales of consumer goods in mainland China will grow by 7.2% in 2023, and the contribution rate of final consumption expenditure to economic growth will reach 82.5%.
The "Action Plan" makes it clear that it will coordinate the expansion of domestic demand and deepen the supply-side structural reform, implement four major actions: equipment renewal, consumer goods trade-in, recycling and recycling, and standard improvement, vigorously promote the production and application of advanced equipment, promote the continuous increase in the proportion of advanced production capacity, and promote more high-quality durable consumer goods into people's lives.
Among them, the implementation of equipment renewal actions will promote the renewal and transformation of equipment in key industries, accelerate the renewal of construction and municipal infrastructure equipment, support the renewal of transportation equipment and old agricultural machinery, and improve the level of education, cultural tourism and medical equipment. Among them, the implementation of consumer goods trade-in action, will carry out the trade-in of automobiles, home appliances, home improvement consumer goods, etc.
Specifically, organize and carry out national car trade-in promotional activities, and encourage automobile manufacturers and sales enterprises to carry out promotional activities. Strictly implement the mandatory scrapping standards for motor vehicles and vehicle safety and environmental protection inspection standards, and eliminate old cars that meet the mandatory scrapping standards in accordance with laws and regulations. Support home appliance sales enterprises to carry out trade-in promotional activities with production enterprises and recycling enterprises, open online and offline home appliance trade-in zones, and give preferential treatment to consumers who exchange old household appliances for energy-saving household appliances. Through various methods such as government support and corporate concessions, we will support residents to carry out local renovations such as old house decoration and kitchen and bathroom, continue to promote the transformation of homes for the elderly, and actively cultivate new consumption such as smart homes.
"This round of renewal reflects the new macroeconomic policy idea of 'generating increments from stocks'." Chen Lifen, a researcher at the Institute of Market Economy of the Development Research Center of the State Council, said that the current mainland economy has shifted from a high-speed growth stage to a high-quality development stage, and is in a critical period of transforming the development mode, optimizing the economic structure, and transforming the growth momentum.
Chen Lifen said that renewal can not only "generate increments from stock", but also unify investment and consumption; It is not to stimulate investment or consumption in isolation, but to take a long-term view, smooth the cycle from production to consumption, realize the policy effect of "1+1>2", and reflect the systematic expansion of domestic demand.
Zheng Shajie, director of the National Development and Reform Commission, said that last year, China's industry, agriculture and other key areas of equipment investment scale of about 4.9 trillion yuan, with the in-depth promotion of high-quality development, equipment renewal demand will continue to expand, the preliminary estimate will be a huge market with an annual scale of more than 5 trillion yuan. Looking at consumer durables, at the end of last year, the number of civilian cars in China reached 336 million, and the number of household appliances in major categories such as refrigerators, washing machines, and air conditioners exceeded 3 billion.
High-quality supply will also stimulate new demand and create a broader market space.
The central, local and enterprise linkage efforts
The Action Plan encourages and promotes the trade-in of consumer goods, and boosts bulk consumption such as intelligent networked new energy vehicles and electronic products. Focusing on the home appliance industry, Zhou Yunjie, a deputy to the National People's Congress and chairman of Haier Group, said that for enterprises, "exchanging the old for the new" is a very good opportunity, which 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. At the same time, it will effectively promote the upgrading of industrial technology. With the increasingly intelligent and green demand of users for home appliances, especially in the context of the rapid application of artificial intelligence and other technologies, the new needs of users are accelerating the layout of enterprises in artificial intelligence, chips and other technical fields, and effectively accelerating the development of future industries. The trade-in of household appliances will accelerate the development of the circular economy and provide new opportunities for the green transformation of the entire industry.
Dong Mingzhu, a representative of the National People's Congress and chairman of Gree Electric Appliances, believes that compared with the "old for new" activities in 2009, which mainly focused on household appliances going to the countryside, the "old for new" has been upgraded from solving the problem of "whether it is good or not", which is a good opportunity for home appliance enterprises to accelerate the development of new quality productivity. In this context, combined with the experience of enterprises and the current situation of the industry, Dong Mingzhu proposed to establish mandatory standards for the safe service life of household appliances as soon as possible and suggestions for household appliance enterprises to independently bear the trade-in subsidies.
In addition, Dong Mingzhu also suggested that enterprises should be made clear that they should independently bear the responsibility of replacing the old with the new, and cancel excessive government subsidies. At the same time, regulate the second-hand home appliance market, establish and improve the recycling system of waste household appliances, and strengthen supervision and evaluation to improve consumer participation.
In the whole "trade-in" process, Midea provides professional one-stop full-process recycling services. When consumers participate in the event, Midea will arrange a professional team to disassemble the old home appliances to ensure that the disassembly process is safe and efficient. Subsequently, these waste appliances will be sent to Midea's professional factories for dismantling and recycling. In the dismantling process, Midea pays attention to the high conversion rate of material utilization, and recycles and reuses the valuable materials in waste household appliances as much as possible to maximize the utilization of resources. It can be said that Midea's "trade-in" has fully realized the high-value recycling of resources, and the results have been remarkable, which is not only conducive to improving the living environment of families, but also effectively reducing the pollution of waste household appliances to the environment.
Jiang Li, a researcher at the Institute of Regional Development of the Guangzhou Academy of Social Sciences and the Guangzhou Institute of Urban Strategy, said that Guangdong, as the largest province in automobile manufacturing and consumption in the country, has outstanding advantages and broad space for the implementation of the trade-in action. "Whether in the supply of automobiles or on the demand side, Guangdong has incomparable advantages." She pointed out that Guangdong's automobile output has ranked first in the country for six consecutive years since 2017, and the automobile output in 2023 will be 5.1919 million, including 2.5318 million new energy vehicles, both of which are the first in the country. On the demand side, Guangdong's car ownership also ranks among the top in the country, with about 30 million cars in 2023.
Up to now, many places, including Shanghai and Shenzhen, have responded quickly and successively issued a new round of fuel vehicle trade-in subsidy policies and new energy vehicle replacement policies. Taking Shanghai as an example, on March 4, the Shanghai Municipal Commission of Commerce issued a new round of fuel vehicle trade-in subsidy policy and new energy vehicle replacement policy, which can apply for a one-time car purchase subsidy of up to 10,000 yuan.
On March 11, Luohu District, Shenzhen, launched a four-level car purchase subsidy policy, with a subsidy of up to 9,000 yuan for trade-in. In terms of diesel truck elimination and scrap subsidies, many places have also introduced a subsidy plan for the elimination of scrapped diesel trucks with emission standards of China III and below, of which Hefei City has a maximum subsidy of 32,000 yuan for diesel trucks operating under emission standards of China III and below.
At the same time, a number of car brands have also launched "trade-in" promotions in advance. On March 11, Dongfeng Motor announced that its brands took the lead in launching a nationwide car trade-in action, covering more than 50 of its models, and the replacement subsidy is expected to exceed 10 billion yuan; Chery also officially announced that it officially launched a subsidy replacement season activity of 10 billion yuan. According to different models, the subsidy amount ranges from 3,000 ~ 40,000 yuan; FAW-Volkswagen has launched a down payment policy for old car replacement, such as buying FAW-Volkswagen brand models for less than 5 years and hoping to replace FAW-Volkswagen's new cars, they will have the opportunity to receive old car down payment and other manufacturer subsidies.
Statistics show that up to now, more than 20 auto brands, including Chery Group, Geely Automobile, FAW-Volkswagen, Great Wall Motor, BYD, Beijing Hyundai, VOYAH Automobile, etc., have launched trade-in subsidy policies.
Some analysts believe that compared with the previous central financial subsidy trade-in policy, the outstanding feature of this round of trade-in policy is that the central finance and local finance are linked; The linkage between the central and local fiscal policies and the linkage between fiscal and financial policies fully reflects the unified and coordinated efforts of industry, fiscal, financial, investment, land use and even employment policies, and is the most comprehensive and systematic policy in China in recent times.
("Xiaokang", exclusive article of China's well-off network)
This article was published in the late April 2024 issue of Xiaokang