After three years of severe damage from the epidemic, coupled with the weakness of the global economy, the industry is not optimistic about the development of the domestic automobile industry.
I still remember that at the beginning of 2023, many organizations’ forecasts for car sales for that year were basically negative.
However, China’s auto industry has turned the tide and shown encouraging resilience.
Last year, the industry ended with double-digit growth of 12 per cent, with sales breaking the 30 million mark for the first time, a record high.
Despite the gradual economic recovery this year, the weak property market and the wave of layoffs sweeping many industries are suggesting that consumers need to “tighten their belts”.
In order to boost the car market, the national policy support has increased its strength again.
In addition to the annual favorable policy of new energy vehicles going to the countryside, the trade-in policy has also been restarted.
A few days ago, the Ministry of Finance issued the 2024 car trade-in subsidy central government reserve fund budget, with a total amount of 6.
44 billion yuan.
The purpose of this move is to improve the standards of technology, energy consumption and emissions, support the scrapping and renewal of old cars that meet the requirements of the subsidy policy, and further expand automobile consumption.
How much increment can the two-pronged approach of new energy vehicles going to the countryside + trade-in for new ones bring to the automobile industry this year? In March this year, the State Council issued the Action Plan for promoting large-scale equipment upgrading and Consumer goods Trade-in.
In April, the Ministry of Commerce and other seven departments jointly issued the “detailed rules for the implementation of Automobile Trade-in subsidies”, defining the scope, standards and application channels of the subsidies.
According to the detailed rules, fuel passenger cars with emission standards of three or less in scrapped countries, or new energy passenger vehicles registered before April 30, 2018, and individual consumers who buy energy-efficient new cars can enjoy subsidies.
Among them, the purchase of new energy passenger cars will receive a subsidy of 10, 000 yuan, and the purchase of fuel vehicles with engines of 2 liters or less will receive a subsidy of 7000 yuan.
The central and local governments will share the proportion of subsidies by region, including 5:5 in the east, 6:4 in the central part and 7:3 in the west.
Local governments have followed suit.
According to incomplete statistics, nearly 20 provinces and cities have issued supporting programs, including Yunnan, Hunan, Guangdong, Shanxi, Jiangsu and other places.
Combined with the central and local policies, the subsidy of new energy passenger vehicles is higher than that of fuel passenger cars.
Moreover, due to the different effects of local finance and consumption stimulus, there are also slight differences in the policy of trading in clunkers in different places.
For example, Chongqing proposes a subsidy of 2000 yuan for each car with a naked car price of less than 200000 yuan, and 3000 yuan for a subsidy of more than 200000 yuan.
Ningxia stipulates that in terms of replacement and renewal, the maximum subsidy for new energy passenger vehicles is 4000 yuan, and the maximum subsidy for fuel passenger cars is 3000 yuan.
On the other hand, Beijing continues to reward the distribution of used cars, with a reward of 0.
5% if the distribution exceeds 5 million yuan.
Suzhou in Jiangsu Province directly gives out 100 million yuan to subsidize the consumption of red envelopes, of which 50 million yuan is exchanged for new cars and 50 million yuan for direct new purchases.
Thus it can be seen that areas with strong financial resources not only respond to the central government’s trade-in measures, but also continue last year’s car purchase activities to boost car consumption in an all-round way.
Car companies joined in, in addition to the government’s real policy support, car companies also took the initiative to join them.
At present, FAW-Volkswagen, FAW-Toyota, SAIC, Great Wall Motor, Mercedes-Benz, BMW and other car companies have responded to the trade-in policy.
Among them, FAW-Volkswagen subsidies for all models range from 7000 yuan to 19000 yuan.
FAW Toyota launched a 2 billion yuan replacement subsidy program.
and Mercedes-Benz subsidized up to 15000 yuan for users who bought Mercedes-Benz passenger cars.
At the level of financial institutions, relevant loan schemes have also been launched specifically around the trade-in policy.
For example, Dongfeng Motor, Guangzhou Auto Huili and other financial companies have launched “0 down payment” and “0 interest” financial products.
Qingdao Agricultural and Commercial Bank has launched a “trade-in consumer loan”, with a maximum loan of 1 million yuan and a maximum period of five years.
It can be seen that under the guidance of national policy, various forces jointly promote the trade-in of the old for the landing.
At the regular press conference of the National Development and Reform Commission a few days ago, Li Chao, deputy director and spokesman for the Policy Research Office of the National Development and Reform Commission, said that according to incomplete statistics, some household appliance enterprises and automobile enterprises have announced a subsidy scheme worth more than 15 billion yuan.
a number of e-commerce platforms have cooperated with production enterprises to invest more than 10 billion yuan to carry out trade-in promotion activities.
With the trade-in of clunkers in full swing, the policy of new energy vehicles going to the countryside came as expected.
In mid-May, the Ministry of Industry and Information Technology and other five departments issued a notice to organize 2024 activities for new energy vehicles to go to the countryside from May to December 2024.
A total of 99 models were included in the catalogue, including BYD, Xiaopeng, Ian and other brands, an increase of 30 models compared with last year.
Hubei, Hefei and other places responded positively.
Among them, Hefei made it clear that this batch of new energy vehicles to the countryside more than 1100 indicators.
During the event, Hefei will give individual consumers a subsidy of 5000 yuan per car to the countryside.
Hefei solicited 34 models from 11 brands, including BYD, Lulai, Changan, Jianghuai, Chery, Zero and so on.
Who will benefit? The main beneficiaries of the policy of new energy vehicles going to the countryside are very clear-third-and fourth-tier cities and rural areas.
This activity will be widely carried out in rural areas at the county, township and village levels, realizing the further sinking of the market.
In order to better pry into the rural market with more than 500 million motor vehicles, not only more models have been selected this year, but also more categories have been selected, covering low, middle and high-end models such as passenger vehicles (from minicars to B-class vehicles, SUV and off-road vehicles), commercial vehicles, pick-up trucks and other low -, medium-and high-end models, with the increase of economical and applicable models, which are more in line with the diversified vehicle needs in rural areas (more practical, such as dual-use passenger and goods).
At the same time, in order to allay the concerns of rural consumers about “difficulty in charging”, the Ministry of Industry and Information Technology and other five departments specially stressed when issuing notices for new energy vehicles going to the countryside to speed up to make up for the shortcomings of new energy vehicles consumption in rural areas.
China plans to carry out the pilot project of replenishing the deficiency board of county recharging facilities from 2024 to 2026.
During the demonstration period, the pilot counties that achieve the highest goal each year will receive up to 45 million yuan.
This provides impetus for promoting infrastructure construction at the local level.
With the improvement of the charging basis, the worries of rural consumers about buying new energy vehicles will also be eliminated.
In the view of people in the industry, the two major policies of new energy vehicles going to the countryside and exchanging old for new ones complement each other.
Xu Haidong, deputy chief engineer of the China Automobile Association, pointed out that most of the users who really need scrapped cars are in low-line cities and rural areas, and the combination of the two policies is conducive to the development of the rural new energy vehicle market.
Caitong Securities believes that the trade-in of cars is expected to stimulate the demand for replacement of existing vehicles and drive sales growth.
At present, the growth peak of car ownership has passed.
The peak of abolition may have arrived, and it is gradually entering a stage dominated by value-in-exchange purchases.
This “Action Plan” clearly states that the amount of scrap recycling will double by 2027 compared with 2023.
According to analysis by Orient Securities, the compound annual growth rate of my country’s scrap car recycling volume will reach 14% from 2018 to 2021.
It also believes that trade-in will also accelerate the scrapping of old cars.
Especially stimulated by financial subsidies, the demand for scrapping scrapped cars will be released, and the scrapping industry is expected to usher in a development peak.
It can be seen that the combination of trade-in policies and new energy vehicles to the countryside will not only benefit the promotion of new energy vehicles in county areas, but also industries such as dismantling and vehicle recycling are expected to benefit.
How much increase can it bring?, Thanks to the favorable policy of “two-wheel drive”, China’s automobile industry is on the fast lane.
With the help of new energy vehicles going to the countryside, exchanging old ones for new ones, and purchase tax exemptions, this policy combination is destined to add momentum to the auto market.
Cui Dongshu, Secretary-General of the Federation, optimistically estimates that simply “replacing the old with the new” can bring about an increase of millions of vehicles.
The data confirms that this statement is true.
my country’s car ownership has reached 336 million, and last year, 7.
56 million were scrapped, accounting for 2.2%. Under the policy cloud allocation, Gashi Automobile Research Institute predicts that, referring to last year’s scrapped data and combined with this year’s car sales forecast (31 million vehicles), with the help of the old-for-new policy, the number of cars scrapped this year is expected to reach 9.
83 million vehicles, compared with the scrapping policy.
Before the implementation of the policy, there were 1.
43 million vehicles, of which passenger cars accounted for 80%, which coincides with Cui Dongshu’s prediction.
In view of this policy clearly stating that by 2027, the amount of scrap car recycling will be approximately doubled compared with 2023.
Zhao Chenxin, deputy director of the National Development and Reform Commission, said that the demand for replacement and renewal of automobiles is more than one trillion yuan.
Coupled with recycling, the market space is very large.
Orient Securities said that it expects that by 2027, the recycling volume of scrapped cars will reach 9.
44 million, with a recycling ratio of 79%, a compound annual growth rate of 31% compared with 2023.
The activities of new energy vehicles to the countryside also contribute to the growth of the automobile market.
Last year, a total of 69 models were selected for the event, with sales exceeding 3.
2 million units, a year-on-year surge of 1.
23 times.
This year, the activities of new energy vehicles going to the countryside have further deepened, and counties with low promotion rates of new energy vehicles but huge future growth potential have been selected.
The number of selected models has increased significantly and the categories are rich, making it more suitable for car use scenarios in the rural market.
In addition, the price of new energy vehicles is close to or even lower than that of fuel vehicles, which has greatly improved competitiveness and more promising sales growth.
The three-party linkage of “country + local + manufacturer” provides real money to users.
With such a solid automobile consumption stimulus policy, steady growth in the automobile market is inevitable, and it is reasonable that new energy vehicles will accelerate their penetration into rural areas.
Attachment: Provinces and cities that have issued trade-in policies, return to the first electric network home page>.
