Government's Role in Boosting Consumption in the Automotive Sector

Government Initiatives to Boost Consumption

In March, Beijing introduced a new trade-in program aimed at revitalizing sluggish consumption across the automotive sector and other consumer products. This program, supported by government funds, is designed to address overcapacity and stimulate economic activity.

Subsidies and Their Impact

The central government plans to utilize approximately 300 billion yuan ($42.5 billion) in ultra-long-term special government bond funds this year. Local governments are responsible for implementing purchase subsidies, which have been pivotal to the program's success.

Performance During Golden Week

• During last week's National Day holiday, around 2.52 million consumers participated.
• Total sales exceeded 17.83 billion yuan in major appliances alone.
• Most successful categories were air conditioners, refrigerators, and computers.

Boost in Automotive Sector

As of October 7, over 1.27 million subsidy applications for new vehicles were recorded, illustrating the program's impact. The trend indicates a robust interest in new-energy vehicles, accounting for more than 60% of applications.

Local Governments and Innovations

• Local governments have expanded subsidies to include devices like dishwashers, smartphones, and smart toilets.
• In Guangdong cities, subsidies can reach up to 16,000 yuan for new-energy vehicle purchases.

Real Estate Sector Developments

In over 130 cities, housing trade-in policies are also being tested amidst real estate challenges, reflecting the government's broad approach to stimulate multiple sectors.