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South China Morning Post
4 days ago
- Business
- South China Morning Post
Is China's massive trade-in programme running out of steam?
For months, consumers across China buying everything from iPhones to cars and washing machines have enjoyed steep discounts – courtesy of the government. Advertisement This vast subsidy programme has played a key role in boosting China's consumer spending this year, helping the economy remain relatively robust even amid an unprecedented trade war with the United States. But in June, some of those offers suddenly disappeared . In the eastern Jiangsu province, local authorities stopped issuing vouchers for online purchases of home appliances. Around the same time, several other provinces suspended their trade-in programmes for cars and appliances, citing depleted funds. The cancellations were the first sign that a reckoning may be approaching over China's consumption-boosting policies, which have succeeded in their main goals – but come with a hefty price tag. Last week, Beijing reaffirmed its support for the national trade-in scheme for durable goods, pledging that the rest of the 300 billion yuan (US$41.8 billion) funding would be allocated to local governments before the end of the year, with the next two rounds of funding set to be issued in July and October. Advertisement On Thursday, Li Chao, deputy director of the National Development and Reform Commission's Policy Research Office, said the government would formulate monthly and weekly plans to monitor the utilisation of those funds. 'This will ensure the orderly implementation of the consumer goods trade-in policy throughout the year,' she added.
Yahoo
18-06-2025
- Automotive
- Yahoo
Some Chinese cities pause car-buying subsidies as funds run out
SHANGHAI (Reuters) -At least six cities and municipalities across China have suspended trade-in subsidies for car buyers in June, according to Reuters' review of government announcements, which could slow new car sales in the world's second-biggest economy. Notices from governments in Zhengzhou and Luoyang blamed the subsidy pause on the first round of funding allocated by Beijing for the programme running out, while Shenyang and Chongqing said the suspension was due to adjustments to improve capital efficiency. The northwestern region of Xinjiang issued a similar suspension. China's government has leaned on subsidies for big-ticket items, including cars, home appliances and some electronics to get people spending as consumer sentiment in the country remains sluggish amid a prolonged property slump and concerns over wage growth and unemployment. The programmes have been embraced with some enthusiasm. As of May 31, there were more than 4 million applications submitted this year for car-specific trade-in subsidies, according to the country's Ministry of Commerce. Chinese retail sales data for May released earlier this week surprised on the upside with subsidies cited as one reason for the higher-than-expected 6.4% growth. While there has been no official announcement about when more funds from the central government will be released for programmes, China's National Development and Reform Commission and Ministry of Finance have said the subsidies would continue throughout 2025, leading analysts to expect new funds for the third quarter to be made available from July. The subsidy programme has also met with controversy, however, particularly in the auto sector. China's auto industry, the world's largest, has attracted criticism from regulators over a deepening price war that has sapped the sector's profitability. Official media in China's Henan province, where Zhengzhou is the capital, last week reported, citing unnamed sources, that China's central government had taken note of some loopholes in the subsidy schemes and would look to make adjustments. One of the major issues identified by Chinese media and regulators is so-called 'zero-mileage used cars', which refers to the practice of selling brand new cars as heavily discounted second-hand vehicles to get rid of inventory. The report in Henan government-owned newspaper Dahe Daily added that sales of 'zero-mileage used cars' were one of the key factors leading to subsidies being used up ahead of expectations, necessitating the suspensions. Some businesses were disguising new or nearly new cars as used cars that they could trade in to obtain the subsidies, the newspaper said. The People's Daily, a national newspaper that often signals the positions of China's top leaders on a variety of issues, also called for a crackdown on the zero-mileage used cars, weeks after Great Wall Motor's Chairman Wei Jianjun publicly condemned the practice. China's industry ministry in early June summoned automakers to a meeting where it called for the sector to halt its price wars, Reuters reported last week. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
18-06-2025
- Automotive
- Reuters
Some Chinese cities pause car-buying subsidies as funds run out
SHANGHAI, June 18 (Reuters) - At least six cities and municipalities across China have suspended trade-in subsidies for car buyers in June, according to Reuters' review of government announcements, which could slow new car sales in the world's second-biggest economy. Notices from governments in Zhengzhou and Luoyang blamed the subsidy pause on the first round of funding allocated by Beijing for the programme running out, while Shenyang and Chongqing said the suspension was due to adjustments to improve capital efficiency. The northwestern region of Xinjiang issued a similar suspension. China's government has leaned on subsidies for big-ticket items, including cars, home appliances and some electronics to get people spending as consumer sentiment in the country remains sluggish amid a prolonged property slump and concerns over wage growth and unemployment. The programmes have been embraced with some enthusiasm. As of May 31, there were more than 4 million applications submitted this year for car-specific trade-in subsidies, according to the country's Ministry of Commerce. Chinese retail sales data for May released earlier this week surprised on the upside with subsidies cited as one reason for the higher-than-expected 6.4% growth. While there has been no official announcement about when more funds from the central government will be released for programmes, China's National Development and Reform Commission and Ministry of Finance have said the subsidies would continue throughout 2025, leading analysts to expect new funds for the third quarter to be made available from July. The subsidy programme has also met with controversy, however, particularly in the auto sector. China's auto industry, the world's largest, has attracted criticism from regulators over a deepening price war that has sapped the sector's profitability. Official media in China's Henan province, where Zhengzhou is the capital, last week reported, citing unnamed sources, that China's central government had taken note of some loopholes in the subsidy schemes and would look to make adjustments. One of the major issues identified by Chinese media and regulators is so-called 'zero-mileage used cars', which refers to the practice of selling brand new cars as heavily discounted second-hand vehicles to get rid of inventory. The report in Henan government-owned newspaper Dahe Daily added that sales of 'zero-mileage used cars' were one of the key factors leading to subsidies being used up ahead of expectations, necessitating the suspensions. Some businesses were disguising new or nearly new cars as used cars that they could trade in to obtain the subsidies, the newspaper said. The People's Daily, a national newspaper that often signals the positions of China's top leaders on a variety of issues, also called for a crackdown on the zero-mileage used cars, weeks after Great Wall Motor's ( opens new tab Chairman Wei Jianjun publicly condemned the practice. China's industry ministry in early June summoned automakers to a meeting where it called for the sector to halt its price wars, Reuters reported last week.
South China Morning Post
28-05-2025
- Business
- South China Morning Post
China releases plan aimed at upgrading IT manufacturers, boosting self-sufficiency
China has unveiled a detailed plan to upgrade its information technology (IT) manufacturers as it doubles down on achieving self-sufficiency in technologies including semiconductors, batteries, satellite navigation and artificial intelligence (AI), and sidestepping US tech curbs. Advertisement The 18-point action plan calls for the deepening of AI integration and the fostering of a new class of industry service providers by 2027. It aims to see more than 85 per cent of manufacturers using computer numerical control – in which computer programs automate machining – in key processes in the next two years, and to cultivate at least 100 specialised service providers for the sector. By 2030, China aims to have completed a core industrial database that will allow its IT manufacturers to achieve 'new breakthroughs' and scale the 'high end of the global value chain'. The blueprint was released on Tuesday by the Ministry of Industry and Information Technology, the National Development and Reform Commission and the National Data Administration, amid the closing phase of the 'Made in China 2025' initiative. Advertisement IT manufacturing forms the backbone of China's industrial system, spanning upstream materials like monocrystalline and polycrystalline silicon, midstream component manufacturing, and downstream applications in electronics and automotive systems.
