Trade-in program continues to boost consumption with 5 million applications for autos

China's trade-in program targeting automobiles is progressing steadily with policy effects accelerating, as combined auto trade-ins surpassed 5 million units by Monday, said the Ministry of Commerce (MOFCOM) on Tuesday.

Over 2.44 million units were scrapped and renewed while more than 2.59 million were replaced, according to MOFCOM data.

As a key focus of the consumer goods trade-in policy, the vehicle sector has seen substantial growth in car sales in recent months.

In November, domestic retail sales of passenger cars reached 2.423 million units, marking a year-on-year increase of 16.5 percent, representing a growth of 5.2 percentage points compared to October. From January to November, total retail sales of passenger cars stood at 20.257 million units, reflecting a year-on-year increase of 4.7 percent, data from MOFCOM showed.

Meanwhile, other sectors involved in the trade-in programs have also seen growing sales momentum.

Some 29.638 million consumers purchased 45.85 million units across eight major categories of household appliances as of midnight on Friday, generating sales of 201.97 billion yuan ($27.84 billion), according to MOFCOM.

Nationwide, the home appliance trade-in program exceeded 100 billion yuan in sales within 79 days, and it took only 40 additional days to reach 200 billion yuan, underscoring the accelerating momentum of consumption upgrades.

The automotive sector's improvement is poised to strengthen confidence in the manufacturing and service sectors, supporting job stability and income growth, Pan Helin, a member of the Expert Committee for the Information and Communication Economy under the Ministry of Industry and Information Technology, told the Global Times on Tuesday.

From the standpoint of stabilizing the economy and boosting consumption, it also plays a crucial role in reinforcing market confidence among businesses and consumers, delivering a significant stimulus, he added.

China has strengthened its vehicle trade-in policies this year, further refining subsidy guidelines for both passenger and commercial vehicles.

In August, seven Chinese government departments, including the Ministry of Finance and MOFCOM, jointly issued a notice to further promote the replacement of old vehicles.

The notice increased subsidy standards for individual consumers replacing scrapped vehicles, raising the subsidy to 20,000 yuan for purchasing new-energy passenger cars and 15,000 yuan for fuel-powered passenger cars.

Pan noted that trade-in policies steered consumers toward more advanced and environmentally friendly choices, promoting the optimization of consumer goods structures and supporting the development of the recycling industry.