Replacing old with new to drive sales of key consumer goods
2024-10-21
According to the National Home Appliance Trade in Data Platform of the Ministry of Commerce, as of October 15th, 20.667 million consumers have applied for and 10.134 million consumers have purchased 14.624 million units of eight major categories of home appliances, enjoying 13.17 billion yuan in central subsidies and driving sales of 69.09 billion yuan. This indicates that as the work of exchanging old for new consumer goods continues to advance, the policy effect is gradually becoming apparent. Since the implementation of the "Action Plan for Promoting Large scale Equipment Renewal and Consumer Goods Trade in" and "Several Measures to Strengthen Support for Large scale Equipment Renewal and Consumer Goods Trade in", the consumption potential has been effectively stimulated, directly driving the rapid growth of sales of key consumer goods such as automobiles, home appliances, and home decoration, effectively driving investment and efficiency growth in related industries, and further enhancing economic development momentum. The effect of boosting the market was remarkable. At the beginning of August, 150 billion yuan of ultra long term special treasury bond funds supporting the trade in of old consumer goods were all distributed to local governments. At the same time, China has significantly increased subsidy standards in key areas, allowing more real gold and silver to directly reach consumers. Driven by a series of policies, the sales of key consumer goods such as automobiles, home appliances, and home decoration have achieved significant growth. With the optimization and implementation of the policy of exchanging old for new consumer goods based on actual conditions in various regions, online platforms have become one of the important channels. One of the highlights of this year's "Double 11" e-commerce shopping festival is the first time that the policy subsidy for exchanging old appliances for new ones has been combined with the "Double 11" discount. Multiple platforms have stated that this is the biggest discount for buying home appliances in recent years. During the "Double 11" e-commerce shopping festival, various platforms not only offer discounted prices for home appliances, but also cover a wider range of product categories. As of now, more than 20 provinces including Beijing, Shanghai, Guangdong, Zhejiang, and Hubei have successively launched home appliance replacement activities on JD.com. On the JD platform, over 8500 home appliances from 8 categories participated in the event. Tmall has jointly invested 6 billion yuan with thousands of brands to actively respond to the trade in policy and further stimulate consumer vitality through the distribution of category coupons and official brand discounts. The relevant person in charge of the household appliance industry of Tiktok E-commerce said that consumers can enjoy subsidies and purchase goods more conveniently through live broadcast, short video and other service scenarios. Since the implementation of the policy of replacing old cars with new ones, the market has been significantly boosted, and the number of applications for subsidies for scrapping and updating cars has accelerated, effectively driving up car sales. According to data released by the China Association of Automobile Manufacturers, in September, the production and sales of new energy vehicles reached 1.307 million and 1.287 million respectively, an increase of 48.8% and 42.3% year-on-year, and the monthly production and sales reached a historic high. Chen Shihua, deputy secretary-general of the China Automobile Association, said that in the third quarter, with the strengthening of subsidies for car scrapping and renewal at the national level, local replacement and renewal policies came into effect in succession, coupled with the introduction of new autumn products by car enterprises, the passenger car market gradually recovered, especially the retail market continued to grow stronger. The latest data released by the Ministry of Commerce shows that since the implementation of the national automobile scrapping and renewal subsidy policy, the number of applications has grown rapidly. As of 24:00 on October 16, the number of applications for automobile scrapping and renewal subsidies in China has exceeded 1.42 million. On October 16th, the number of new subsidy applications exceeded 20000 for the first time. The trade in policy not only provides consumers with real benefits, but also helps businesses and enterprises expand their sales channels. Song Jianwen, General Manager of the Online Development Business Group of Hisense China Marketing Headquarters, introduced that since the implementation of the policy of exchanging old for new consumer goods, the sales of Hisense products have increased by more than double year-on-year only on the JD platform. During this year's National Day holiday, Suning's nationwide store foot traffic increased by over 200% year-on-year, and trade in orders increased by 132% year-on-year. Wen Hua, Deputy Director of the Department of Resource Conservation and Environmental Protection of the National Development and Reform Commission, said that the consumer goods trade in policy also indirectly boosted investment and efficiency growth in related industries. From January to August this year, investment in the consumer goods manufacturing industry increased by 14.9% year-on-year. In August, the added value of consumer goods manufacturing increased by 4.2% year-on-year, and the growth rate continued to accelerate compared to July. From a segmented perspective, in August, the production of household washing machines involved in the policy of strengthening support for consumer goods trade in increased by 7% month on month, the production of smart TVs increased by 6.7% month on month, and the production of household refrigerators increased by 4.7% month on month. Investment, efficiency, and production all achieved rapid growth. Since the implementation of the policy of exchanging old for new consumer goods, various regions have fully exerted their autonomy and creativity, innovated support methods, improved service guarantees, and deeply interpreted policy documents, forming a number of typical experience and practices. At the recent national teleconference on the trade in of consumer goods, Vice Minister of Commerce Sheng Qiuping stated that all regions should strengthen organizational support, adhere to problem oriented and goal oriented approaches, and ensure the effective promotion of the trade in of consumer goods work; We need to accelerate the disbursement and distribution of subsidy funds, so that consumers can enjoy the real benefits as soon as possible; We should take advantage of the peak consumption season of "Golden September and Silver October" to organize various supply and demand matching activities. Beijing adheres to a problem oriented approach and sets a price fluctuation limit to address the price related issues that consumers are concerned about, in order to prevent "price increases before subsidies". At the same time, make full use of platform channels to improve the convenience of citizens' purchases. Lai Xianyu, a member of the Party Group and Deputy Director of the Beijing Municipal Development and Reform Commission, stated that Beijing has scientifically formulated supporting policies, organized nearly a hundred industry associations, platform enterprises, and production and sales enterprises to conduct research and discussions, and identified products with high market attention and high demand for replacement. Data shows that the retail sales of household appliances and audiovisual equipment in Beijing increased by 1.4% year-on-year from January to June, and rose to 8.9% year-on-year from January to August. As an important domestic automobile manufacturing base, Chongqing has planned to build a trillion level intelligent connected new energy vehicle industry cluster in recent years, and the transformation of the automobile industry from "new" to "intelligent" has achieved results. In addition to having advantages in automobile supply, Chongqing's automobile market also has strong consumer demand. Data shows that in 2023, Chongqing will achieve a total retail sales of consumer goods of 1.51 trillion yuan, an increase of 8.6% over the previous year. The implementation of the "two new" policies with increased support has effectively stimulated the vitality of Chongqing's automobile consumption market. According to Gao Jian, Secretary of the Party Group and Director of the Development and Reform Commission of Chongqing, as of September 22, Chongqing has received over 64000 applications for subsidies for scrapped and replaced cars, involving more than 900 million yuan in subsidy funds. The fund leverage ratio for the two policies of scrapping and replacement of automobiles has reached 1:6 and 1:21 respectively, which has a significant effect on driving consumption. In order to implement the national policy of promoting the trade in of consumer goods, Guangdong has launched the "Yuehuanxin" trade in public service platform, and the public can participate in the activity through the WeChat mini program. Set up activity entrances on the homepage of e-commerce platforms such as JD.com, Suning, Taobao, and Tmall, and widely promote them on payment platforms such as WeChat and UnionPay. Ai Xuefeng, Secretary of the Party Group and Director of the Development and Reform Commission of Guangdong Province, introduced that in less than a month after the implementation of the enhanced policy in August, more than 9.3 million people applied for subsidies for exchanging old appliances for new ones, more than 1.45 million household appliances were exchanged for new ones, and nearly 30000 cars were scrapped and replaced. According to the value-added tax invoice data released by the State Administration of Taxation, in the first three quarters of this year, driven by the policy of exchanging old for new consumer goods, retail sales of household audiovisual equipment such as televisions and daily household appliances such as refrigerators increased by 10.2% and 6.5% year-on-year, respectively; Retail sales of furniture and sanitary ware related to home decoration increased by 13.9% and 10.5% year-on-year, respectively. At present, the detailed implementation rules for the trade in of consumer goods have been fully introduced, funds have been fully issued, and policies have been fully launched. The retail sales of passenger cars have rebounded significantly, and the sales of household appliances have shifted from a decline to an increase. We need to increase the implementation of relevant policies and promote a sustained increase in commodity consumption, "said Zheng Zhajie, Director of the National Development and Reform Commission. After the implementation of several measures to support the "two new" initiatives in July, relevant departments have successively formulated and issued supporting regulations for four areas: automobiles, home appliances, electric bicycles, and home decoration, kitchen and bathroom. In addition, all 115 national standards formulated and revised to support the trade in of consumer goods have been approved, of which 30 have been officially released to the public. The release and implementation of national standards will strengthen the safety bottom line, raise the quality line, accelerate the upgrading of traditional consumption, lead the creation of new consumption, and continuously stimulate domestic demand potential through consumption quality improvement and expansion, "said Wang Shengli, Deputy Director of the Quality Supervision Department of the State Administration for Market Regulation. When talking about how to increase the use of the old for new funds for consumer goods, further develop the efficiency of the use of funds, and stimulate consumption vitality, Wenhua said that we should make full use of the policies and strengthen the implementation. Timely improve supporting measures, optimize specific operational processes, and promote the comprehensive implementation of updated policies in relevant fields; Accelerate the review process, improve service quality, and bridge the "last mile" of subsidy payment; Strengthen fund supervision and enhance evaluation effectiveness. (New Society)
Edit：Luo yu Responsible editor：Wang xiao jing
Source：ECONOMIC DAILY
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