The Chinese government has announced new subsidies to help drive up domestic vehicle sales this year after a slow first quarter, with the aim of also helping to lift overall consumer spending following sluggish domestic economic growth.
China’s domestic vehicle market was estimated to have expanded 6% to 5.4m units in the first three months of 2024 while exports increased 33% to 1.32m.
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As the 2024 Beijing International Automotive Exhibition got under way last week, China’s ministry of commerce said the government was offering a one off subsidy of CNY10,000 (US$1,381) until the end of 2024 for buyers trading in old cars for qualifying new models.
The full subsidy would be available to owners trading in battery powered and hybrid vehicles registered before 2018 and petrol vehicles which do not meet the government’s 2007 emissions standards. Customers trading in newer vehicles would receive CNY7,000.
The incentive programme, including disbursements, would be executed by provincial and municipal governments which would also contribute 40% of the subsidies while the central government provided 60%.
The ministry did not disclose the total budget for the subsidies.
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By GlobalDataLast month the government said it planned to relax loan down payment requirements to help support the domestic vehicle market with consumers expected to able to borrow up to 100% of the price of a vehicle instead of 80%-85%.
