The Chinese government's changes to its trade-in subsidies for older cars could impact mass-market manufacturers, Bloomberg reported Wednesday.
Under the new scheme, customers purchasing a qualifying new energy vehicle will be eligible for a 12% rebate capped at 20,000 yuan if they trade in an older gasoline or EV model registered before 2019, the Commerce Ministry said Tuesday.
Those trading in an older vehicle for a more fuel-efficient gasoline unit or those upgrading to a newer EV will be eligible for a 6% to 10% rebate capped at 15,000 yuan, the ministry said.
To be eligible for the 20,000 yuan subsidy, a new car would need to cost 166,700 yuan. This would mean consumers have to buy more expensive cars, impacting mass-market makers such as BYD (HKG:1211, SHE:002594), Zhejiang Leapmotor Technology (HKG:9863), and Geely Automobile (HKG:0175), Bloomberg said.
The new rules could also spell an uncertain impact on demand in the auto sector in 2026, according to the news outlet.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)
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