Another Chinese province announces big subsidies to encourage consumption

​China’s Zhejiang province has launched a trade-in subsidy program offering up to 15,000 RMB for new electric vehicle (EV) purchases and 13,000 RMB for gasoline-powered cars. This initiative aligns with national efforts to boost vehicle sales and promote cleaner transportation.​

Nationally, China has extended EV purchase tax exemptions through 2027, with a maximum exemption of 30,000 RMB until the end of 2025, decreasing to 15,000 RMB from 2026 to 2027. Additionally, the central government provides subsidies for new energy vehicles (NEVs), including EVs, plug-in hybrids, and fuel cell vehicles, with amounts varying based on vehicle specifications and battery range.​

Other regions have implemented their own incentives.For example, Shanghai offers financial subsidies and tax deductions to promote NEV adoption.Shenzhen has introduced policies to support the EV industry, including financial support and implementation plans to drive growth.

Zhejiang’s program stands out by providing substantial subsidies for both EVs and gasoline cars, with a higher incentive for EVs, reflecting the province’s commitment to environmental sustainability. This approach not only encourages the adoption of cleaner vehicles but also supports the automotive market by making vehicle upgrades more accessible to consumers.​

These regional initiatives, alongside national policies, aim to stimulate automotive industry growth amidst sluggish auto sales. By offering financial incentives, both central and local governments are working to accelerate the transition to NEVs, reduce emissions, and promote sustainable transportation solutions across China.

This article was written by Eamonn Sheridan at www.forexlive.com.