Trade-in scheme boosts home appliance sales by over 200b yuan, shores up consumer spending

Sales revenues of home appliances under the policy-backed trade-in program reached 201.97 billion yuan ($28.11 billion) as of Friday and green products have become the favorite products for consumers, data from the Ministry of Commerce (MOFCOM) showed on Saturday.

Chinese e-commerce company JD.com has highlighted brisk home appliances sales amid the boost from the trade-in scheme and a slew of supportive measures to shore up retail sales.

A total of 29.64 million consumers have enjoyed subsidies for their home appliance purchases, lifting the sales volume by 45.85 million units, according to a statement MOFCOM sent to the Global Times.

It took 79 days for the revenue data to reach the 100 billion yuan mark but the time needed for reaching 200 billion yuan was just 40 days, according to the ministry, highlighting the momentum.

Products with the highest energy efficiency level contributed to over 90 percent of the sales revenue, MOFCOM data showed.

China's e-commerce logistics index, an indicator of logistics operations in the e-commerce sector, registered 115.5 points in November, up 0.5 points from the previous month and the highest level in seven years, according to the China Federation of Logistics and Purchasing on Sunday.

Chinese e-commerce platform JD.com said in a statement sent to the Global Times on Sunday that it witnessed brisk sales for related items during the Double 11 online shopping festival last month.

"Large-size panel TVs became the primary trade-in choice for consumers in rural areas," the company said. A total of 519 home appliances items, including robotic vacuum cleaners and dryers, saw their transaction volumes growing by 200 percent during the shopping festival, it noted, adding that for AI-powered computers and smartphones, the transaction volumes were up 100 percent from the previous year.

"I am looking at upgrading my router and I found JD provided access to the trade-in program. I am quite delighted to be able to save on some costs but also enjoy the service - someone will pick up the old gadget from my home," a Beijing-based consumer surnamed Yang told the Global Times on Sunday.

The home appliance trade-in program is part of China's efforts to boost domestic demand and support economic growth. Officials estimate the upgrading drive will create market demand worth over 1 trillion yuan.

Zhou Maohua, an economist at China Everbright Bank, told the Global Times on Sunday that the trade-in policy has had a marked boosting effect for domestic consumption and industries.

"Together with supportive policies for equipment upgrades, the policy has effectively boosted domestic circulation and improved people's livelihoods, underpinning industrial upgrade and green development," Zhou said. "It is expected that the scope and intensity of these policies will continue into next year."

In October, key economic indicators in consumption, services, and trade showed marked improvement. During the month, the total retail sales of consumer goods reached 4.54 trillion yuan, up by 4.8 percent year-on-year, 1.6 percentage points faster than last month, data from the National Bureau of Statistics showed on November 15.

The State Council, China's cabinet, released an action plan in March to initiate large-scale equipment upgrades and trade-ins of consumer goods - nearly 15 years since the last such round of renewals.