The 2026 Chinese trade-in subsidy policy takes effect as consumers shop for smartphones in malls. (Photo/Sun Lei)
Chongqing - China’s trade-in subsidy program has been underway for over two weeks, with 62.5 billion yuan (about 8.97 billion U.S. dollars) in initial central funding to boost upgrades to greener, smarter products.
The policy covers three major categories: automobiles, including new energy vehicles (NEVs) and gasoline passenger cars with engines of 2.0 liters or less; home appliances such as energy-efficient refrigerators; and digital products like smartphones, tablets and smartwatches.
March 2024 marked a key milestone in the rollout of the policy. The trade-in subsidy scheme shifted from regional pilots to a nationwide program, jointly funded by central and local governments.
This year, the central government will cover the highest proportion of subsidies in western regions, up to 95%, followed by 90% in the central areas and 85% in eastern regions, ensuring the policy accounts for regional development differences.
According to various policy documents from Chinese authorities, the national trade-in policy will allocate central funds in quarterly batches. Everbright Securities estimates the total central support fund for 2026 will reach 250 billion yuan, down from 300 billion yuan in 2025. The current round of subsidies will focus more on high-impact consumer goods, such as NEVs.
The core goal of the policy is to stimulate bulk consumption and ease downward economic pressure. The Ministry of Commerce reported that in 2025, the sales of goods under the trade-in scheme exceeded 2.6 trillion yuan, benefiting 360 million people.
The policy has a multiplier effect. According to Everbright Securities, the 250-billion-yuan subsidy in 2026 could drive an additional 625 billion yuan in consumption, contributing to a 1.2% increase in total retail sales of consumer goods.
The policy has sparked strong consumer interest in Chongqing. On Jan. 13, a Bridging News reporter visiting shopping districts and stores selling home appliances and digital products found trade-in promotions widely advertised.
Public enthusiasm for exchanging products was high. A representative from the JD MALL in Chongqing Liangjiang New Area revealed that after the policy was launched, foot traffic increased by 110% compared to the previous month, and sales doubled, with green, smart home appliances becoming the mainstream, accounting for 65% of total sales, far exceeding the same period last year.
According to data from the Chongqing Municipal Commission of Commerce, market demand has been strong. By January 11, the total number of transactions for home appliance exchanges and purchases reached 60,870, with subsidies amounting to about 46 million yuan, directly driving sales of 324.6 million yuan.
The digital and smart product sector has also seen a surge in exchanges. As of January 11, 61,990 transactions for digital and smart products had been completed, with subsidies totaling about 25 million yuan, driving sales of 206.7 million yuan.
Notably, this year, smart glasses were added to the trade-in program, attracting a broader consumer base. The manager of a Xiaomi store in Chongqing shared that during the New Year period, sales of smart glasses and wristbands doubled compared to last year, with many consumers purchasing wearable devices for the first time thanks to the subsidies.