✎ Editor's note
Recently, the national and local levels have successively introduced car trade-in policies, and auto companies have also followed suit to share the dividends of the policy package. Under the guidance of the government, the market-oriented, automobile trade-in action will greatly release the potential of automobile consumption, promote the quality and upgrading of the automobile industry, and have a far-reaching impact on the new round of development of the automobile industry. Focusing on this round of trade-in, "Auto Vertical" has made a special report on this issue of "Cover Story". There are a total of 5 articles in this special report, and the fifth article will be released today, so stay tuned.
With the further implementation of the trade-in policy, the circulation of second-hand cars will become more standardized and diversified, which will continue to help the transaction volume of the second-hand car market in mainland China to rise steadily.
In the automotive market, the used car market acts as a reservoir. According to the data, the number of cars in mainland China has reached 340 million, ranking first in the world. From 2019 to 2023, the annual second-hand car transaction volume in mainland China will increase from 14.9228 million to 18.4133 million, and the cumulative transaction value will increase from 935.686 billion yuan to 1179.532 billion yuan, and the scale of the second-hand car market will show an overall upward trend. On March 7, the State Council issued the Action Plan for Promoting Large-scale Equipment Renewal and Trade-in of Consumer Goods. The plan proposes to carry out the trade-in of old cars, increase policy support, smooth circulation blockages, and promote automobile cascade consumption and renewal consumption; Strictly implement the mandatory scrapping standards for motor vehicles and vehicle safety and environmental protection inspection standards, and eliminate old cars that meet the mandatory scrapping standards in accordance with laws and regulations. In terms of the implementation of recycling and recycling actions, the plan points out that it is necessary to optimize the layout of scrapped automobile recycling and dismantling enterprises and promote the door-to-door car pick-up service model; Continue to optimize the registration management of second-hand car transactions to facilitate transactions; vigorously develop the second-hand car export business; Promote remanufacturing and cascade utilization in an orderly manner, and promote high-level recycling of resources. On March 27, 14 departments, including the Ministry of Commerce, the National Development and Reform Commission, and the Ministry of Industry and Information Technology, issued the "Action Plan for Promoting the Trade-in of Consumer Goods". The plan points out that in terms of second-hand cars, we will highlight the standard traction in the automotive field, improve the recycling and dismantling system of scrapped vehicles, promote the safe and convenient transaction of second-hand cars, and cultivate and expand the main body of second-hand car business. On April 26, the Ministry of Commerce, the Ministry of Finance and other 7 departments issued the "Implementation Rules for Car Trade-in Subsidy". The detailed rules elaborate on the implementation plan of the trade-in from the aspects of "subsidy scope and standards", "subsidy declaration, review and distribution", "subsidy fund management" and "supervision and management". Under the guidance of the above policies, all provinces, autonomous regions and municipalities directly under the central government have successively issued relevant policies for trade-in, including many related content of the second-hand car industry.
Promote the safe and convenient transaction of used cars
While the mainland second-hand car market is developing rapidly, there are also various non-standard and inconvenient operation models, such as accident cars, soaking cars, refurbished cars, etc. from time to time into the market, and there are circulation barriers between provinces and cities, which not only damage the interests of consumers, affect consumers' car buying experience and confidence, but also hinder the healthy development of the second-hand car market. The Action Plan for Promoting the Trade-in of Consumer Goods clearly states that by 2027, the trading volume of second-hand cars in mainland China will increase by 45% compared with 2023, and a standardized and convenient second-hand car trading platform is the basis for achieving this goal. The "Action Plan for Promoting the Trade-in of Consumer Goods" proposes to promote the safe and convenient transaction of second-hand cars, continue to implement facilitation measures such as "reverse invoicing" of second-hand car sales and registration of off-site transactions, and break down all kinds of invisible obstacles. Give full play to the advantages of the second-hand car trading platform directly connecting buyers and sellers, and promote the reduction of links, costs and efficiency of second-hand car transactions. Promote the open use of non-confidential and non-private information in the automotive field, improve the operation quality and efficiency of independent third-party second-hand car information query platforms, support the construction of new energy second-hand car power battery testing and valuation platforms, and guide second-hand car dealers to provide and display vehicle condition sheets, clearly indicating the basic information, important configurations, prices and other contents of the vehicle. To this end, local governments have come up with various solutions tailored to local conditions. For example, Jiangsu proposes to implement the policy of cross-provincial and one-network registration of small non-operating second-hand car transactions; Strengthen the construction and application of automobile circulation information service (second-hand car) system, and encourage qualified areas to build centralized and standardized second-hand commodity trading markets. Hainan has carried out actions to improve the service of the second-hand car trading market, improved market equipment and facilities, and provided second-hand car display, evaluation, finishing, financial and other services; The public security traffic management department has set up service stations in the second-hand car trading market to facilitate consumers to handle second-hand vehicle transfer registration and other businesses. At the same time, the "Action Plan for Promoting the Trade-in of Consumer Goods" proposes to cultivate and expand the main body of second-hand car business. Support the sale of second-hand cars from brokerage to distribution, encourage automobile manufacturers to carry out second-hand car replacement, manufacturer certification and other businesses, encourage second-hand car dealers to provide vehicle warranty services, encourage local governments to carry out second-hand car dealership management by classification and classification, and promote the branding and large-scale development of second-hand cars. Beijing mentioned that enterprises are encouraged to establish a "one-stop" service platform for car trade-in, which integrates second-hand car recycling, new car sales, old car scrapping, financial services, and capital equity subsidies, so as to provide consumers with a simpler and more convenient second-hand car recycling service experience; Hubei proposed to cultivate and expand a number of leading second-hand car enterprises. Guizhou will strengthen the construction of the integrity system of second-hand car trading, and cultivate 15 provincial-level second-hand car trading demonstration enterprises by 2027.
Improve the quality and ability of used car exports
In 2023, the export volume of used cars in mainland China will exceed 100,000 units, sounding the clarion call for the comprehensive export of used cars. However, in terms of quantity, the scale of mainland second-hand car exports is still very small, compared with the overall export scale of 4.91 million vehicles, only a handful of 2%, and most of them are still zero-kilometer parallel export cars. The Action Plan for Promoting the Trade-in of Consumer Goods points out that it is necessary to implement the second-hand car export management measures, improve the quality of second-hand car exports, enhance the international operation capabilities of second-hand car export enterprises, and support them to continue to expand overseas markets. In this context, Hainan, Shandong, Guangdong, Heilongjiang, Shaanxi, Hunan and other places have successively issued relevant guidance. For example, Hainan proposed that it should support powerful second-hand car export enterprises to establish an international marketing network in accordance with laws and regulations; Tianjin will further optimize the second-hand car export license process, support powerful enterprises to carry out second-hand car export business, and build a second-hand car export base and international marketing network. Sichuan should support eligible enterprises to apply for second-hand car export qualifications and do a good job in the filing and review of second-hand car exports; Shanxi will establish a special working mechanism for the export of second-hand cars; Heilongjiang encourages the export of second-hand cars to Russia; For key markets such as Central Asia and ASEAN, Shandong will make every effort to expand the export business of second-hand cars and steadily expand the scale of second-hand car exports. In addition, Guangdong will also vigorously develop the second-hand car export business, encourage qualified cities to build a second-hand car export base integrating display and trading, maintenance and maintenance, testing and certification, customs declaration and export, warehousing and logistics, financial services and other functions, and cultivate a second-hand car export supporting service system; Guizhou will continue to develop the second-hand car export business by promoting the pilot experience of Guiyang's second-hand car export.
Improve the recycling and dismantling system of scrapped vehicles
The Action Plan for Promoting the Trade-in of Consumer Goods points out that by 2025, the recycling volume of end-of-life vehicles will increase by 50% compared to 2023, and by 2027, the recycling volume of end-of-life vehicles will double that of 2023. So, where do end-of-life vehicles go from here? The "Action Plan for Promoting the Trade-in of Consumer Goods" gives guidance: it is necessary to guide enterprises to improve the level of recycling services, facilitate the delivery of car owners, and promote the door-to-door car collection service model. Optimize the industrial layout of scrapped vehicle recycling and dismantling according to local conditions, include eligible key projects for resource recycling into the scope of support such as investment in the central budget, encourage scrapped vehicle recycling and dismantling enterprises to improve the level of high-value comprehensive utilization of resources, and extend and expand to downstream steel, non-ferrous metals, parts remanufacturing and other industrial chains, and support enterprises to become bigger and stronger. Standardize the business behavior of scrapped vehicle recycling and dismantling enterprises, investigate and punish illegal dismantling and other illegal acts in accordance with the law, and effectively prevent safety and environmental protection risks. In this regard, Jiangsu, Heilongjiang, Sichuan, Hunan, Qinghai, Inner Mongolia, Zhejiang, Fujian and other places have issued corresponding guiding policies. For example, Jiangsu will gradually build a standardized battery recycling system with battery manufacturing enterprises and third-party recyclers as the main body; improve the level of remanufacturing of auto parts; promote the safe cascade utilization of waste power batteries; Sichuan will support power battery companies to cooperate with foreign battery recycling leading enterprises to jointly build overseas battery recycling bases to achieve local dismantling, local sales and local utilization. Heilongjiang will continue to optimize the layout of scrapped automobile recycling and dismantling enterprises, and strengthen the supervision and management of scrapped automobile recycling and dismantling activities; Ningxia will continue to explore the establishment of a recycling network and management system for scrapped vehicles and waste parts by manufacturers through independent recycling, commissioned recycling or joint recycling. Hunan will support qualified enterprises to enter the scrapped motor vehicle recycling and dismantling market, improve the industrial layout, support qualified scrapped motor vehicle recycling and dismantling projects to apply for relevant funds in the field of equipment renovation and transformation, and guide local governments to coordinate and ensure the demand for reasonable land use; Qinghai will strengthen the management of scrapped motor vehicle recycling and dismantling qualifications, and support Xining City to optimize the layout of scrapped motor vehicle recycling and dismantling enterprises. It is worth mentioning that some provinces and cities have also smelled a glimmer of business opportunities in this field. Hainan will speed up the implementation of the "Hainan Provincial Renewable Resources Recycling Industry Development Plan (2021~2025)", optimize the layout of scrapped motor vehicle recycling and dismantling projects in the province, adjust and increase construction projects in a timely manner in combination with the actual situation, and accelerate the construction of scrapped motor vehicle recycling and dismantling projects in Haikou, Sanya, Wenchang, Lingao and other cities and counties. Inner Mongolia proposed to undertake the transfer and development of the recycling industry. The relevant departments of the autonomous region, together with Hohhot, Baotou, Chifeng, Xilin Gol League, Ulanqab and other relevant league cities, will actively integrate into the coordinated development of Beijing-Tianjin-Hebei, undertake the recycling industry of waste materials such as scrapped automobiles and waste household appliances, explore a new model of counterpart cooperation and development between Inner Mongolia and Beijing, cultivate and introduce relevant enterprises, and promote the development of the recycling industry in the autonomous region. Of course, the promulgation of the trade-in policy of the State Council, ministries and local governments also has a far-reaching impact on the mainland second-hand car market in terms of cascade utilization, industry standards, information security and other aspects. Pang Tianshu, deputy director of the production and research department of the China Association of Automobile Manufacturers and deputy secretary-general of the new energy vehicle special committee, said in an interview with the automobile vertical and horizontal media that from the perspective of the second-hand car market, the "detailed rules for the implementation of the car trade-in subsidy" will speed up the scrapping of the national three and below standard cars, and the "action plan to promote large-scale equipment renewal and consumer goods trade-in" and "action plan to promote the trade-in of consumer goods" will systematically standardize all processes and links including second-hand car recycling, trading and scrapping. With the further implementation of the car trade-in policy, the transaction volume of the mainland second-hand car market will rise steadily. Note: This article was first published in the June 2024 issue of Auto Magazine in the "Cover Story" column, so stay tuned. Related Reports:
Cover Story 1: Car Trade-in: Unleash Potential, Improve Quality and Upgrade
Cover story (2): The most complete car trade-in policy on the whole network is sorted out! Are you ready for a new car this year?
Cover Story (3): Can Independent Car Companies Become the Biggest Winners of "Trade-in"?
Cover Story (4): Foreign-funded joint venture car companies respond to the trade-in B-side
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Article: Car Vertical
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