From the heart of Beijing to the edges of the global stage, you are at Roundtable.
I'm Niu Honglin.
Have you placed an order with the 2026 Consumer Goods Trade-in Subsidies yet?
From the consumer's perspective, this subsidy feels simple.
Claim a cold, place an order, enjoy the discount.
Behind that simplicity however, sits a complex system coordinating central funding, local execution and, of course, digital platforms as well as real-time verification.
So today, let's dive into the fund subsidy economics.
For this show, I am joined by Steve Hatherly and Fei Fei.
Now pull up a chair and join the conversation.
For people in China, midnight on January the 1st was not just about welcoming the new year.
It's also about a moment of excitement with fingers hovering over screens ready to place orders.
Phones fridges, even electric cars, were all discounted under the country's newly upgraded national subsidy.
Just two weeks in, the crowds are real, the numbers are big, and the energy is high.
How do Chinese consumers spend in the beginning of 2026?
And what's with this new national subsidy?
What's new this time?
Well, how exciting.
I've been waiting for the new announcement coming this year.
What did you buy this time?
You got a fridge.
You got a refrigerator last time.
Yeah, and I'm very happy with that.
And this time we're thinking about replacing our heater at home.
So I've been waiting for the announcement.
So basically, I think pretty much a lot of policies when it comes to these national subsidies is quite similar to what we had in twenty twenty five.
But there are something new happening, for example, in the consumer goods sector for consumers.
These subsidies are now targeting more into smarter and greener products, for example, when it comes to well, your digital devices.
I think a lot of people are thinking about, you know, getting a new smartphone or tablets or pcs.
Considering that yeah, because of you know well, since you have the subsidy, it will be a easier decision to make compared with before.
I would say this is, i mean, of course, it's new again this year, but the story of the subsidy goes back.
It goes back a long time right.
It goes back to 2009 and it started with a government pilot, and the idea then was to promote energy-saving or new energy vehicles in public services across a few selected cities.
But over the years the idea has evolved way beyond cars, and now it's no longer just about giving shoppers discounts.
It's kind of a broader upgrade, a bigger push that uses subsidies now to drive equipment renewal or greener and smarter consumption, like you said.
And it's done in two sectors.
So one is consumer goods and one is non-consumers for non-consumers.
For consumers like you and I, it targets digital and smart products.
Like you said, home appliances, like a new heater for Fei Fei.
Yeah.
Maybe a new car for someone too.
And it's really appealing because for the four personal device categories we're talking about phones tablets, Smart watches or bands and smart glasses.
You know, pretty standard.
The thing that you will need for your daily life, perhaps, or your work.
We see individual consumers who buy products priced below 6,000 Chinese yuan.
That is about 830 U.S. dollars per item.
They can receive a 15 subsidy based on the sale price price.
That is a lot of money if you're considering buying something in these category.
And each person is eligible for one subsidized item per category, which means that you can get four if the four things are from these four different categories.
You can't get four phones and get four discounts on the phones.
They have to be from different categories exactly.
But you can buy like one phone, one smart watch, one pair of smart glasses.
But smart glasses are actually added this year for the first time.
I think the move is.
It actually aims to promote the consumption when it comes to smarter technologies.
And also it helps with this particular technology of smart glasses to get more consumers testing the market, and so on and so forth.
Yeah, they're not really a household item just yet.
What I mean is not everybody has a pair of smart glass.
Yes.
And besides that, there's also a category that I believe Fei-Fei would be very interested in the home appliances.
Yeah refrigerator, washing machines televisions, air conditioners, water heaters something we've been looking at.
But actually compared with the last year 2025, this time there are less product categories covered under the national consumer subsidies.
But Also when it comes to consumers purchasing these products, are also that the substances subsidies only cover level one energy efficiency or water efficient standards, that is, the most eco-friendly options on the market.
So you can see that clearly on a national level, the government is trying to divert consumptions into a more rational and also eco-friendly direction.
The country is paying for you to live a greener lifestyle.
That's a good thing.
And it also happens to cars as well, isn't it?
Yeah, because when it comes to cars, you know new energy vehicles.
Well, like Steve said, the first idea of this national consumer subsidy really is about, you know, encouraging people to buy, encouraging governments to buy new energy vehicles.
And now these subsidies are also targeting passenger cars.
That for those people, for drivers who want to purchase a new energy vehicle car, they can now receive subsidies equal to 12 percent of that vehicle price, capped at 20000 Chinese yuan or about.
I don't know, 2,800 US dollars.
That's a significant discount.
Yes, it is, especially.
And also, it doesn't mean that you can't buy a gasoline car.
It's just the level of subsidy will be much lower compared to EVs.
So for gasoline cars, the subsidy is 10% of the price and capped at 15,000 Chinese yuan.
Yeah, it's kind of the same concept with what they're doing with the appliances, right?
So the level one appliances, those are the ones that are best for the environment.
But level one appliances are often more expensive than level two appliances.
So if you get the discount, if you get the vouchers and you use them to buy a level one appliance, it makes them at least the same price as the level two ones and maybe even sometimes a little bit cheaper.
And over a longer period of time.
With the level one appliances, you're actually going to save more money Because they don't use as much electricity.
So it's better for the long term.
It's just kind of a gentle nudge, if you will, to push people just a little bit to purchase greener products and try to make it just as affordable, if not more affordable.
Yes.
And with all of the public facilities out there, as well as the fact that if you're purchasing a level one appliance, it will significantly save the amount of electricity and water and everything you spend.
So if we're doing the math here, with the subsidy and the fact that the greener lifestyle is also relatively a cheaper lifestyle, it's definitely a push towards greener, a more green society kind of direction.
Yeah, you know, i was thinking about changing our heaters at home and i checked the price.
Um, for right now, under the subsidy scheme, i was able to buy a much smarter, greener level one heater now at a cheaper price, and i can also control that heater on a mobile app.
Well, compared to the older version that we had been looking at for several months, that feature doesn't exist, that like they don't have an app that you can control, like in long distance.
Green and smart yes, so it's a.
It's an easy choice.
Yes, so that's for the consumer sectors.
How about the non-consumer sectors that we mentioned, which are the other major area where the national subsidy goes in?
Well, for non-consumer sectors, i think the general direction is pretty similar.
For example, when it comes to industrial and manufacturing equipment.
They are also encouraging to those greener, low-carbon systems, to energy-saving, emission reduction and environmental protection equipment.
And also when it comes to public transport and commercial vehicles.
Electric city buses.
Cleaner freight trucks are also on the list to get subsidies.
And also when it comes to agriculture and the food systems, like there are also greener options for farm machineries and grain processing equipment that will also get subsidized.
So you can see that it's pretty much in the same direction with the consumer.
Yeah.
And then from the recycling side of things, the goal here is to build What they call a fully integrated eco-friendly system, and they want to do that by expanding collection networks with collection points and transfer stations and sorting centers, and supporting all of that by implementing some nationwide programs, including county level cooperatives.
They also want to include the internet plus recycling businesses.
Which just makes things a whole lot easier for people to know how to recycle their products.
They can use apps to do that.
They can get quotes, perhaps on price quotes, I mean on how much they'll have to pay to have their items picked up, their secondhand things that they want to perhaps recycle, get rid of.
And all of this is to ensure the quality and the safety and, of course, the environmental compliance on everyone's.
Yes, it sounds like a really good plan, except that, if you consider the size of the country and the complicity of the market nowadays, I can get something on the online e-commerce platform.
I can get a refrigerator from a food delivery platform, because now they are also integrating into the retail but instant retail market.
I can also get it from the store next door or a huge mall next door.
So if i want to use this national subsidy, is it hard to get?
Do i have to carefully choose a means to do my purchasing Well?
I think.
First of all, if we're talking about shopping online, I think that's a lot of these purchases will be happening.
It's quite straightforward.
You will find on any of these shopping platforms JDcom Tmall, Taobao that they will have this national consumer subsidy in the color of green, for example on JDcom.
Very, very obvious.
And then you can just tap on that green characters and they'll show you all the products that are subsidized under the scheme and you just follow their instructions.
So then you get like a code, is that correct?
You get a code and you have to um, i use your id to identify that you are the person who gets that specific code, and then that gets sent to you and then you use that code when you're redeeming your, your discount Besides I think it's partly that, but at the same time, because even though this amount of money is issued or is sending out by the country, it is actually carried out by local governments.
So different places would have different ways to deal with it.
They have different ways to hand them out.
And, for example, in the last round, I think it's in Shanxi province you have to first claim the code and then the receiving address of your item that you purchase online should be the place of Shanxi or Shanghai.
Shanxi province or any cities there.
So you cannot really apply for the national subsidy of Shanxi, but to get it in, I don't know Beijing, for example.
And also you have to claim receiving it and also open it up and having some following process after you have got the item.
So to making sure that you are actually purchasing this product, not trying to misuse the system to get some other gains.
I see.
So yes, so if you're in Beijing, if you're a resident of Beijing, the discounts apply to Beijing stores and Beijing delivery.
It's not a nationwide free-for-all for everybody, because if you get one from Beijing and get one from Shanghai amazing amazing, But that's not allowed.
But don't do that because you're depriving the right of people actually living in those places.
Which is why it's not allowed.
Okay, so besides that, any other challenges?
The people who wanted to get subsidies from all the provinces in China?
Well, I guess, from the store's or the seller's point of view, they might raise prices before the subsidies are applied.
So that's not allowed.
And they might even resell vouchers.
That is also not allowed.
So they put policies in place to make sure that that doesn't happen.
They use audit systems to make sure that everybody is doing everything that they're supposed to be doing, both the buyers and the seller.
And also they are trying to adjusting distribution based on past audits and local execution.
So meaning that when it comes to allocate, we're talking about on a national scheme, but that means the funds are allocated to different cities and provinces.
There will be also adjustments when it comes to how much money each city or each province get.
And they are also trying to balance and timely to release funds quarterly while local authorities manage smooth spending across weeks, months and quarters.
Around the globe we see different countries have all tried rolling out different subsidies to make it easier for those who are living in the society having a little bit trouble.
We see, for example, the United States.
They have cash checks and have tax reliefs in a certain period of time to make sure.
But it's never to a specific kind of product, and it's not to a specific lifestyle kind.
Yes.
That's just for you to use how you see fit, I think.
Yes.
And in Japan, we've also seen the kind of special subsidy even for go-to-travel kind of subsidies.
But they have also tried giving certain subsidy for certain consumer goods, but it's a relatively shorter period of time.
And it's very direct to a specific item.
And so here...
By looking at or analyzing China's recent subsidies, including the one we're talking about, the national subsidy, as well as previously, the trade-in subsidy, so that you can trade in your old goods so that get some points or get some money for the new ones.
So these are not only to give people better reason to spend but, more importantly, to spend on greener items and towards a greener lifestyle.
So looking forward to see what are people buying and what I can buy.
What did you say?
After the show.
You mentioned it just a few minutes ago.
You said you were going to get a tablet or?
I'm thinking about a tablet.
Yes, yes.
For pleasure and for work.
