How the Chinese Government Promotes Green Car Sales

KatadataOTO – Various countries are now establishing new regulations to encourage car sales and environmentally friendly vehicles or New Energy Vehicles (NEV), whether hybrid or pure electric.

The Chinese government has a policy in the form of trade-in subsidies for cars that can be utilized with several conditions such as vehicle eligibility.

“Gasoline cars (to be traded in) qualify for the subsidy if they were registered on or before June 30, 2013. Diesel and other (cars) must be registered on or before June 30, 2015, and environmentally friendly vehicles before December 31, 2019,” wrote a China Daily report, quoted on Saturday (01/03).

The car trade-in subsidy applies to consumers who want to replace their cars with environmentally friendly vehicles. It can also be used for gasoline-engine cars with a capacity of 2,000 cc or less.

Photo: Carnewschina

It should be noted that the trade-in subsidy rule has actually been in effect since 2024. However, this year, some adjustments have been made.

The subsidy limit has not changed, but the nominal amount is replaced by a percentage according to the price of the car receiving the incentive.

So, the higher the price of the car chosen by the consumer, the larger the nominal subsidy received.

Further explained is the government subsidy scheme that can be enjoyed by the public.

Old vehicle surrender subsidy

• New energy vehicles: 12 percent or a maximum of 20,000 yuan (IDR 47.7 million)
• Gasoline cars: 10 percent or a maximum of 15,000 yuan (IDR 35.8 million)

Trade-in subsidy

• New energy vehicles: 8 percent or a maximum of 15,000 yuan (IDR 35.8 million)
• Gasoline cars: 6 percent or a maximum of 13,000 yuan (IDR 31 million)

To support this program, the Chinese government has disbursed funds of around 62.5 billion yuan (IDR 149.2 trillion).

Photo: Denza

This policy is considered to help stimulate consumer purchasing power while helping to encourage the adoption of environmentally friendly or new energy vehicles.

This incentive regulation could seemingly serve as a reference for Indonesia. Considering that many vehicles on Indonesian roads are older models and likely no longer meet emission standards.

A trade-in incentive scheme could be implemented as an alternative to help boost sales of new cars and NEVs nationally.