Consumer goods to gain solid footing

China's home appliances and consumer electronics sector is expected to show strong growth momentum this year, fueled by the country's latest measures to expand the scope of its consumer goods trade-in program amid a broader drive to boost domestic demand and spur economic growth, experts said.

They said that the expansion of the trade-in program, including new subsidies for electronic product trade-ins, as well as the increased number of categories for home appliances, will further stimulate consumer appetite for spending and bolster a recovery in consumption.

China's large-scale equipment upgrade and consumer goods trade-in program, which kicked off last March, yielded fruitful results in 2024, driving strong growth in consumption.

Data from the National Development and Reform Commission showed that more than 37 million consumers purchased over 62 million home appliances last year, with total sales reaching 270 billion yuan ($37.2 billion). Products with the highest level of energy efficiency accounted for over 90 percent of the total sales revenue.

China announced in January a raft of measures to expand the scope of consumer goods in the trade-in program. Under the expanded program, the categories of home appliances eligible for government subsidies have been increased from eight in 2024 to 12 this year. Microwaves, water purifiers, dishwashers and rice cookers have been added to the trade-in list for home appliances.

Consumers can also enjoy subsidies of up to 500 yuan apiece when purchasing digital products like mobile phones, tablets, smartwatches and wristbands.

Guo Meide, president of Beijing-based market consultancy All View Cloud, said the expanded consumer goods trade-in program will not only unleash consumption potential for home appliances and consumer electronic devices, but also drive technological advancement and product upgrades, as well as promote the green and intelligent transformation of traditional industries.

The "old-for-new" program, he added, is conducive to weeding out consumer goods with high energy consumption and declining performance, promoting the popularization of green and energy-saving home appliances, and improving people's quality of life.

According to a report released by AVC, environmentally friendly and energy-saving home appliance products, such as air conditioners and gas stoves, are increasingly favored by Chinese consumers, while the sales of intelligent household appliances that integrate artificial intelligence-powered large language models have witnessed robust growth.

AVC estimated that sales of home appliances in China reached 907.1 billion yuan last year, up 6.4 percent year-on-year, hitting a record high, while the figure is projected to rise to 915.5 billion yuan this year.

Pan Xuefei, research director at market consultancy IDC China, said the expansion of the consumer goods trade-in program this year, especially offering subsidies for the purchase of digital products, will motivate more consumers to replace their old smartphones with new ones, which will undoubtedly further spur consumption.

Min Qi, general manager of Chinese retailer Suning's store platform business division, said the company will continue to cooperate with major brands to launch new digital products in the first quarter of this year, and driven by the trade-in program, sales of household appliances and consumer electronic products are expected to see explosive growth with revenue doubling or tripling year-on-year during the January-March period.

Chinese smartphone maker Oppo said the government subsidy program will effectively stimulate consumer enthusiasm for buying smartphones and improve their purchasing power.

The company added that it will provide shoppers with high-quality products through technological innovation.

Meanwhile, Chinese home appliance enterprises are accelerating steps to expand recycling channels and drive the popularization of green and intelligent products.

Hisense Group is intensifying efforts to establish online and offline recycling and disposal channels for discarded home appliances.

Gree Electric Appliances, a major Chinese home appliance manufacturer based in Zhuhai, Guangdong province, has announced plans to invest 3 billion yuan to promote trade-ins of consumer goods.

fanfeifei@chinadaily.com.cn