中国：2026年以旧换新补贴规模缩减

Research Analysts China: A smaller trade-in program for 2026 Asia Economics Hannah Liu - NIHKhanrah.iu(@nomura.com+852 2252 1032 Today the National Development and Reform Commission (NDRC) and the Ministry ofFinance unveiled a joint document outlining the consumer trade-in subsidy program for2026. As widely expected, the program entered its third year. Bejing allocsted RMB150bnto this program during the final four montns of 2024 and an additional RMB300bn for2025. While the cocument dic not specify the total funding scale for 2026, the first batchallocation of RMB62.5bn for Q1 suggests an annusl amount of RMB250bn, which is in linswith a previously widely expected numiber. Other than smaller funding, the subsidy rules Ting Lu - NIHKting.unomura.com+862 2252 1338 The more restrictive trade-in policy for 2026 lenda support to our view of a slowdown inretail sales growth in 2026. We expect full-year retail sales growth to drop to 3.3% in 2026from an expected 3.8% in 2025, due to both payback effects and a higher base. As short-term stimulus measures such as the consumer trade-in program reach the limits of theirreforming the social welfare system could be the most effective strategy. A likely scale down to RMB250bn Although the scale of the consumer trade-in program for 2026 vill not be disclosed untilexpansion. According to the NDRC, the first batch of RMB62.5bn for Q1 has beenallocated to local governments to facilitate continuity and address consumption demanclsAssuming equal quarteriy distribution, we expect the full-year subsicy to be RMB250bn, inline with our forecast in the 2026 annual outlook (see: pages 13-20 of Asia Macro Outiook2026 Mind the gap, 3 December 2025). The actual scale could prove even smaller if we apply the ssme distribution patternobserved in 2025. During 2025, RMB81bn wss allocated per quarter in H1, with RMB69bnallocated per quarter in H2. Applying this front-loaded distribution pattern, we estimate thatRMB62.5bn could be allocsted per quarter in H1 2026, followed by RMB53.2bn perquarter in H2 2026, resulting in a recuced total scale of RMB231bn. More restrictive subsidy rules Comparison of the newly issued document vith the 2025 version reveals more restrictiveand cost-controlled subsidy rules, particularly affecting automotive and home appliancesejoBeres pezipisqns Jofe Jo senu Kood eun eano ew oeg 'seuobeqes Auto: Subsidy rules have become more controlled. For EVs priced aboveRMB160.000 and ICE vehicles (2.0L cr below) priced above RMB150,000, subsidyamounts remain unchanged at RMB20.000 for EVs and RMB15,000 for ICE vehicles.For lower-priced vehicles (EVs below RMB160,000 and ICE vehicles belowRMB150,000), subsidies will shift to an ad valorem basis with rates of 12% for EVsand 10% for ICE vehicles Home appliances: Subsidy policy has tightened considerably. First, prcduct coveragehas narrowed to 6 categories (refrigerators, washing machines, televisions, aircondliticners, computers, and water heaters) from 12 categories, eliminating stoves.range hoods, microwaves, water punifiers, dishwashers and rice cookers. Second,maximum subsidy per item was reduced to RMB1,500 from RMB2,000. Third, thesubsidy rate is set at a flat 15% exclusively for Level 1 efficiency products (the mostnergy officient), compared to 20% for Level 1 and 15% for Level 2 prcducts in 2025.Fourth, sach consumer is pemitted to purchase only one air conditioner, which isdown from three units in 2025. Frod,rlon Corrplsls: 2325-12-J1 cS 01 UTC remains RMB6,000 per item, with subsidies continuing at 15% of the price capped atRMB500 per item. The document introduces smart glasses as an emergingtechnology product to the subsidized list. Central government maintains 90% subsidy cost share According to the document, central government funcing remsins the primary source forthe cost-sharing ratio is generally set at S:1, with the central government covering 85%within the less financially distressed eastern regions like Guangdong, 90% in centralregions, and 95% across the more financially challenged western regions like Guizhou. Ifthe RMB250on central government subsicy is confirmed, total funding for the trade-inscheme could be RMB278bn in 2026, down from RMB333bn in 2025. We expect retail sales growth to drop to 3.3% in 2026 Payback effects from the trade-in program have already msterialized since H2 2025. Weexpect retail sales growth to decelerate to 2.6% y-o-y in H2 from 5.0% in H1. The morerestrictive trade-in policy for 2026 provides additional support for our view of significantretail sales growth deceleration in 2026 (see: psges 13-20 of Asia Macro Oulook 2026 -Mind the gap, 3 December 2025j. We xpect full-year retail sales growth to decline to3.3% in 2026 from our forecast of 3.8% in 2025. Growth in durable goods sales, whichbenefited substantially from subsidies during 2025, is likely to decline markedly to 2.0% in2026 from an astimated 6.1% in 2025. Trade-in subsidy offers no panacea for susta