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Old Vehicle Exchange Policy – New Energy Vehicle Market Accelerator

Against the backdrop of a booming new energy vehicle industry, the Chinese government’s trade-in policy has been a key driver of market growth. The National Development and Reform Commission (NDRC), in conjunction with the Ministry of Finance (MOF), officially unveiled the details of the much-anticipated 2025 automobile trade-in policy on January 8 this year, which is designed to further promote large-scale equipment replacement and consumer goods upgrades. The release of the Circular on the Implementation of Large-Scale Equipment Renewal and Consumer Goods Trade-in Policy for 2025 Plus Expansion marks the arrival of a new wave of automobile trade-ins.

Data source: China Association of Automobile Manufacturers (CAAM)
Since the implementation of the policy in 2024, China’s new energy vehicle market has maintained a high momentum, with annual production and sales exceeding 10 million units for the first time, of which the penetration rate of new energy passenger cars has exceeded 50% in consecutive months. Under the continuous reinforcement of the old-for-new policy, the outlook of new energy vehicle market in 2025 is optimistic.

Data source: China Association of Automobile Manufacturers (CAAM)

It is optimistically expected that the sales volume of new energy vehicles will reach about 16.5 million units (including exports) in 2025, with a growth rate of nearly 30% and a penetration rate of more than 50%; among which, the domestic market is expected to reach 15 million units, with a penetration rate of more than 55%. This policy not only accelerates the popularization of new energy vehicles, but also brings new market opportunities for car companies, prompting them to increase investment in R&D and innovation of new energy technologies.

For car companies supporting business, new energy vehicle sales spurt growth, means that the demand for batteries, motors and other core components show a sharp upward trend, which is undoubtedly supporting business to open up a huge market full of unlimited potential. At the same time, the strong impetus of the policy also forced the supporting business in product quality control and technological innovation level to upgrade, in order to meet the market for high-performance, high-security new energy vehicles, the urgent needs of the market.

However, the implementation of the policy for the industry to bring a lot of good at the same time, but also brought a series of serious challenges to the car companies. As the subsidy continues to increase, automakers need to maintain cost competitiveness in a fiercely competitive market on the one hand, and accelerate the R&D and production of new energy models on the other, in order to quickly adapt to the rapidly changing market environment. In addition, as the policy deadline is getting closer and closer, automobile enterprises urgently need to prepare for the rainy days and formulate new market strategies so as to maintain the continuous growth of sales.

As a leading supplier in the field of new energy vehicle power system, Zhenhengheng Power always adheres to the advanced technology concept and excellent service quality to provide solid and powerful support for major automobile enterprises, and hand in hand to contribute to the sustainable development of new energy vehicle industry.