Bank of China International published a research report stating that the State Council, in conjunction with various ministries and commissions, issued the “2026 Large-scale Equipment Renewal and Consumer Goods Trade-in Subsidy Policy Notice” to continue incentives for automobiles, home appliances and digital products, and enhance policy effectiveness through targeted optimization. The bank believes that although the size of the subsidy budget has been reduced as expected, the new policy clearly favors the middle and high-end market, and the decline in corresponding model subsidies is far lower than market concerns. The subsidy for digital products remained at 15% of the sales price, with an upper limit of 500 yuan, which was better than market expectations; subsidies for home appliances were tightened, the audience narrowed down to the six core categories, and only the first-level energy efficiency standards were subsidized, and the subsidy ratio was reduced from 20% to 15% of the sales price. According to the bank, with the early implementation of subsidy rules and timely disbursement of subsidy funds, the automobile industry is expected to get off to a good start in 2026. However, given the high level of channel inventory at the end of the year due to consumer wait-and-see sentiment in the fourth quarter, the first quarter of 2026 may enter the inventory removal stage. At the individual stock level, the bank believes that the Ideal Auto, Xiaomi, NIO, Wanjie, and Extreme Krypton brands will be minimally affected by the trade-in subsidy adjustments.

Bank of China International published a research report stating that the State Council, in conjunction with various ministries and commissions, issued the “2026 Large-scale Equipment Renewal and Consumer Goods Trade-in Subsidy Policy Notice” to continue incentives for automobiles, home appliances and digital products, and enhance policy effectiveness through targeted optimization. The bank believes that although the size of the subsidy budget has been reduced as expected, the new policy clearly favors the middle and high-end market, and the decline in corresponding model subsidies is far lower than market concerns. The subsidy for digital products remained at 15% of the sales price, with an upper limit of 500 yuan, which was better than market expectations; subsidies for home appliances were tightened, the audience narrowed down to the six core categories, and only the first-level energy efficiency standards were subsidized, and the subsidy ratio was reduced from 20% to 15% of the sales price. According to the bank, with the early implementation of subsidy rules and timely disbursement of subsidy funds, the automobile industry is expected to get off to a good start in 2026. However, given the high level of channel inventory at the end of the year due to consumer wait-and-see sentiment in the fourth quarter, the first quarter of 2026 may enter the inventory removal stage. At the individual stock level, the bank believes that the Ideal Auto, Xiaomi, NIO, Wanjie, and Extreme Krypton brands will be minimally affected by the trade-in subsidy adjustments.