A mobile charging vehicle, which can fully charge three to five new energy vehicles in a single session is seen in Hangzhou on January 27, 2024. Photo: VCG

Hangzhou, the capital of East China's Zhejiang Province, unveiled an action plan on Thursday to boost consumption via automobile trade-ins. The plan set an ambitious target of exchanging 80,000 vehicles by 2027, which will help to achieve new energy vehicle (NEV) penetration of over 50 percent.

This move comes as China is ramping up efforts to accelerate structural optimization in the automobile industry and unleash its vast market potential. It is also the city's latest endeavor to drive consumption and foster high-quality economic growth, analysts said.

The action plan outlines the implementation of a consumer goods trade-in program, targeting durable items with high demand and significant stimulus effects. As well as automobiles, it includes household appliances, home furnishings, and e-bikes, aiming to introduce more high-quality consumer goods into people's lives.

China's local governments at various levels have rolled out multiple incentive policies to promote large-scale automobile trade-ins recently, following the State Council's call in March for large-scale equipment renewals and consumer goods trade-ins.

Shenzhen in South China's Guangdong Province also introduced on Monday a slew of new measures to promote the upgrading of automobile consumption, including support for NEV purchases and development of the second-hand car market.

These efforts aim to accelerate the growth rate of consumer goods sales in Shenzhen to more than 7 percent in 2024, advancing the city's ambition to become a globally influential consumption hub, according to an action plan released by the local government.

Wenzhou in East China's Zhejiang Province announced a consumer goods exchange policy on May 24, offering incentives for NEV purchases, including subsidies ranging from a minimum of 2,000 yuan ($276.41) to a maximum of 10,000 yuan.

China has also unveiled measures to gradually lift restrictions on NEV purchases in various regions, according to a decarbonization action plan released on Wednesday, which is set to offer another major boost to the NEV industry.

The plan includes major steps to reduce carbon emissions in the transport industry, with concrete plans for infrastructure upgrades and the promotion of NEVs. Industry observers said it will inject new impetus into the country's consumption market and speed up the high-quality development of China's economy.

In April, China's NEV retail sales reached 674,000 units, up 28.3 percent year-on-year, while the domestic retail penetration rate rose to 43.7 percent. In addition, from January to April, China's passenger vehicle exports increased by 37 percent year-on-year, with NEV exports up 26.8 percent year-on-year, accounting for 27.9 percent of April's car exports, showcasing the growing demand from both the domestic and the global market.

China's NEV market also saw significant growth in sales in May. From May 1 to 26, NEV retail sales rose 27 percent year-on-year to 574,000 units, and cumulative retail sales this year have risen 32 percent year-on-year to 3.025 million units, according to industry data released on Wednesday.