One of the most discussed topics on social media in the past month has been the competition for national subsidies.
Posts like “Finally got the computer national subsidy”, “When will Beijing national subsidy restart”, “How can we get the national subsidy” have been circulating on social media platforms, with both the excitement of grabbing the last wave of dividends and the anxiety of not being able to get them.
On September 30, the National Development and Reform Commission announced that, together with the Ministry of Finance, it had issued the fourth batch of 69 billion yuan of ultra long term special treasury bond bonds to support consumer goods trade in. So far, 300 billion yuan of central funds had been issued throughout the year. This means that the nearly two-year consumer stimulus plan will come to a temporary end.
At the end of the day, many home appliance companies showed full sincerity and sold at the subsidized price regardless of whether consumers snatched the national subsidy coupons or not; Some car companies have also announced the addition of factory subsidies on top of national subsidies, in order to boost their performance before the end of year purchase tax subsidies expire; Even Apple’s newly launched iPhone 17 has added national subsidies, becoming the fastest discounted new phone in history.
In fact, the new funding allocation did not make it easier to grab the national subsidy coupons. In the first half of the year, during the initial stage of policy implementation, many regions issued subsidies based on the total annual subsidy amount, which was overdrawn in advance. In the second half of the year, the third and fourth batches of funds were mostly used as advance funding for sales enterprises, and there were not many new subsidies. Therefore, some places still strictly implement timed and limited coupon issuance and even lottery, and consumers not only compete for speed and internet speed, but also for luck.
It’s difficult to compete for national subsidies, and at the same time, the stimulating effect of national subsidies is also weakening. From January to August this year, a total of 330 million people nationwide applied for national subsidies, driving sales of related goods exceeding 2 trillion yuan, accounting for about 7% of the total retail sales of social goods (excluding catering) during the same period. However, since May, the growth rate of total social retail sales and sales of goods excluding catering revenue has slowed down, especially in industries such as automobiles and home appliances that have benefited the most, with a significant decline in sales.
The national subsidy funds were overdrawn in advance, and correspondingly, consumers’ money was also spent in advance.
Looking back, the national subsidy has driven household consumption and also reshaped the consumer market in the past two years. The flow of 450 billion yuan in funds has benefited some industries and enterprises, but has also excluded others from subsidies and even caused them to suffer as a result. We are trying to ask, who is the biggest beneficiary of the national subsidy?
A race with inconsistent starting points
After two years of national subsidies, the consumer goods market seems to have been pressed the fast forward button, and every enterprise related to subsidy categories has experienced a reshuffle of fate. In March 2024, the Action Plan for Promoting the Trade in of Consumer Goods was released, with subsidies covering four major categories: automobiles, home appliances, home decoration, kitchen and bathroom, and electric bicycles; In January 2025, 3C products such as mobile phones, tablets, smart watches, and wristbands will also be included.
The new energy vehicle industry is the first to feel the trend. According to the policy, individual consumers can receive a subsidy of 20000 yuan for buying new energy vehicle models through trade in, and a subsidy of 15000 yuan for buying 2.0-liter and below fuel vehicles.
This one-time fixed subsidy mechanism has the most significant stimulating effect on new energy vehicles priced below 50000 yuan. According to Caixin statistics, in the first half of 2025, the top ten vehicles for scrapping and updating applications include Wuling Hongguang MINI EV, FAW Besturn Xiaoma, BYD Dolphin, Changan Automobile Nuo Corn and other models, all of which are A00 level cars with a starting price of less than 50000 yuan. After adding factory subsidies, some models can even receive a new car for less than 10000 yuan.
According to data from the China Association of Automobile Manufacturers, sales of A00, A-grade, and C-grade fuel vehicles all declined from January to August. During the same period, A00 and A0 grade new energy vehicles maintained a high growth rate of over 85% due to policy incentives. Correspondingly, car manufacturers that focus on affordable new energy vehicles have also become the biggest beneficiaries of national subsidies.
The first one is BYD. In the first half of 2025, BYD’s revenue was 371.3 billion yuan, a year-on-year increase of 23.3%, and its net profit attributable to the parent company was 15.5 billion yuan, far exceeding other companies. BYD itself follows the path of small profits and high sales, so the increase in sales has also brought stable profit growth.
But other car companies, although most of them have achieved sales growth, have increased their income without increasing profits under more intense price wars. Profits of companies such as SAIC, Geely, Great Wall Motors, Changan, Dongfeng, GAC, and FAW have all declined, while Xiaopeng, NIO, Xiaomi, and others have not yet escaped losses. More new energy car companies are struggling on the brink of profit and loss.
To some extent, the national subsidy has accelerated the reshuffling of the automotive industry under the price war, allowing the strong to remain strong while struggling car companies exit the stage faster. In another key subsidy area of 3C, the same reshuffle is also happening.
In January 2025, the newly added subsidy regulations for purchasing digital products include a subsidy of 15% of the sales price for purchasing mobile phones, tablets, smart watches, and wristbands (with a maximum price of 6000 yuan per item), with a maximum price of 500 yuan per item. According to the calculation of “500 ÷ 15% ≈ 3333 yuan”, when the price of a mobile phone is 3333 yuan, consumers can receive full subsidies. Therefore, models priced between 3000-6000 yuan can most benefit from policy dividends.
Among mobile phone manufacturers, Xiaomi’s response speed is definitely among the top tier. The sales model mainly based on direct sales enables Xiaomi to quickly seize the window period of national subsidies in terms of distribution and price regulation. According to Canalys data, in the first quarter of 2025, Xiaomi’s domestic mobile phone shipments reached 13.3 million units, a year-on-year increase of about 40%, with a market share of 19%, returning to the top spot in the Chinese market after ten years.
Not only smartphones, Xiaomi also has tablets, cars, and home appliances, and its business structure perfectly meets the scope of national subsidies. In the first quarter, Xiaomi’s household appliance business revenue doubled, with washing machine and refrigerator shipments reaching historic highs, and tablet and wearable device shipments ranking among the top in the world, driving IoT and consumer goods business to exceed 30 billion yuan in single quarter revenue for two consecutive quarters, with a strong year-on-year growth of 58.7%; Xiaomi SU7 has become the sales champion of all models in the price range of over 200000 yuan.
Therefore, in the first quarter, Xiaomi’s revenue increased by 47.4% year-on-year to 111.3 billion yuan, breaking through 100 billion yuan again after Q4 2024; After adjustment, the net profit reached 10.7 billion yuan, with a year-on-year increase of 64.5%. Xiaomi is one of the biggest beneficiaries of the national subsidy at the company level.
Huawei also maintained double-digit growth in the first quarter of 2025 with channel advantages and brand influence, shipping 13 million units, a year-on-year increase of 12%; OPPO、 Apple has been squeezed, with a 2% decrease in shipments for the former and an 8% decrease for the latter.
But in the second quarter, the national subsidy covered models priced over 6000 yuan, and Apple unexpectedly benefited. Apple CEO Tim Cook mentioned at the earnings conference that Apple’s business in China has received assistance from subsidies provided by China for some devices. According to the financial report, in the second quarter of 2025, Apple’s revenue in Greater China increased by 4.4% year-on-year to $15.37 billion, reversing the downward trend of two consecutive quarters; During the same period, despite a 2% overall decline in mobile phone shipments in China, Apple’s shipments grew by 1% against the trend.
Brands compete for reaction speed, price, and influence, while e-commerce platforms face a comprehensive ability test.
According to a research report by Guoxin Securities, as of December 13, 2024, JD’s national subsidy covers 14 provinces, 11 cities (6 provinces), 4 autonomous regions, and 4 municipalities directly under the central government, Taobao covers 15 provinces, 14 cities (3 provinces), 2 autonomous regions, and 3 municipalities directly under the central government, and Pinduoduo only covers 4 provinces, 2 cities (1 province), and 1 municipality directly under the central government. JD.com first launched the “National Subsidy Zone” on August 26, 2024, followed by Taobao on August 31, and Pinduoduo did not arrive until late October.
One of the reasons is the difference in patterns. JD.com is mainly self operated, with many local branches, which can directly connect with local governments and follow up on local subsidy policies in real time. At the same time, JD’s supply system is mature, 3C product users have a strong mindset, and with the cooperation of online and offline supermarkets and online platforms, it has become the platform that benefits the most from national subsidies.
In terms of efficiency and mentality, although Taobao is not as good as JD.com, it also responds quickly. On the consumer side, timely and regional national subsidy entrances have been set up, allowing users to use subsidies for consumption more clearly and conveniently; On the merchant side, we assist merchants in registering for national subsidies and assist in auditing and collecting payments, and also collaborate with brands to layout local business entities. In the end, Taotian also caught a lot of dividends.
The story of Pinduoduo is completely opposite. Due to its origins in white label products, Pinduoduo’s operators are mainly small and medium-sized merchants and agents, who are unable to provide complete qualifications or brand authorization, making it difficult for its products to participate in national subsidies; However, Pinduoduo’s national subsidy entrance is relatively hidden, which also increases the difficulty of user participation.
In the first quarter of 2025, Pinduoduo’s revenue was 95.7 billion yuan, nearly 6 billion yuan lower than market expectations; The net profit attributable to the parent company was 14.7 billion yuan, a year-on-year decrease of 47%. Chen Lei, Chairman and Co CEO of Pinduoduo, helplessly stated that as a third-party platform, Pinduoduo has natural limitations in conveying policy benefits to consumers, and merchants are at a clear disadvantage compared to competitors with self operated businesses. Although this issue was discussed last year, “challenges still exist due to limitations in our team’s capabilities
For many dealers and small brands, the problem is not just that the platform lacks resources, but that they simply cannot enter this game.
The national subsidy policy requires enterprises to advance subsidies first, and then wait for local finance to collect payments. At the same time, they also need to have qualifications such as a value-added tax special invoice system, anti-counterfeiting tax control equipment, and professional personnel training. For large brands or platforms, this is just a compliance cost, but for small distributors and home appliance manufacturers, it is a threshold of funds and systems, and an unbearable cash flow pressure.
This amplifies the ‘Matthew effect’ in the short term – the larger the funds and volume, and the stronger the player’s ability to connect with the government and brand, the more they can seize traffic and price windows, further expanding market share; And small and medium-sized manufacturers and individual distributors in already fragile areas are more likely to be squeezed out of the core market.
The original intention of national subsidy is universal, but in the actual operation of the market, it is more like a race with inconsistent starting points. Big players with fast response times, abundant funds, and wide channels benefit from the dividends, while small players with slow response times and weak funds are marginalized.
Stable growth of automobiles, upgrading of household appliances, and 3C structural adjustment
From the flow of funds, this two-year national subsidy is not a flood irrigation, but a precise irrigation.
Ranked by the allocation of national subsidy funds, the three industries that benefit the most are automobiles, home appliances, and digital.
As of May 31, 2025, a total of about 175 million subsidies for consumers have been issued nationwide, including 4.12 million applications for car trade in subsidies. According to the two batches of funds totaling 162 billion yuan issued at that time, car subsidies are estimated to be about 61.8-82.4 billion yuan, accounting for as much as 38% -51%, becoming an undisputed “funding black hole”; The sales of home appliances, home decoration, and digital products are huge, but due to the lower subsidy amount per transaction, their financial costs are much lower than those of cars.
This is not accidental. The automotive and home appliances industry is the most representative of the “chain driven effect”: a complete vehicle factory can drive hundreds of component companies, and behind the replacement of an air conditioner or refrigerator is the entire chain of copper, aluminum, plastic, logistics, and installation workers. In contrast, although digital products such as mobile phones and computers have a large volume, their core supply chains are more globalized, foreign brands have a high share, and fiscal stimulus has far less impact on domestic manufacturing compared to automobiles and home appliances.
Another reason is’ verifiability ‘. Unlike the service industry, scrapped cars and home appliances are updated with invoices, serial numbers, and energy efficiency labels, and the subsidy chain is traceable, auditable, and accountable. Under the framework of “shared responsibility between the central and local governments”, the central government would rather invest money in industries with evidence to rely on than allow local governments to operate at will.
According to CCTV News, at the 2025 China Automotive Industry Development International Forum, the relevant person in charge of the Ministry of Commerce stated that since the beginning of this year, as of September 10th, the number of applications for car trade in has reached 8.3 million. According to data from the China Passenger Car Association, the cumulative sales of passenger cars in China from January to August this year were 14.765 million units. This means that more than half of consumers have enjoyed the national subsidy.
The home appliance industry, which has been dragged down by the real estate market for a long time, has finally received a welcome rain. In the first half of 2025, the total revenue and net profit of 102 listed companies in the Shenwan home appliance sector increased by 9.19% and 12.79% respectively year-on-year. Among them, the first tier companies Midea, Haier, and Gree all had profits exceeding 10 billion yuan, and the profit growth rates of Ecovacs and Changhong also exceeded 60%. However, after the peak of subsidy stimulus, the growth rate of Q2 performance slowed down significantly.
The structure of the home appliance industry has also undergone upgrading, becoming smarter and more environmentally friendly. In the first half of 2025, the sales of smart refrigerators, smart air conditioners, and smart range hoods will all increase by more than 10% year-on-year. The total sales of first – and second level energy-efficient home appliances will account for 80-90% of the total sales, especially for first level energy-efficient televisions, which will see a sharp increase of 863% year-on-year.
The price band distribution of 3C products has been rewritten, and mid to high price models priced above 3000 yuan have become more popular. According to Counterpoint data, in the first half of 2025, sales of mobile phones priced at $600 or more (approximately RMB 4300) increased by 11% year-on-year, faster than the overall growth rate of the mobile phone market (2%), and the corresponding market share also increased by 2% year-on-year, reaching 28%.
The steady growth of automobiles, the upgrading of household appliances, and the 3C structural adjustment have reshaped the upstream and downstream of the manufacturing industry with the flow of national subsidies. But this growth is still short-term. Under the amplification of fiscal leverage, enterprises have fulfilled their future sales ahead of schedule, while consumers have overdrawn their subsequent demand ahead of schedule. According to data from the National Bureau of Statistics, in August 2025, the total retail sales of consumer goods reached 3966.8 billion yuan, a year-on-year increase of 3.4%, with growth rates slowing down continuously since May.
The Yong’an Futures Research Center found that last year’s national subsidy leveraged about half of the new car consumption, but the growth of car consumption this year is not strong. Reflected in sales revenue, the additional pull is basically zero.
The marginal effects of household appliances and mobile phones are also decreasing. The market for refrigerators has exceeded 500 million units and air conditioners is 600 million units, with the market tending towards saturation; The mobile phone replacement cycle has been extended to 40 months. According to Counterpoint data, the shipment volume of smartphones in China in the second quarter of 2025 decreased by 2.2% year-on-year, mainly due to most mobile phone manufacturers launching new models in advance to take advantage of the national subsidy discounts.
Therefore, this is a structural adjustment of the stock market. After the national subsidy, industries and companies may face problems of shrinking demand and declining sales, and the industry reshuffle will accelerate again.
The realistic gap in the allocation of national subsidy funds
With the phased allocation of central funds and tight local budgets, the “geographical outline” of national subsidies is gradually emerging. Subsidies are nationwide, but the financial situation varies from place to place, and different groups have varying levels of purchasing power, resulting in significant differences in the effectiveness of policy implementation.
From the perspective of population, urban and middle-income groups have more comprehensive information access, wider coverage of compliant merchants and e-commerce channels, more old devices that are easier to verify by the system, and more convenient participation in national subsidies. Relatively speaking, rural and low-income groups face obstacles such as information asymmetry, limited access to compliant sales and recycling outlets, and low proportion of verifiable old items for automobiles and household appliances, all of which result in low participation rates and limited sense of gain.
In order to bridge the urban-rural gap, various regions have also made some attempts. For example, Ningxia strives for central finance to use rewards instead of subsidies to reduce the cost of farmers in remote areas participating in trade in programs; Mobilize volunteers, grid workers, and township officials from various towns and villages in Xixia District, Yinchuan City to promote policies and help farmers familiarize themselves with the process of exchanging old for new; Merchants in Linyi County, Shandong Province have set up sales and service stations specifically in towns and villages.
From a regional perspective, the policy stipulates that the funds for exchanging old for new consumer goods follow the principle of “shared responsibility between the central and local governments”, with an overall ratio of 9:1. The central government bears the main responsibility, with 85%, 90%, and 95% respectively for the eastern, central, and western regions, and local governments supporting the remaining portion based on their own financial resources. When allocating funds, the country comprehensively considers factors such as permanent population, regional GDP, and the number of cars and home appliances in each region to determine the scale of funds – this is a set of quantifiable and relatively fair distribution methods.
However, this set of rules presents a complex reality at the local level. Taking Yunnan and Jiangsu as examples: In 2024, Yunnan applied for a national subsidy fund of 4.055 billion yuan, accounting for 2.7% of the country’s total, slightly higher than its GDP proportion (2.3%), but lower than its resident population proportion (3.3%); The subsidy funds applied by Jiangsu are 12.74 billion yuan, accounting for 8.5% of the national total, which is lower than its GDP proportion (10.15%) but higher than its population proportion (6%).
In other words, the central allocation tends to support the central and western regions at the policy level, but economically developed regions still have advantages in terms of actual digestion speed and utilization efficiency. The differences in local fiscal capacity, residents’ consumption power, and administrative execution power ultimately determine who can truly benefit from this “national subsidy” dividend.
The purpose of national subsidies is to achieve lasting and widespread stimulation with less money. It not only tests the local financial foundation, but also the precise design of policy implementation. In 2025, the government will allocate a total of 300 billion yuan for the exchange of old for new consumer goods, which will be distributed in January (81 billion yuan), April (81 billion yuan), July (69 billion yuan), and September (69 billion yuan). This batch by batch distribution rhythm tests the financial situation and implementation ability of various regions.
Chongqing’s subsidies are like riding a roller coaster. In November last year, less than 70% of Chongqing’s subsidy budget funds were used up. Seeing that they were running out of money, the subsidies were quickly increased, and finally in less than 50 days at the end of the year, sales exceeded 10 billion yuan. This year, Chongqing, which has tasted the sweetness, immediately issued subsidies at the beginning of the year, leading to a large number of cross regional applications for subsidies and a surge in car sales. So, at the end of May, due to financial pressure, the subsidy for car replacement and renewal was suspended. In August, it was adjusted to be distributed according to the invoicing price ratio, and a limit on the total amount of bicycle subsidies and monthly subsidies was set to alleviate financial pressure.
Due to the level of economic development, subsidies in the western region appear tight. Many regions have extended the use of funds by lowering the subsidy amount for specific categories. For example, Yunnan Province has lowered the standards for car replacement and updates since August 12th. The single vehicle subsidy for new energy vehicles has been adjusted from 15000 yuan to 10000 yuan, and the single vehicle subsidy for fuel vehicles has been adjusted from 13000 yuan to 8000 yuan.
In contrast, Jiangsu’s performance is even better. In the first half of 2025, the total amount of social enterprises in the province will reach 2.39 trillion yuan, a year-on-year increase of 5%, with a growth rate higher than the national level. The scale and net increase of social enterprises will both be the largest in the country; A total of 25.98 million people have received subsidies, with a fund utilization of 17.377 billion yuan, driving consumption of over 140 billion yuan, accounting for 12.7% of the country’s total.
Jiangsu’s approach involves various aspects such as category optimization, rhythm control, and policy coordination. In terms of product categories, in addition to the 12 categories of household appliances stipulated by the state, Jiangsu will expand the subsidy scope to 58 categories, and focus on supporting local advantageous product categories such as water dispensers, wall breaking machines, dehumidifiers, etc; Starting from June, a “quota allocation” mechanism will be implemented, with daily and monthly upper limits set and phased distribution to control the pace of fund consumption; In terms of collaboration, the subsidy for purchasing new home decoration and furnishings will be expanded to include 12 types of building materials such as finished doors and windows, coatings, and tiles, forming a policy complementarity with the renovation of old kitchens and bathrooms and the aging adaptation of homes. With abundant finance and efficient implementation, Jiangsu has become one of the provinces with the highest conversion rate of national subsidies in this round.
During the two years of national subsidy implementation, a pattern gradually became clear: the pace of fund allocation, the flexibility of policy adjustments, and the coordination ability of local governments jointly determine the actual effect of subsidies; Areas with concentrated industrial chains have absorbed more dividends, while regions with weak economic foundations and tight finances can only participate to a limited extent.
Reference materials
Youthology: “Price Increase First, Subsidy Return Later: The Maze and Game of National Subsidy | Our Money”
Caixin: “National Supplementary ‘Mid term Entrance Examination'”
Financial magazine: “Can consumption still be stimulated after the decline of national subsidies
Economic Observer: “Is the suspension of ‘national subsidies’ for automobiles in many places caused by price wars
Interface News: “The craziest mobile phone ‘national subsidy’ in history: Who benefits? Who falls behind
Caixin News Agency: “National Subsidy Meets 618: Short term Carnival and Pattern Reshaping of the Mobile Phone Market”
Xinhua Finance: Semi annual Report on Home Appliance Industry: Double Growth in Revenue and Profit Midea, Gree, Haier Profit Exceeds 10 Billion RMB
QuestMobile: “QuestMobile 2025 China Smartphone Market Insights Report: National subsidy drives replacement wave, dual increase in proportion of mid to high end models, AI technology drives smartphones to become the ‘hub'”
CounterPoint: “China’s mobile phone shipments in Q2 2025 decreased by 2% year-on-year, with Huawei and VIVO having the highest market share.” “China’s mobile phone shipments in Q1 2025: Huawei increased by 18% year-on-year
Yong’an Research: “Trade in the Old for the New: In the Second Half of the National Supplement, Where Will Consumption Go”
PChome Technology: Net profit plummets by 47%, Pinduoduo, which missed the national subsidy dividend, chooses to ‘cut its own knife’
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