Major equipment upgrades in China's traditional industries are set to drive increased investment and facilitate high-end development through the adoption of more advanced, cost-effective technologies.
China is a global manufacturing powerhouse, with its manufacturing sector accounting for 26.2 percent of the country's GDP in 2023 and contributing approximately 30 percent to the world's total manufacturing added value. Traditional industries - including petrochemicals, steel, nonferrous metals, building materials, machinery, light industry, and textiles - comprise over 80 percent of China's manufacturing output.
These industries are poised for a major shift, as equipment upgrades are expected to spearhead their transformation toward smarter, greener operations.
"Upgrading industrial equipment - including advanced machinery, digitalization, the adoption of green technologies, and safety enhancements - will effectively foster technological advancements, process upgrades, energy conservation, and production safety, especially in traditional industries. This transformation will drive high-end, intelligent, and green development across the sector," said Fan Meng, a director with the Industrial Investment Research Office of the Planning Research Institute of CCID Consulting at the Ministry of Industry and Information Technology (MIIT).
Despite the significant progress made to date, many enterprises still face long equipment renewal cycles, with much of their operational machinery outdated and inefficient.
Widespread equipment upgrades across the manufacturing sector will not only improve production efficiency and product quality, but also eliminate safety risks associated with aging equipment, helping businesses meet higher safety and quality standards.
"China's industrial equipment investment reached 4.4 trillion yuan (about 608 billion U.S. dollars) in 2023, accounting for over 70 percent of the nation's total equipment investment. According to new policies, industrial equipment investment is projected to grow by more than 25 percent by 2027, creating an estimated demand exceeding 10 trillion yuan (about 1.38 trillion U.S. dollars) over the next three years," said Gong Tianxiao, deputy director of the Institute of Information and Industrialization Integration of the China Academy of Information and Communications Technology (CAICT), referring to the targets and measures published by the Chinese government in April this year for industrial equipment upgrades to expand effective investment and develop new quality productive forces.
Equipment upgrades to fuel investments, industrial transformation in China
A new round of trade-in subsidy program is energizing China's consumer market these days, with provinces across the country seeing a surge in demand for cars, home appliances and digital devices.
In north China's Shanxi Province, the new trade-in subsidy program, which started on January 9, has further helped boost sales in home appliances and digital devices which are covered by the new round of subsidies.
To enjoy the subsidies, six types of home appliances, including refrigerators and washing machines, must meet national Level 1 energy-efficiency or water-efficiency standards. Digital and smart products include four types, such as mobile phones and tablets, with a sales price cap of 6,000 yuan (about 800 U.S. dollars) per item.
In both categories, subsidies are set at 15 percent of the final transaction price. For home appliances, the maximum subsidy is 1,500 yuan per item. For digital products, the cap is 500 yuan per item. Each consumer can receive a subsidy for one unit in each category.
Neighboring Shanxi, Hebei Province kicked off the year of 2026 with the new round of trade-in subsidy program starting on January 1.
The subsidies cover automobiles, home appliances, and digital products. Individual consumers who purchase designated Level 1 energy-efficiency appliances or eligible digital products priced at no more than 6,000 yuan can receive subsidies equal to 15 percent of the transaction price. The maximum subsidy is 1,500 yuan per appliance and 500 yuan per digital or smart device, with each person limited to one subsidized item in each category.
Data showed that from Jan 1 to 9, Hebei's home appliance trade-in program alone disbursed more than 130 million yuan in subsidies, driving sales of over 920 million yuan.
In east China's Jiangsu Province, the new trade-in subsidy program, taking effect for two weeks, has brought the province a boom in trade-in.
At a local 4S store in Jiangsu's Suqian City, showroom traffic has spiked as salespeople walked customers through the new benefits from the trade-in subsidy program.
"Under the scrappage-and-replacement scheme, customers who buy a new energy vehicle (NEV) can receive a subsidy worth 12 percent of the vehicle price, capped at 20,000 yuan (about 2,860 U.S. dollars). For combustion-engine cars, the subsidy is 10 percent, with an upper limit of 15,000 yuan. For trade-ins, NEVs are able to receive a subsidy worth 8 percent of the vehicle price, up to 15,000 yuan, while combustion-engine cars will receive a 6-percent subsidy, with a cap of 13,000 yuan," said Sun Yue, a saleswoman at the store.
In the home appliance sector, Jiangsu's policy this year stipulates that only products that meet China's Level 1 energy-efficiency standard are eligible for subsidies. The scheme covers six major categories, including refrigerators and washing machines.
Consumers who purchase qualifying appliances can receive a subsidy equal to 15 percent of the final retail price, up to a maximum of 1,500 yuan per item. Each person is limited to one subsidized unit per product category.
Four types of digital and smart products, such as mobile phones and tablets, are eligible for a 15-percent subsidy capped at 500 yuan per unit, with a retail price no more than 6,000 yuan.
"With the national subsidy policy back in place this year, I went to the store to check what discounts I could get. It knocked 500 yuan off the price. [The discounted price is] very reasonable," said Wang Kang, a resident of Jiangsu's Xuzhou Province.
To enhance the shopping experience for consumers, many retailers are pairing subsidies with "one-stop" services that combine the delivery of new products with on-site collection of old ones.
"After consumers place an order for new home appliances, our staff will schedule a time to pick up the old units. Recycling the old appliance can also further offset the purchase price of the new one," said Yang Jie, a sales supervisor at a major home appliance company.
China's new trade-in program sparks consumption boom
