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CPCA: CN NEV Purchase Tax Waiver/ Reduction to Pile Huge Pressure on 2026 Car Mkt
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Given strong trade-in subsidies, the scale of automobile trade-ins in Mainland China in 2025 was foreseen to exceed RMB180 billion, the China Passenger Car Association (CPCA) said. Coupled with a 10% purchase tax discount for new energy vehicles (NEVs), the sales volume benefiting from this was expected to be 22% more than in 2024. This implied that over RMB200 billion in vehicle purchase taxes corresponding to sales of over RMB2 trillion in NEVs will be waived. Therefore, with nearly RMB400 billion in tax exemptions and subsidy support, the car market in 2025 was anticipated to grow beyond expectations. However, in 2026, the waiver or half-reduction in NEV purchase tax was estimated to result in a decrease of over RMB100 billion in profits of automakers. As such, the mainland car market in 2026 will face enormous growth pressure. AASTOCKS Financial News Website: www.aastocks.com |
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