China's "Old for New" Auto Subsidy Fuels Consumption by 20.5 bln Yuan in 1H

BEIJING, July 12 -- China's auto replacement policy has boosted domestic auto spending by 20.5 billion yuan (3 billion U.S. dollars) in the first half of the year, said the Ministry of Commerce (MOC) Friday in an online statement.

Relevant departments had handed-out 2.4 billion yuan in subsidies that had resulted in 174,000 vehicles being replaced in the first six months this year, said the MOC in the statement.

In a bid to accelerate the elimination of high-emissions and polluting vehicles and stimulate automobile consumption, the government rolled out the "old car for new" subsidy last June -- encouraging people to replace their old cars.

Consumers who trade-in their used small-and- medium-sized trucks and some types of mid-sized passenger cars for new ones can receive subsidies ranging from 3,000 (349.2 U.S. dollars) to 6,000 yuan.

The subsidy will last till Dec. 31., according to an earlier statement posted by the MOC in June.

China Association of Automobile Manufacturers (CAAM) said Friday that Chinese auto sales rose 47.67 percent year on year to 9.02 million units in the first half of the year.