City expands car subsidy policy to out-of-town license

Shanghai has announced an expansion of its car replacement subsidy policy, which now includes vehicles registered outside the city, a significant shift from previous rules that only covered locally licensed cars.

The new policy, effective from January 1 to December 31, 2025, offers up to 15,000 yuan (US$2045) for purchasing new-energy vehicles (NEVs) and 13,000 yuan for fuel-powered cars meeting the strict emission standards in China.

Under the updated policy, consumers who buy a new car priced at 100,000 yuan or more and transfer their out-of-town licensed vehicle within the specified period are eligible for the subsidy.

For example, a Shanghai resident owning a Jiangsu-licensed car can now sell it and receive the subsidy when purchasing a new NEV or fuel vehicle in Shanghai. Previously, only Shanghai-licensed cars qualified for such benefits.

"The policy removes a major barrier for out-of-town license holders, who can now enjoy combined discounts from both manufacturers and the government," said Peng Yanxia, general manager of a local 4S store.

She highlighted the case of a popular model, the RX5 PLUS, which, after subsidies, drops from 104,800 yuan to just 56,800 yuan.

Tesla sales staff also noted an immediate impact.

"Several out-of-town license holders placed orders on the first day of the policy announcement, as it sped up their decision-making," they said.

The move targets more than 1.05 million long-term out-of-town licensed vehicles in Shanghai, aiming to boost auto sales and accelerate the transition to greener vehicles.

This expansion follows the success of last year's subsidy program, which drove more than 300 billion yuan in new car sales.