Home appliances to the countryside will expire due to the policy exit affect the industry

Since the beginning of this year, home appliances to the countryside has achieved brilliant sales results. Everbright Securities statistics show that in the first nine months of this year, sales of household appliances to the countryside were 74.77 million units, and sales were 188.1 billion yuan, up 42% and 62% year-on-year respectively. Among them, 9.08 million units were sold in September, with sales of 24.2 billion yuan, up 50% and 67% respectively year-on-year. From the perspective of enterprises, Haier Group, Hisense Group, and Midea Group still rank the top three sales, accounting for 30% of the total sales of home appliances to the countryside during the month.

From the perspective of products, air conditioners, color TVs and other products increased by more than 70% year-on-year, and the growth momentum was better than other household electrical appliances, showing the particularity of the rural market. In terms of regions, sales in the three provinces of Shandong, Henan, and Sichuan increased by more than 30% month-on-month, which was higher than other regions. BOC International Researcher Liu Huiming said that in September the number of home appliances to the countryside changed slightly in the past few months, and the rapid growth was mainly due to the end of November this year, Shandong, Henan, Sichuan and Qingdao “three provinces and one city” home appliances to the countryside. The policy is about to expire, releasing some of the demand in advance.

As the consumer pull effect gradually weakens, home appliances to the countryside will also gradually come to an end. Following the three provinces and one city in November this year, nearly 10 provinces will exit the policy by the end of next year. However, market analysts also do not believe that the withdrawal of the policy will have a negative impact on the future home appliance market. Liu Huiming analyzed that since the implementation of the home appliances to the countryside policy, various home appliance companies have basically completed the channel construction and brand promotion in the rural market, and have established a firm foothold in the rural market. Secondly, the market has long expected the policy exit that began at the end of the year. Most home appliance manufacturers have started to respond in advance, reducing the production and promotion of products to the countryside, and gradually diluted the impact of policy exit.

Qingdao Haier Office Manager told the Securities Times reporter that the policy of home appliances to the countryside is essentially in line with the vast rural market demand for upgrading air-conditioning, color TV and other products, but not rural market demand depends on the continuation of home appliances to the countryside policy. From the perspective of the company's front-end feedback, the fluctuations are not obvious.

Chen Ziyi, a researcher at Haitong Securities, also believes that the rural market is still huge, regardless of whether there are policy incentives. Taking air conditioners and color TVs as an example, the popularity of air-conditioning in the rural areas has been rapidly started this year. Due to the smaller base, the growth rate is very fast. Although TVs have a high retention rate in rural areas, there is a lot of demand for updates. At present, there is still room for improvement in the rural refrigerator and washing machine retention rate, and it will maintain a good growth momentum.