Shanghai's car consumption got boosted after Shanghai Municipal Commission of Commerce renewed trade-in subsidies for gasoline-powered vehicles and new energy vehicles (NEVs) on Saturday.

According to the policy on trade-in subsidies released on Saturday, consumers hoping to trade in their old gasoline-powered vehicle can apply for a one-off 2,800 yuan (about 388.96 U.S. dollars) subsidy. For consumers who want to upgrade their old NEV, they can apply for a one-off 10,000 yuan (about 1,389.16 U.S. dollars) subsidy.

The local car market has been flourishing after the policy was released. One store manager said that there were over 80 test-driving appointments on Saturday at their store, 20-30 percent more than that during the Chinese New Year holiday.

Mr. Zhang bought a pure electric vehicle for 300,000 yuan (about 41,674.77 U.S. dollars) at a NEV store in Minhang District of Shanghai. The car had been priced at 358,000 yuan (about 49,731.89 U.S. dollars) during his many visits to the store before the Chinese New Year.

"They told me about the trade-in subsidy that is about 10,000 yuan (about 1,389.16 U.S. dollars). This, coupled with the discount offered by the car company, saves me about 50,000 yuan (about 6,945.79 U.S. dollars). Therefore, I decided to make the purchase," said Mr. Zhang.

Business insiders said that car sales usually enter off-peak season after the Chinese New Year holiday as pent-up demand has been unleashed at the year end. However, things have changed this year. With subsidy policy rolling out, NEV stores in Shanghai saw a peak flow of consumers, including those previous wait-and-see customers. Many of the customers intend to purchase for replacement.

"The sales on February 24, the Chinese Lantern Festival, were impressive with a total of six units sold. However, we easily sold eight units on Saturday, half of which were purchased with trade-in subsidies. Consumers are encouraged to make purchases thanks to the policy," said Huang Kaikai, a store manager in Shanghai.

According to business insiders, with paying off of "cost reduction and efficiency enhancement," many NEV makers have made time-bound price readjustment in succession. Some companies offer a 50,000 yuan (about 6,945.79 U.S. dollars) discount on some models, and a 10,000 to 20,000 yuan (about 1,389.16 to 2,778.32 U.S. dollars) discount on most NEV models. The car market boom is expected to last thanks to attractive discounts coupled with vehicle subsidies.