Summary of China's Home Appliance Market in Q1 2025: Volume Price Game under Stable Growth of National Subsidies
In the first quarter of 2025, under the joint action of market supply and demand, as well as the strong promotion of national subsidy policies, the resilience of the home appliance market will develop. We can summarize it with a poem: "The national subsidy program maintains steady growth, and the three hot topics shape the new trend. The game of quantity and price seeks to break through, and the victory still lies in the market of people and goods
National subsidy program maintains steady growth under normal circumstances
The national subsidy has driven the overall household appliance market from high growth to stable growth. According to AVC's aggregated data, the retail scale of the home appliance market (excluding 3C) in the first quarter of 2025 was 179.8 billion yuan, a year-on-year increase of 2.1%. On the one hand, with the normalization of national subsidies, consumers have a high wait-and-see attitude, and demand may see a better release during the national subsidy+promotion periods such as May Day and 618. The growth rate in the first quarter is lower than expected. On the other hand, the overall market grew by 4.0% year-on-year in the first quarter of 2024, with a relatively high base for the same period.
The phased characteristics of each category vary, with cleanliness leading the way, while washing and maintenance, environmental protection, color TV, kitchen and bathroom appliances, and kitchen appliances have seen slight growth, while air conditioning and refrigeration have declined.
TV sets continue to undergo technological upgrades, driving structural growth and increasing both volume and volume;
The air conditioning is in the off-season, with fierce com
petition and significant price reductions;
The upgrading of refrigerators with large capacity and other structures is slowing down, and a new round of price wars is becoming more prominent;
Migration of washing and maintenance scenarios, where the low frequency of the dryer and the high frequency of the washing machine complement each other in terms of flow, but the price is internally inflated;
The major cycle of replacing the first and second line of tobacco stoves may be approaching, continuing high growth;
Integrated stoves are still sluggish;
The benefits of washing, embedding, cleaning, and supplementing have all maintained growth. Among them, the recognition of washing and embedding is low, the threshold is high, and installation requires space, while the recognition of water purifiers is high, the threshold is not high, and the growth rate is the best; Professional upgrade of disinfection cabinet;
The overall product driving replacement of the water heater is insufficient, and the demand focuses more on the first and second line combustion and heating growth rate than the demand for the third and fourth line electric heating;
The demand for kitchen appliances is weak, but the structure of national subsidies is being boosted;
Replacing traditional tools with clean appliances, steadily penetrating and leading in various categories;
Air purifiers maintain high growth and promote the popularization of health needs;
The weather has a significant impact on both seasons.
The normalization of national subsidies has led to seven major characteristics in the home appliance industry.
① The industrial cycle of user competition: Starting from 2024, both brand and channel merchants will focus on user management, and the current core of market competition revolves around user competition.
② The category logic of rear wheel drive acceleration and dual wheel drive development: According to AVC's overall data, by 2024, the scale of the seven major product categories of dryers, dishwashers, embedded micro steamers, water purifiers, cleaning appliances, air purifiers, and coffee machines will reach 114 billion yuan, accounting for 13% of the entire household appliance market (excluding 3C). The importance of post demand drive is further elevated. In 2025, the policy will include dishwashers and water purifiers. We believe that: firstly, the two major categories will benefit significantly from the "national subsidy" in 2024; Secondly, both categories have water efficiency standards as a lever; Thirdly, from a policy perspective, further attempts should be made to shift from essential to essential product categories, laying the foundation for the long-term growth of home appliances.
③ The user logic of technological value and emotional value: In the context of the rapid development of AI, the low debt population before the age of 60 (65+) and the high asset population after the age of 6070 (45-64) require more technological innovation to meet their demands for intelligence, simplicity, health, and comfort. The high debt population born in the 1980s and 1990s (aged 25-44) has caught up with China's fastest changing 30 years, with clear consumption levels and diverse demand scenarios. They not only need to consume for their children (mother and baby appliances), for their elders, but also for themselves, and their demands require more emotional value to meet.
④ The consumption logic of secondary upgrading and secondary grading: We believe that during the current national subsidy period, the market presents a "strong inverted triangle" structure, while after the national subsidy period, the market will present a "weak dumbbell shaped" structure, corresponding to the weak upgrading before 2019 and the strong grading during the period of 2020-2023, forming a new structural change.
⑤ The logic of integrating reconstruction and finding customer flow channels: The root cause is still the industry facing the dilemma of insufficient traffic. Firstly, there is a lack of natural traffic, resulting in a decline in foot traffic in offline stores and an increase in customer acquisition costs on online platforms; Secondly, there is demand differentiation, with clear consumer stratification and scattered interest points, requiring precise outreach; Thirdly, attention is scattered, and user time is divided by short videos and social platforms, making it difficult for a single channel to fully cover.
⑥ The logic of manufacturers in the era of big fish and survival of the fittest: The home appliance market has gone through multiple rounds of reshuffling, and the ones that have survived until now are mostly big brands. In the future, in this fierce competition, the ultimate winner will be the ones who have achieved synergistic development in product strength, brand strength, and service strength.
⑦ Lowering expectations and transforming and upgrading in 2025: Firstly, the high base in the fourth quarter of the same period makes it difficult to grow in the fourth quarter of this year; Secondly, consumer enthusiasm has decreased; The third is the extension of the national compensation front, and a new round of internal competition may begin. There will be only a slight increase in the first quarter, a decline in the fourth quarter, and the second and third quarters will win the whole year.
Three hot topics shaping the new trend
Listening to persuasion marketing ": Entrepreneurial IP is essentially an advanced gameplay of user mental competition. We believe that for the creation of IP for manufacturing entrepreneurs, technology is the key, creating value for users is the goal, showcasing strength with technology, responding to users with temperature, and ultimately achieving a dual guarantee of technology and temperature. On this basis, user co creation is achieved from the front, middle, and back ports, and a full chain user participation system is built.
The first year of AI home appliances: standardized, perceptible, and with sales volume. From the perspective of AWE 2025, AI is the common focus of all home appliance companies. AI home appliances are mainly manifested in six aspects: deep integration into large models, deepening of perception capabilities, upgrading of proactive services, more natural interaction, whole house intelligent collaboration, and embodied intelligence development. For enterprises, the first step is to establish standards and definitions for AI appliances, secondly to make users perceive the differences in products, and finally to generate sales. Only in this way can AI home appliances be quickly implemented and help enterprises grow.
'Equivalent tariffs': export obstruction, brand differentiation, intensified internal competition, and accelerated innovation. The ship of Chinese home appliances heading out to sea is entering a sea full of hidden reefs. In the short term, the cost surge and order contraction caused by the tariff hurricane are inevitable; but in the long run, this crisis precisely exposes the fragility of the industry's excessive reliance on cost advantages, forcing companies to build technological moats. Trump's tariff stick cannot defeat true competitiveness, and after this storm, surviving companies will have stronger bones. Perhaps, this is the painful prelude to the transformation of China's home appliance industry from a 'world factory' to a 'global brand'.
Seeking to break through the game of quantity and price
Demand focus, comprehensive replacement of colorful ice washing, replacement of kitchen appliances in urban areas and new additions in rural areas, and coexistence of replacement and addition of air conditioning in rural and urban areas. Although the national subsidy policy has had a significant impact on the development pace of some home appliance categories in the short term, in the long run, the inherent long-term development pattern of the home appliance industry will not change as a result. According to the trend of ownership data, we can divide the home appliance industry into three categories. The first category is Caibingxi, where both rural and urban ownership have reached their peak, relying entirely on the drive of replacing new products; The second type is air conditioning, which has a growing trend in both rural and urban areas. When focusing on the stock, we cannot ignore the increment; The third category is kitchen appliances, which should not only focus on the replacement of first and second tier products, but also pay attention to the addition of third and fourth tier products.
High end and advanced, benefiting from national subsidies, the structure upgrade of the vast majority of home appliance categories is significant. AVC monitoring data shows that in the first quarter of 2025, there will be a significant improvement in the product structure of high-end price segments in the online market for color TVs, washing machines, range hoods, embedded micro steaming and baking, desktop micro steaming and baking single function, desktop micro steaming and baking multifunctional, and rice cookers; Except for a slight decline in the product structure of high-end price segments such as televisions, washing machines, and range hoods in the offline market, the high-end product structure of other categories still maintains steady growth, with dishwashers and desktop micro steaming ovens growing by over 10% year-on-year.
Exchange price for quantity, normalization of national subsidies, coupled with export obstacles, a new round of internal competition is expected to continue to intensify in the second quarter. According to AVC monitoring data, in the first quarter of 2025, the prices of refrigerators in the online market's three major sub markets of double door, cross four door, and French multi door all showed a significant decrease compared to the fourth quarter of last year, and decreased by 13.0%, 10.6%, and 2.9% respectively compared to the first quarter of last year; In the first quarter of 2025, the air conditioning prices in the three major segmented markets of 1P hanging, 1.5P hanging, and 3P cabinet machines in the online market also showed a significant decrease compared to the fourth quarter of last year.
Winning still lies in the human goods field
User segmentation management, cultivating the 'digital new generation', consolidating the 'reform era', and excavating the 'foundation generation'. Consumer groups of different age groups have varying demands and preferences for household appliances due to differences in their growth environment, consumption concepts, and lifestyles. The "digital new generation" pursues personalization and a sense of technology, the "reform era" focuses on quality and brand, and the "foundation generation" focuses on practicality and cost-effectiveness. Based on this, home appliance enterprises carry out user segmentation management, cultivate the "digital new generation", consolidate the "reform era", and tap into the "foundation generation", accurately match the needs of each circle, improve user satisfaction and market competitiveness, and achieve sustainable development.
Product intelligence upgrade, fully embrace AI, at least ensure not to fall behind. AI technology is completely rewriting the underlying logic of home appliances - in the past, home appliances were just "moving tools", but now they have become "thoughtful life managers". All industries are worth redoing with AI, and AI home appliances are no longer a problem for home appliance companies. The evolution of AI home appliances will go through three processes: basic intelligence popularization and scene adaptation, deep personalization and ecological collaboration, and autonomous decision-making and sustainable development. 、
Offline grid based deep cultivation enables the largest and most opaque physical stores to achieve precise reach and efficient conversion. The offline market remains the main battlefield for home appliance companies, and it is difficult to achieve precise and closed-loop marketing like online. In the context of the trade in policy, how to accurately identify the demand group for household appliances in physical stores, seize their consumption opportunities, and promote retail growth through offline operations, requires enterprises to focus on the community and carry out full chain grid operation.