Midea's Home Appliances Going to the Countryside to Benefit Local Farmers

November 20, 2008 witnessed the tendering results of the "Project of Promoted Products for Home Appliances Going to the Countryside" as jointly organized by the Ministry of Commerce and the Ministry of Finance. Midea became one of the enterprises with the most products qualified for the project, with its refrigerators and washing machines among the first bid-winners. It is reported that Midea air-conditioners and water-heaters are among the candidates for phase II of the project, with the results to be published by the end of this month. Statistics show that the household appliances industry of China is facing a tough time in terms of exportation this year, due to the further fallouts of the global financial crisis. Amid the difficulties for export sales, the policy of "Home Appliances Going to the Countryside" provides the best means for enterprises in the industry to expand their domestic sales.
The launching ceremony for the project of "Home Appliances Going to the Countryside in Guangdong" was held on Panyu Square of Guangzhou on the morning of February 11, 2009. Products such as refrigerators, washing machines, color TV sets and mobile phones by 55 bid-winning enterprises including Midea will be available to tens of thousands of consumers in the countryside markets in the province. VIPs attending the ceremony included Mr. He Xiangjian, Chairman of Guangdong Household Electrical Appliances Chamber of Commerce and of the Board of Directors of Midea Group, as well as Mr. Tong Xing, Vice-governor of Guangdong Province.
He Xiangjian,the chairman of Midea Leads to Take the Oath of Good Faith
On the launching ceremony, representatives of Midea Group, Grandbuy and all the other bid-winning enterprises signed their names on the declaration of good faith, and then led by Mr. He Xiangjian, Chairman of the Board of Directors of Midea Group, they read out ten commitments for the project of "Home Appliances Going to the Countryside in Guangdong" in terms of quality, prices and services, undertaking to carry out various tasks to support and benefit the farmers. The launching ceremony also marks the overall start and implementation of the four-year project of "Home Appliances Going to the Countryside" in the province.
100 yuan discount by Midea plus 13% of government subsidy
Around the Midea stand at the venue of the launching ceremony, we could see a lot of countryside users from nearby areas inquiring and purchasing household appliances. According to the staff at the stand, Midea refrigerators of the same model were originally sold at the same price in urban and rural areas alike. Now, thanks to the project, farmers can purchase the products with a discount of about 100 yuan, in addition to 13% of government subsidy. Take for example the Little Swan refrigerator BCD-213FTL. It is generally sold around the nation at 2499 yuan, which does not exceed the project's ceiling price for refrigerators. However, consumers from the countryside can now purchase it at 2398 yuan with an additional 13% discount, only by producing their household registration book and identity cards. Mr. Chen from Dashi Town of Panyu District asked about the purchase with great enthusiasm, before he ordered one on the spot.
According to the latest policy of "Home Appliances Going to the Countryside", the financial authorities shall provide related subsidies at 13% of the sales prices of qualified products. Within a certain period of time, however, a rural household is entitled to subsidies for no more than two pieces of products in each category, including color TV sets, refrigerators (freezers), mobile phones and washing machines. Based on the purchase rate of 5% in the Pearl River Delta and 15% in the northeastern and northwestern parts of the province, the Provincial Economic and Trade Commission preliminarily estimates that the project can bring along social consumption of at least 5 billion yuan throughout Guangdong in the next 4 years.
Midea Water-Heaters among Candidates in the Project of "Home Appliances Going to the Countryside"
State authorities have recently announced the second and the third batches of products entitled to subsidies in the project, including computers, water-heaters, motorcycles, air-conditioners, microwave ovens and induction cookers. Guangdong Province has filed a supplementary list of computers and water-heaters to competent state authorities, subject to the final approval by the Ministry of Commerce and the Ministry of Finance. Guangdong has selected computers and water-heaters as the latest candidates for subsidized products according to the actual consumption needs in the rural areas of the province. The director of Midea's Kitchen & Bath Appliances Division says that they are making full preparation for the bidding process related to water-heaters as well as product development, sales and promotion for the project of "Home Appliances Going to the Countryside".