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China has become the low‐cost manufacturing center of the world. The purpose of this paper is to provide an in‐depth analysis of a new manufacturing strategy for China's future manufacturing sector which is trying to transform into a new low‐carbon development paradigm. It also aims to discuss the empirical implications and policy suggestions.

The paper is based on the broad reviewing of the relative government documents and press reports in China, the USA, and Japan. The authors also conducted case research of China's remanufacturing practices.

The high energy consumption and emissions of China's manufacturing sector results from the widespread use of obsolete production equipment, which can produce low‐cost products with a severely negative environmental effect. The remanufacturing strategy can upgrade existing production equipment to improve production efficiency, which will be a more practical paradigm for China's future manufacturing sector.

The previous relative low‐carbon policies in China are mainly associated with the administrative measures, such as direct “command‐control”, which have paid little attention to the practical development paradigm. This paper first provides a framework for understanding and practical evidence for the remanufacturing strategy as a new low‐carbon paradigm for the giant manufacturing sector of the world's largest developing country.