Economic legislation is an important system factor for economic development nowadays. This paper discussed how to improve legal policy for supporting new energy automobile industry development on behalf of reducing pollutant in the atmosphere. Analysis methods used in this paper are system law methods combined with economic analytical methods to demonstrate rationality. The authors find that policies implied are more inclined to new-car sales while ignoring the potential consumers who have got a car and want to replace it. Environmental subsidies for replacement of new energy automobiles can promote consumption so as to boost its industry development. And the replacement can optimize private owned car stock to lower exhaust and improve environment. So the authors make recommendation that the nation can learn from Germany car replacement environmental subsidies legal policy by introducing it to new energy vehicles replacement. This legal policy is good for both new energy automobile industry development and social environmental benefits. (C) 2017 Hydrogen Energy Publications LLC. Published by Elsevier Ltd. All rights reserved.