Inventory pressure continues to increase over 70% of dealers to reduce the price of selling cars

A few days ago, the monthly data information released by the China Automobile Dealers Association (hereinafter referred to as the “Circulation Association”) showed that the dealers’ inventory warning index for auto dealers in June was 59.2%, which was higher than that caused by dealers’ takeovers to increase the purchase volume. The warning line, the entire car market is on a downward trend. The circulation association expects that the auto market in July is still not optimistic.

2016-2018 China Auto Dealer Inventory Warning Index Chart

Statistics show that in May, the national second-hand car market transaction volume was 1.203 million units, an increase of 21.02% year-on-year; in the first five months, the second-hand car transaction volume reached 5.545 million units, a cumulative year-on-year increase of 15.44%. Xiao Zhengsan, secretary general of the circulation association, said that the monthly transaction volume of used cars has reached 1.1 million steps, which has been maintained for nearly one year and the quantity is stable, indicating that the trading environment of used cars is gradually getting better.

Inventory index continues to rise, it is expected that July is still not optimistic

In June, the automobile dealer inventory warning index rose by 5.5% from the previous month and rose to 59.2%. From the point of view of the sub-index, the inventory index increased on a month-on-month basis, while the market demand index, the average daily sales index, the employee index, and the business condition index both fell. In this regard, the director of the Industry Coordination Department of the Circulation Association, Hui Yumei, pointed out that at the end of the first half of June, the dealers took the initiative to increase the purchase volume in order to absorb the rebate, resulting in an increase in inventory pressure. At the same time, the index that is conducive to sales has declined, and the overall market performance in June was less than expected.

Hui Yumei added that the poor performance of the auto market in June was also associated with hot weather and reduced visitor traffic; the import tariff reduction policy led some consumers to wait and see; and the regulation of the property market and vehicle restrictions in some areas. Multi-factor superposition affects the overall sales of automobiles, and inventory pressure continues to increase.

Stock Alert Area Index for June 2018

From the perspective of various regions in the country, the Southern Region Index is 65.1%, the Western Region Index is 61.6%, the Northern Region Index is 57.5%, and the Eastern Region Index is 56.6%, both higher than the 50% glory line. The Zhongxin Jingwei client noticed that the Southern Region’s inventory warning index was the highest among the four major regions in the country. Hui Yumei explained that the Southern District is a relatively economically developed area of ​​China's economy, and the macroeconomic situation is also the most direct response in the region's auto market.

At the same time, the circulation association also released an inventory warning brand index. In June, the brand inventory index of all brands increased, among which the performance of independent brands was the most obvious. The inventory warning index reached 60.2%, followed by the mainstream joint venture brand of 60% and the imported luxury brand index of 55.9%. Hui Yumei said that from the brand index, all brands are above 50% of the line, and the overall market situation is worrying.

“Resellers increased sales promotion and reduced inventory pressure as much as possible.” Hui Yumei said that in June, the proportion of dealers who thought the price cuts reached 73.5%, up 10% from the previous month, and three-quarters of dealers sold cars at lower prices. It is the embodiment of the library in June and July.

Xiao Zhengsan said that since the country proposed to lower tariffs on July 1st in April, consumers have seen the currency, and the entire automobile market has insufficient purchasing power, which affects automobile sales. In addition, Sino-US trade frictions have also affected the automobile market this year.

Regarding the performance of the automobile market in July, the circulation association predicted that with the launch of some new models, the market attention will be improved. However, the adjustment of the tariff policy of imported cars has led to strong wait-and-see attitudes of customers, and the sales pressure of imported cars is very high. It is expected that the auto market is still not optimistic.

Second-hand car monthly sales broke 1.2 million SUVs and MPVs into the main driving force

After the decline in sales in April, the sales of used cars again exceeded 1.2 million in May. According to the data, the trading volume of the used car market in China was 1.203 million units in May. Xiao Zhengsan said that with the breakthrough of policies such as the “restriction of restrictions” and the standardization of dealers, consumers’ recognition of used cars is constantly expanding. . It is one of the key factors to ensure the sustainable development of the entire automobile industry and automobile market when the used car is ready for the new car market.

2018 used car monthly trading trend

In terms of models, the basic passenger cars in May were still the main trading models accounting for 58.22%, followed by passenger cars 10.14%, trucks 9.31%, SUVs 8.56%, MPVs 5.83%; Last month, the proportion of transactions between passenger cars and SUVs increased, and the proportion of other models decreased to varying degrees. Li Xin, deputy director of the Information and Statistics Department of the Circulation Association, said that the main driving force of the used car market this year is the SUV and MPV models.

In May, used cars used for the most years in 3-6 years, accounting for 45.76%, compared with 6.78% in April, followed by 22.08% in 3 years. Li Xin pointed out that with the gradual liberalization of the policy of restricting the use of used cars, the old models showed an acceleration of circulation, and the transactions of models over 10 years were expanded.

Lifting the restriction policy to promote the accelerated circulation of old models

Zhongxin Jingwei client (WeChat public number: jwview) noticed that in the first five months, the cumulative transaction volume of used cars was 5,545,800, an increase of 15.44% over the same period of last year; the accumulated transaction amount was 344.583 billion yuan, which was lower than the increase in transaction volume. It is 8.08%. The second-hand car price range of the vehicle market below 30,000 yuan was the largest, at 38.83%, up 1.6% from the previous month. With the gradual circulation of old models, the average price of vehicles may be further explored.

In addition, the circulation association also released the second-hand car manager index, saying that the operating conditions in June were not good, and it is expected that the sales of used cars will decline. At the same time, second-hand car managers believe that the current market is relatively adequate, but considering the weather and other factors, it is expected that it is still difficult to go out of the off-season in July, market transactions are still not active, demand and sales will also decline.

However, for the situation of the used car manager confidence index of 43.5% in July, Xiao Zhengsan believes that some of the managers involved in the used car manager index are small in size and are not sufficient to fully represent the market. It is recommended to appropriately revise the coefficient of the small manager index. To be closer to the development status of the used car market.