AutoBeta(AutoBeta.net)02/24 Report--

Affected by the epidemic situation of new coronavirus pneumonia, China's automobile industry has entered the lowest period in history. In addition, the original automobile market environment continues to decline, and new energy vehicles have been hit by a sharp decline in subsidies. A series of factors have led to a very bleak start to the automobile market in 2020. In early February, China's car sales fell by a record 92% year-on-year, and market worries intensified under the impact of the epidemic. However, the industry has high expectations for the automobile market, thinking that the demand for car purchase will gradually recover in the next quarter, there is the possibility of concentrated demand outbreak in the second quarter, policy decompression rescue or set off a new round of climax.

Will the car market explode?

According to the latest automobile sales data released by China Passenger Association, the domestic automobile market fell 20.4% year-on-year in January, and the sales volume in February fell to the bottom. In the first week of February (January-9), the average daily retail sales of passenger car market was only 811 units, down 96% year-on-year; the retail sales in the second week (October-16) reached 4098 units per day, down 89% year-on-year; Overall, retail sales fell as much as 92 per cent year-on-year in the first two weeks of February, the highest decline on record.

What will happen to the auto industry after the epidemic? There are views that, firstly, private car consumption will usher in a pull-up effect after the epidemic situation, and consumers 'demand for private car travel will be further strengthened; secondly, the potential automobile consumption superimposed by the holiday in January and the epidemic situation in February will be released in the follow-up, helping the short-term sales volume to rise sharply; thirdly, the government will clearly introduce new policies to promote automobile consumption, which is of great significance for the continuous stability of automobile consumption in 2020.

A number of securities companies auto industry analysts think, During the epidemic period car sales decline significantly, But after the epidemic will appear concentrated car purchase, Drive some months sales to achieve year-on-year positive growth, At the same time the epidemic will stimulate some car-free families car purchase demand, Consumers will be more inclined to private car travel. In addition, toll roads across the country are free of tolls, further reducing the cost of private car travel. The demand for car purchase will gradually recover, and there may even be the possibility of concentrated demand outbreak in the second quarter, which is good for the whole industry chain.

"The automobile industry is different from catering and other service industries, and the epidemic situation is more caused by delayed demand." Zeng Qinghong, chairman of GAC Group, said that the impact of the epidemic situation is temporary. From the automobile industry, although unprecedented challenges are encountered, automobiles are rigid demand and have certain impact in the short term, but the overall situation is good. He also hoped that local governments would resume work in an orderly manner to ensure smooth logistics and parts supply. On the other hand, he hoped to introduce more fiscal and taxation measures, cancel license restrictions and encourage automobile consumption.

Wang Bin of the Ministry of Commerce also expressed his opinion that China's automobile market has great development space and potential, and automobile consumption demand is still strong. The impact of the epidemic on the automobile industry is phased. With the epidemic control and the gradual recovery of production and life, the compensatory consumption demand for automobiles in the later period will increase significantly.

The China Automobile Association estimates that the decline in car sales is temporary, but the speed of recovery depends on local government measures. If the policy implementation is strong and there is a comprehensive support policy for targeted traditional vehicles, at least the sales volume from April to December after the epidemic situation stabilizes will increase, and even the sales volume of the whole year will be pulled back to achieve positive growth.

From the analysis of the above-mentioned industry personages, there is indeed the possibility of a short-term rapid rise in China's automobile consumption.

Multiple policies or decompression rescue

The emergence of the epidemic has had a serious impact on automobile and other industries, so "actively stabilizing traditional bulk consumption such as automobiles" has become the top priority of the next discussion by the Ministry of Commerce. The new policy to promote automobile consumption is initially taking shape, and new measures to relieve the pressure on automobile enterprises/dealers are also expected to be introduced.

On February 20, the Ministry of Commerce held a press conference, clearly stating that it would thoroughly implement the important decision-making deployment of the Central Committee on "actively stabilizing traditional bulk consumption such as automobiles" and the spirit of Opinions of the General Office of the State Council on Accelerating the Development of Circulation and Promoting Commercial Consumption, and jointly with relevant departments to study and issue policies and measures to further stabilize automobile consumption, so as to mitigate the impact of the epidemic on automobile consumption.

At the same time, all localities are encouraged to introduce measures to promote the consumption of new energy vehicles, increase the purchase restriction index of traditional vehicles and carry out the trade-in of old vehicles according to local conditions according to changes in the situation, so as to promote automobile consumption.

This month, Foshan City, Guangdong Province, took the lead in becoming the first city to launch an automobile consumption incentive policy in 2020. In order to accelerate the transformation and upgrading of the automobile consumption market and promote automobile consumption, the city will grant a fund subsidy scheme of 2000-5000 yuan to each newly purchased vehicle for a period of one year. Subsequently, on February 21, the government of Guangdong Province issued "Several Policies and Measures to Further Stabilize and Promote Employment," proposing to promote qualified cities to introduce subsidy policies for scrapping and renewing old cars, and encouraging Guangzhou and Shenzhen to further relax car lottery and bidding indicators.

In order to stabilize the development of the automobile industry and ease the pressure on automobile enterprises, the China Association of Automobile Manufacturers has submitted proposals to the relevant competent authorities on delaying the implementation of the "National VI" emission standards.

Since July 2019, some provinces and cities in China have implemented the "National VI" emission standard in advance, and the policy stipulates that the whole country will enter the "National VI" era from July 1,2020, and the sales of the National V model will be prohibited.

"The proposal of China Automobile Association to delay the implementation of National VI emission standards can give enterprises more buffer time." Cui Dongshu, secretary-general of the association, also said,"This move can stabilize production and sales, prevent dealers from dumping five stocks when the days are very tight, and reduce the bankruptcy of dealers due to inventory risks."

On the whole, after the epidemic situation, the automobile industry is optimistic in the industry, the new policy is expected to be implemented to benefit the whole industry, stabilize such bulk consumption of automobiles or will not become empty talk. Will you be optimistic about the car market in 2020?

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