AutoBeta(AutoBeta.net)05/11 Report--

The car market finally warmed up in April! According to the data, China's automobile production and sales completed 2.102 million and 2.07 million respectively in April, up 46.6% and 43.5% respectively from the previous month, and 2.3% and 4.4% respectively over the same period last year. The monthly growth rate was the first increase since the beginning of this year, and sales volume ended 21 consecutive months of decline.

However, some brands have to face the difficult days of terminal sales. The latest survey of "inventory of car dealers" released by the China Automobile Circulation Association in April 2020 shows that the comprehensive inventory coefficient of car dealers in April was 1.76, down 12.0% from the same period last year, and 34.3% from the previous month, and the inventory level dropped sharply. But it's still above the warning line.

It is worth noting that the report also specifically points out that the inventory depth of 7 brands is more than 2.5 months, namely Skoda, GAC MOTOR, Roewe, SAIC Volkswagen, Jaguar Land Rover, Beijing Hyundai, Dongfeng Yueda Kia; among them, the three brands with the highest inventory depth are Skoda, GAC MOTOR and Roewe.

SAIC Skoda is one of the joint venture brands marginalized by the market. Due to market pressure, Skoda brand took the lead in initiating official price reduction measures in April this year to lower brand positioning and strive for survival.

Skoda brand has been developed around SAIC-Volkswagen brand in China for many years and is regarded as a "cheap Volkswagen". However, with the decline of the brand and declining sales, Skoda has a growing desire to develop independently. According to official information, official health means that Skoda brand will lose its "cheap version" Volkswagen label and develop independently.

On the issue of falling pricing, SAIC Volkswagen executive Jia Mingdysi said: "in the past, there was a large gap between Skoda's suggested retail price and the market terminal discount, and the higher suggested retail price caused customers to make an initial choice. Skoda brand will not be taken into consideration." The reduction of the suggested retail price will help it to better approach the target users, but also out of medium-and long-term plans and considerations.

Skoda sold 282000 vehicles in China in 2019, down 17% from a year earlier, according to data. Skoda had previously set a target of selling 500000 vehicles a year. Enter 2020, Skoda's further expansion.

GAC MOTOR dealer inventory depth of 3.07 months in April, is the second largest brand in inventory. According to official data, GAC MOTOR's sales are not bad, with sales of 22271 vehicles in April, down 17% from a year earlier to 84739 vehicles from January to April, down 26.23% from a year earlier. However, from the inventory level, it may mean that GAC MOTOR wholesale and terminal sales do not match the phenomenon.

In terms of products, GAC MOTOR's car field has almost lost its edge, and it is difficult for SUV to compete with first-tier independent brands. For example, GS4 has sold more than 20, 000 units a month, which is the main competitor to Harvard H6, Geely Boyue, Changan CS75, etc., but now it sells less than 10, 000 units a month.

Roewe brand April dealer inventory depth of nearly three months, but also reflects the manufacturer's wholesale sales and terminal retail sales imbalance.

In addition, SAIC-Volkswagen, Jaguar Land Rover, Beijing Hyundai and Dongfeng Yueda Kia have also had more than 2.5 months of dealer inventory, which is a dangerous signal for manufacturers. Among them, SAIC-Volkswagen brand is one of the brands with large domestic sales scale, which has caused a continuous blow to SAIC-Volkswagen brand due to product problems, exposed safety problems and other reasons.

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