AutoBeta(AutoBeta.net)03/12 Report--

Entering 2021, the domestic new car market has achieved continuous year-on-year growth, due to the epidemic in the same period last year, the year-on-year data is of little significance. In February, affected by the late Spring Festival holiday this year, car production and sales almost halved, resulting in a rise in the inventory index of many brands. According to the latest report released by the China Automobile Circulation Association, the inventory of 15 car companies has seriously exceeded the standard.

The latest survey of "inventory of car dealers" released by the China Automobile Circulation Association in February showed that the comprehensive inventory coefficient of car dealers in February was 1.68, up 9.8 percent from the previous month. When the base affected by the epidemic last year was low, the inventory level fell 88.6 percent year on year, and the inventory level was above the warning line. Affected by these factors, there are as many as 15 brands with inventory depth of more than 2 months in February.

It is worth noting that the report also highlighted the three brands with the highest inventory depth in February, namely Dongfeng Yueda Kia, Baojun and Jaguar Land Rover.

Among them, Dongfeng Yueda Kia, as the brand with the highest inventory in February, has been in inventory for 2.41 months. However, this is not the first time the brand has been "named" by the association. Due to the marginalization of the market, the market share of many domestic joint venture brands has remained low. According to the report of the China Automobile Association, the market share of Korean brand models shrank again to 2.8% in February this year.

According to the Federation of passengers, Dongfeng Yueda Kia sold 17857 units a month in January 2021, down 2.74% from the same period in 2020, not much from the same period last year, but with a 25.7% year-on-year increase in the passenger car market in January this year. It's obviously amazing.

It is conceivable that during its highlight period, Dongfeng Yueda Kia had an annual sales of 650000 yuan in 2016, but now it has been "halved". According to the data, the sales of Dongfeng Yueda Kia from 2017 to 2020 were 359500 (- 4% year-on-year), 370000 (+ 2.8% year-on-year), 289900 (- 21.6% year-on-year) and 249000 (- 11% and 97%) respectively. The decline of Dongfeng Yueda Kia also represents the performance of some joint venture brands in China.

The share of domestic brands rose in February, but Baojun, the second-largest inventory brand this month, had an inventory index of 2.37 months, highlighting that it had lost its edge in its own brand market, according to the China Automobile Association.

Statistics show that the Baojun brand sold only 400000 vehicles in 2020. This is the third year in a row that the brand has declined, with Baojun selling 600000 vehicles in 2019 and 879000 in 2018, which shows that the brand's sales have also halved in just a few years.

In 2019, the Baojun brand also tried to change its logo to change its brand image, but its sales performance obviously did not come true. This is also because Baojun brand core technology is single, poor reputation and other factors affect its brand development. Although the new Baojun brand has as many as 7 models, it is only 1.5L self-priming and 1.5T turbine models. Last year it became the only brand on the 315 night list.

Nowadays, the reason for the rising market share of independent brands is also that some head independent brands contribute to the development of brands by constantly improving their core competitiveness. As the current new car market tends to be quality, brands without strength will eventually be marginalized.

Jaguar Land Rover, the third-largest luxury brand by inventory this month, is also one of the brands the association has identified as overstocked in the past two years, with 2.27 months of inventory in February. The main reason for being on the list is that the value of the brand in the Chinese market is declining until the sales volume of the brand shrinks.

Jaguar Land Rover sold 5595 units in the Chinese car market in January 2021, which is quite low, according to the Federation of passengers. Of these, Land Rover sold 3283 units in January, while Jaguar sold only 2312 in January. Obviously, this is a brand marginalized by the market.

It is worth noting that compared with other luxury brands, Jaguar Land Rover's models offer "huge terminal discounts" in the Chinese market, and even "30% discount tiger, 60% discount leopard, Cadillac waist cut" has become a symbol of the brand. In spite of this, Jaguar Land Rover's sales in the Chinese car market have not improved.

Recently, foreign media reported that Thierry Thierry Bollore, CEO of Jaguar Land Rover, said, "Jaguar Land Rover loses more than 100000 vehicles a year because of consumer concerns about product quality." Although officials have said it is a rumor, the Land Rover brand ended up at the bottom of the list, according to the US Automobile Market Reliability report 2021 released by J.D.Power, a US market research company.

In the current era of growing inventory, high inventory undoubtedly reflects whether the brand is easy to sell, and the above-mentioned named brands are all due to the reduction of brand power to the difficulty of selling models. In this regard, the association also said that dealers should rationally estimate the actual market demand according to the actual situation, and reasonably control the inventory level, so as to prevent excessive inventory pressure, leading to operational risks. However, the inventory index of many brands exceeded the standard in February, and inventory pressure increased due to the decline in sales volume during the Spring Festival in February.

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