AutoBeta(AutoBeta.net)04/05 Report--

On April 3, the China Automobile Circulation Association released the Research report on China's Automobile value retention rate in March 2023. The report shows that in March 2023, under the influence of car subsidies and price cuts, the prices of used cars were upside down and suffered certain losses. The "quasi-new cars" in the second-hand market became the hardest hit, but the prices of older second-hand cars remained stable. Generally speaking, the price of used cars will also fall when the prices of new cars are reduced, but the report points out that the market may be able to recover after the end of time-limited subsidies.

First, let's take a look at the value preservation rate of each class of models within three years. According to the March data, with the exception of compact cars and small SUV, the three-year preservation rate of compact cars and small SUV is less than 60 per cent, other market segments are more than 60 per cent, of which the medium and large SUV has the highest three-year preservation rate of 70.7 per cent, but fell 0.6 per cent month-on-month, while the MPV has the biggest price drop this month, with a three-year preservation rate of 60.9 per cent and a 1.4 per cent drop from February. The report shows that medium-sized cars are still high-quality products in the second-hand market, other classes of price-cut models will face a "liquidity crisis", while electric cars will be the first to hit the small car market segment.

In terms of the value preservation rate of national brands, among the 13 brands on the list in March, there were 7 brands with a three-year preservation rate of more than 60%. They are Porsche, Lexus, Mercedes-Benz, BMW, Land Rover, Audi and Lincoln. Porsche continues to rank on the list with a preservation rate of 86.4%, while Lexus ranks second with a preservation rate of 77.0%. Audi still lags behind Land Rover since January, with the preservation rate falling to 62.2% in March. Other rankings are relatively stable. Overall, under the impact of the "price war", the preservation rates of most luxury brands that do not participate in price reduction subsidies have declined slightly, including BBA, Land Rover, Infiniti and Acura. The preservation rates of other brands have increased, of which Tesla's preservation rate has slightly increased by 0.5% to 55.9% from the previous month.

In terms of joint venture brands, there are six brands with a preservation rate of more than 60%, of which the top two on the list are Japanese brands. Toyota ranks first with a preservation rate of 72.6%, but it is down 0.4% from February. Honda ranked second, and the preservation rate fell 0.2% to 67.8% from the previous month. The third-ranked JEEP brand has a value preservation rate of 62.3%, down 1.8% from February, making it the brand with the highest increase on the list. as for the reason for the decline, the report pointed out that it was affected by the suspension of production and sale of domestic models of the JEEP brand. On the whole, Ford and Mazda were the only joint venture brands with higher preservation rates in March, in which Ford surpassed Volkswagen brands with a preservation rate of 60.2%, while the value preservation rate of Citroen, which ranked last, also dropped 0.4% to 46.6% from the previous month. It should be noted that in early March, Dongfeng Group launched a substantial subsidy for joint government-enterprise car purchases in Hubei, with a significant reduction in new cars. The price of the Dongfeng Citroen C6 dropped by 90, 000 yuan to only 120000, making the Citroen C6 one of the hottest models in March, but the price of used cars also falls when the price of new cars is reduced.

Let's take a look at independent brands. The ranking of independent brands in March has not changed much compared with February. A slight change is that NIO surpassed Lectra in March, ranking fifth on the list, with a three-year preservation rate of 60%. Since leading Wuling brand in January, Chuanqi brand has been at the top of the list for three consecutive months, with a preservation rate of 64.2% in March, an increase of 0.4% compared with the previous month, followed by Wuling, Changan and ideal, with a preservation rate of 62.8%, 60.8% and 60.1% respectively in March. The preservation rates of these brands have all increased compared with the previous month, and Harvard ranked seventh with a preservation rate of 59.3%. The same month-on-month growth was also achieved. The rest of the brands are down or flat with February. The report said that the high-end of traditional brands still face difficulties, such as Wei Brand and Red Flag are still lower than Changan, Roewe and so on in the preservation rate index.

Finally, let's take a look at the class of domestic medium and large cars with more than 400000. In this class, Mercedes-Benz ranked first with a preservation rate of 85.9 per cent, and in March, ET7 surpassed BMW's 5-Series with a preservation rate of 80.5 per cent.

Automobile value preservation rate is an important part of the performance-to-price ratio of cars, which has a high reference value for consumers to buy cars, but also reflects the market recognition of new cars to a certain extent. The so-called preservation rate refers to the ratio of the circulation price of second-hand cars to the ex-factory price of new cars, which can be simply understood as the circulation price of second-hand cars divided by the price of naked new cars. The higher the value preservation rate means that consumers bear less economic losses caused by product devaluation, and it is also the embodiment of brand premium and product value. Of course, "Automotive Industry concern" believes that there are many factors that affect the value preservation rate of vehicles, including the number of cars in the market, product popularity and market terminal concessions are all potential factors, therefore, the car value preservation rate is not the only criterion to judge whether the model is good or bad.

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