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On May 4, the China Automobile Circulation Association released the "Research report on China's Automobile value retention rate in April 2023". Under the influence of the price war in China's car market in March, the large-scale price reduction of new cars had a direct impact on the price of used cars in April, and the preservation rate of used cars generally showed a downward trend in April.

In terms of subdivision, among all levels of preservation rates, the preservation rates of small cars, medium and large vehicles and medium and large SUV, MPV have all declined. Among them, the decline in the small car market is particularly obvious, with the preservation rate of 66.7% in April, down 1.3% from 68% in March, which may be due to the impact of a large number of new energy vehicles on the micro car market. In the past March-April, a number of new cars, including Wuling Colorado and BYD Seagull, have been on the market, or affected by this, the dual crackdown on new energy and new cars has lowered the value preservation rate of used cars. In the list, only compact cars and small SUV models with low positioning prices showed an increase in value preservation rate. China Automobile Circulation Association said: "low-cost cars have a large user base, a relatively large market share, can maintain a relatively stable preservation rate, and there is more room for price reduction for medium-and large-sized cars and high-value vehicles, so the downward trend of value preservation rate is more obvious than other classes of models."

In terms of the value preservation rate of national brands, among the 13 brands on the list in April, seven brands had 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 83.1%, while Lexus ranks second with a preservation rate of 77.3%. It is also the only one of the 13 brands on the list whose value preservation rate has increased, while Porsche and Tesla's value preservation rate has dropped greatly, of which the value preservation rate of Porsche used cars has dropped to 83.1% from 86.4% in March, down 3.3% from the previous month. In addition, Tesla was also affected by the price reduction of his new car, and the preservation rate of used cars fell to 54.4%, down 1.5% from the previous month. In the BBA camp, due to the little impact of the price war, the preservation rate of used cars did not change much in April. Although the preservation rates of the three car companies declined month-on-month, they all fell by less than 1 per cent, including Mercedes-Benz by 0.4 per cent, BMW by 0.6 per cent and Audi by 0.9 per cent. For other brands, the preservation rates of Land Rover and Acura in April were the same as in March.

In terms of joint venture brands, there are 6 brands with a preservation rate of more than 60%, of which the top three are Japanese brands. Toyota ranked first with a preservation rate of 70.1%, but fell 2.5% from 72.6% in March. Honda ranked second, and the preservation rate fell 0.4% from the previous month to 67.4%. The Mazda brand, which ranked third, had a value preservation rate of 61.6%, up 0.4% from March. Nissan, Volkswagen and Chevrolet also achieved growth, with Nissan having the highest increase, rising to 61.3% from 59.7% in March, up 1.6% from the previous month. Mitsubishi's preservation rate fell to 57.8% in April, down 2.6% from the previous month, making it the brand with the highest decline on the list, which may be related to Mitsubishi's performance in the domestic market. At the end of April, several media reported that Mitsubishi had stopped production of new cars and continued production of some parts at its plant in Changsha, Hunan province, due to persistent sluggish sales. Subsequent adjustments will be made according to inventory and sales environment, and new car production is expected to restart in June.

Let's take a look at independent brands. In April, independent brands were also affected by the price war, and the preservation rate also showed a general downward trend, but the decline was small, with Chuanqi, Changan and Roewe falling by 0.3%, 0.3% and 0.4% respectively. Judging from the whole list, in April, in the preservation rate of used cars, only Changan, Wuling, Chuanqi, NIO and the ideal preservation rate of Chinese brands are more than 60%, which still has a large gap compared with joint venture brands. China Automobile Circulation Association said: "while the sales of independent brands are rising by leaps and bounds, it is still a difficult problem for prices to rise."

As for the field of new energy vehicles, affected by the large-scale price reduction of new energy vehicles in March and the release and listing of a large number of new cars at the Shanghai Auto Show in April, the value preservation rate of used new energy vehicles also declined in April, of which the value preservation rate of plug-in hybrid models was 53.8%, down 1.1% from the previous month, and that of pure electric vehicles was 55.3%, down 1.5% from the previous month. The list shows that the preservation rate of plug-in hybrid models of luxury brands such as Porsche is still high, while in pure electric models, the preservation rates of models such as Collaway, BYD Dolphin, Euler Black Cat, Zero running T03 and Polar Krypton 001 are relatively high. Although fuel vehicles account for 90% of the used car market, the new energy vehicle market will develop rapidly. For example, at the Shanghai International Auto Show held not long ago, new energy vehicles have become the protagonists of the auto show and the iteration speed of new products is faster. Therefore, with the reform of the car market, the new energy used car market will also be developed.

Lu Guangzhi, deputy director of the Information Department of the China Automobile Circulation Association, said: "the sharp price reduction of new cars in March this year has had a greater impact on second-hand cars, and some models have even seen the price of new cars lower than the purchase price of used cars. as a result, many used car dealers have suffered relatively serious losses, and the market shows the market characteristics that consumers continue to wait and see the operation of second-hand car dealers." Industry insiders predict that the value preservation rate of second-hand cars will be difficult to get out of the downward trend in the short term.

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