AutoBeta(AutoBeta.net)05/01 Report--

The China Automobile Circulation Association released the "Automobile Dealer inventory early warning Index" in April, which reached 61% in April, up 5.7% from the previous month and 6.47% from a year earlier, and the inventory early warning index is still above the warning line.

In the process of intensified market competition, the current situation of car dealers has not changed much, and inventory is still at a high level.

Since 2018, the dealer inventory index has exceeded the warning line for 16 consecutive months.

The association pointed out that the Spring Festival auto show in some areas in April played a certain role in promoting sales, but market demand and sales still declined due to the general environment. Due to the implementation of the "national six emission standards" in July, consumers in some areas wait and see the policy of switching between national six models and hold money for purchase.

According to the sub-brand type index, the inventory early warning index of independent brands is still the highest, reaching 69.2%; both luxury brands and mainstream joint venture brands are close to 60%, of which the luxury brand inventory index rose by 9.1%.

It should be pointed out that the inventory early warning index takes 50% as the limit, and less than 50% is in a reasonable range. The higher the inventory early warning index, the lower the market demand, the greater the inventory pressure, the greater the operating pressure and risk.

The Circulation Association also said that the May Day holiday may usher in a small and the best part of car purchase, but the overall market situation in May is still difficult. In some areas, the sixth grade switching is approaching, and there is a lot of pressure to clear the warehouse.

In fact, under the environment of the decline of the domestic car market, the contradiction between dealers and manufacturers is becoming increasingly serious, and the rights protection events caused by "inventory", "increased operating pressure" and "loss operation" continue to occur, mostly concentrated in independent brands and joint venture brands that are not in the mainstream, such as Guangzhou Auto Fick Jeep dealers' collective rights protection, BAIC Magic Speed, Guanzhi, Baowo automobile dealers' rights protection and so on. At the same time, the changes in the market also reflect that consumers' car demand is changing, thus speeding up the survival of the fittest in the market.

In addition, the VAT reduction policy has not brought much substantial change to the market sales volume. It is reported that the National Development and Reform Commission is formulating relevant policies to stimulate car consumption. Documents circulated online show that the National Development and Reform Commission has drawn up an implementation plan to promote automobile consumption, explicitly forbidding all localities to issue new car purchase restrictions, and increasing the number of license plate increments of places that have been restricted in 2019 and 2020 by 50% and 100% respectively on the basis of 2018; there are no restrictions on the purchase of new energy vehicles; and speed up the lifting of restrictions on the entry of pickups into cities.

The NDRC also responded that it is learning about policies to stimulate automobile consumption, and that any policy should be repeatedly demonstrated and fully solicited by the parties concerned.

Cumulative sales of passenger cars in China reached 5.077 million in the first quarter of this year, down 10.5 per cent from a year earlier, according to FIFA sales data.

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