AutoBeta(AutoBeta.net)08/10 Report--

A document from a dealer in Hunan Province to Beijing Hyundai went viral on the Internet. According to the letter, in view of the great inventory pressure of all dealers in Hunan Province, very difficult operation, serious losses and other factors, all dealers in Hunan unanimously requested that they temporarily stop picking up cars to Beijing Hyundai from August 8, 2024, and no longer accept automatic distribution of vehicles. In addition, Beijing Hyundai will immediately resolve the existing inventory of dealers in Hunan and fulfill all previous commitments and incentive policies.

It is understood that most of the sealed Hunan dealers have registered capital of about 10 million yuan, and their distribution addresses are respectively in Changsha, Yongzhou, Yiyang, Yueyang, Chenzhou, Changde, Loudi, Shaoyang, and other places, covering most of the important cities in Hunan. From the content of the letter, the pressure of inventory and sales is the main reason why Beijing modern dealers jointly suspend the purchase of goods.

At present, a number of dealers have confirmed the authenticity of the letter to the media. Dealers say they need to pick up the car every month to get terminal rewards, a bundled operation that puts dealers in a dilemma of increasing inventory and narrowing profit margins. According to the China Automobile Circulation Association, the inventory coefficient of car dealers was 1.5% in July, with a total of six brands with an inventory coefficient of more than 2%, of which Beijing Hyundai ranked second with 2.45%.

Hyundai Motor Group sold 3.6159 million vehicles worldwide in the first half of this year, second only to Toyota and Volkswagen, but Hyundai and Kia do not have a strong sense of presence in the highly competitive Chinese market. Beijing Hyundai sold 94300 vehicles in the first half of the year, ranking 30th among domestic car brands, according to retail data. Due to the loss of selling cars, many dealers have to choose to withdraw from the net. As of August, there were 551 Hyundai dealers in Beijing, according to the Beijing Hyundai website.

With the sharp decline in the market share of fuel vehicles, in the past two years, many automobile companies have sold their factories to lose weight, and the "shutdown and merger" has been staged in the field of joint venture brands. Of the five factories that once boosted Beijing Hyundai's sales of millions, Beijing Renhe is the only one left to visit, according to the Beijing Hyundai website.

In 2024, it will be another difficult year for Korean brands. Hyundai Motor Group is responsible for the development of Korean brands in the Chinese market, but whether it is Beijing Hyundai, Yueda Kia or Genisse, the performance in the domestic market is getting less and less optimistic. In July this year, the penetration rate of new energy vehicles exceeded 50% for the first time, surpassing 840000 conventional fuel vehicles with a score of 878000. In other words, fuel cars can no longer sell new energy vehicles, and the future growth potential of the Chinese market still depends on new energy vehicles. In contrast, Beijing Hyundai has very few new energy vehicles on sale, which can be said to be one of the most slowly transformed joint venture brands. at the same time, the lack of competitiveness of fuel vehicles compared with the brands of the same industry has led to a continuous decline in sales. dealers have to sell cars at a loss in order to complete the factory's sales task.

Hyundai Group is speeding up its adjustment in China. In the Chinese market, Hyundai will sell eight models from the current 13, and plans to sell high-end models such as the Genisseth in Shanghai. In addition, in order to enhance the damaged brand image, Hyundai will focus on high-performance models. According to the plan, Beijing Hyundai will realize the full hybrid of fuel vehicles in 2025, and build a hybrid product matrix of one MPV, two cars and three SUV models in the next 3-5 years, reaching the annual production and sales scale of 300000 hybrid products.

It is worth noting that in the current fierce competition in the auto industry, Beijing Hyundai is not the only automaker whose conflict with dealers has been put on the table. Porsche dealers in China have also jointly protested for subsidies for loss-making car sales, probably also affected by weaker end demand and a market price war.

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