Before the Spring Festival, the car market is "not weak in the off-season"

Lu Jiangtao, a reporter from China Economic Weekly, | Beijing

Judging from past data, the month of spring festival and the month after the spring festival are the traditional off-season of automobile sales. On the one hand, it is because many potential consumers are busy returning home or traveling during the Spring Festival holiday, and on the other hand, because the sales tasks of the 4S store in the previous year have been completed, and there are usually no targeted preferential activities during the Spring Festival.

However, the Spring Festival in these two years is somewhat special, and while the number of Spring Festival returnees has been sharply reduced, it has also quietly heated up the automobile market. In response to this situation, many car manufacturers and dealers have also prepared a variety of services and promotional activities, in the past around the Spring Festival, the 4S stores in the door may usher in a wave of "market".

Among them, new energy vehicles are still the biggest highlight of this year's automobile market, according to the Ministry of Industry and Information Technology's official WeChat "Industrial Information Micro", in 2021, the mainland new energy vehicle sales completed 3.521 million units, an increase of 1.6 times, 2022 will still maintain a high-speed trend. According to the forecast of the Federation of Passenger Vehicles, the sales volume of new energy passenger vehicles this year is expected to reach more than 5.5 million units, and the penetration rate will reach about 25%.

The traditional off-season car market is hot

The 2022 Lunar New Year is earlier than usual, which means that the traditional off-season for car buying will be brought forward to January. Recently, a reporter from China Economic Weekly visited a number of 4S stores in Beijing and found that the "popularity" of the car market in 2022 is very sufficient, and many popular models in 2021 are still "sought-after".

"This year's New Year is early, but there is no 'Spring Festival effect' in previous years, and there are still many customers in the store to see the car these days." The sales staff of a BYD 4S store on the outskirts of Beijing told the "China Economic Weekly" reporter that their store continued the hot market in 2021 at the beginning of 2022, and the order queue for pure electric models such as Han EV and Song PLUSEV took more than a month, and the queue cycle of DMI models was longer, taking about 3 months. "BYD has sold very well in the past two years, and the situation of other stores in Beijing should be similar to our side, because there are also customers who feel that the queue time is too long after booking in other stores, and then cancel the booking, and finally book in our store." The salesman told reporters.

Similar to BYD, the reporter also saw a lively scene in the 4S stores of first-line independent brands such as Geely, Great Wall, and Changan, and many hot-selling models also needed to queue. Among them, the queue period of Great Wall's tank 300, Geely's kung fu cattle and other models is not shorter than that of BYD's hot models.

In terms of joint venture vehicles, Volkswagen, Toyota, Honda, Nissan and other model sales are also better than in previous years, of which SAIC Volkswagen and FAW-Volkswagen's A-class car discount is larger, and although the preferential range of the 3 Japanese car companies is not as good as Volkswagen, the car pick-up cycle is shorter, and some models can be used before the Spring Festival.

The data recently released by the Association of Automobile Associations can more intuitively show the popularity of the car market before the Spring Festival. The data shows that in the first week of January, the retail sales volume of the narrow passenger car market was an average of 58,000 units per day, an increase of 6% year-on-year and a 27% increase from the first week of December 2021.

According to the analysis of the Association of Automobile Manufacturers, due to the obvious improvement in automobile production from October to December 2021, the retail sales in January 2022 rebounded significantly, and continued to strengthen compared with the same period in 2021. In recent months, terminal inventory has improved, and manufacturer promotions have been stable, making retail sales grow. In addition, due to the needs of epidemic prevention and control, the just-needed effect of car purchase and transportation is more prominent, and overall, retail before the Spring Festival is still a strong trend.

Its own brands are popular

Looking back at the auto market in 2021, the sales of new energy vehicles are the biggest highlight.

On January 12, statistics released by the China Association of Automobile Manufacturers showed that in 2021, the production and sales of mainland automobiles reached 26.082 million units and 26.275 million units, respectively, an increase of 3.4% and 3.8% year-on-year, ending a three-year downward trend.

Among them, the sales of new energy vehicles reached 3.521 million units, an increase of more than 1.6 times year-on-year, ranking first in the world for seven consecutive years. Specifically, the production and sales of pure electric vehicles reached 2.942 million units and 2.916 million units, respectively, an increase of 1.7 times and 1.6 times year-on-year, respectively; the production and sales of plug-in hybrid vehicles reached 601,000 units and 603,000 units, respectively, an increase of 1.3 times and 1.4 times year-on-year, respectively.

In addition to traditional OEMs, new car manufacturers have also played an important role in the process of industrial transformation and upgrading, and have performed in market segments. In 2021, new car manufacturers sold a total of 947,000 vehicles, an increase of 2.2 times year-on-year, and the market share was 3.6%, an increase of 2.4 percentage points over the previous year.

It is worth noting that the layout of independent brands in the new energy vehicle track is earlier, and the first-mover advantage is obvious.

Fu Bingfeng, executive vice president and secretary general of the China Automobile Association, said that from the perspective of the trend of new energy vehicles, the development of production and sales in 2021 has maintained a booming development situation, with monthly sales of more than 200,000 vehicles in March, more than 300,000 vehicles in August, more than 400,000 vehicles in November, and more than 530,000 vehicles in December, showing a sustained growth momentum. In 2021, China's brand new energy passenger vehicles sold 2.476 million units, an increase of 1.7 times year-on-year, accounting for 74.3% of the total sales of new energy passenger vehicles.

In addition to sales, in 2021, mainland new energy vehicles in the field of innovation achievements are also bright spots, sustainable development capabilities are further enhanced, the energy density of power battery cells is close to 300 Watt Hours / kg, the system energy density is more than 200 Watt Hours / kg, the intelligent networked vehicle on-board basic computing platform to achieve loading applications, and the computing power of artificial intelligence chips has reached the international advanced level.

Looking ahead to 2022, the China Association of Automobile Manufacturers expects total vehicle sales in mainland China to reach 27.5 million units, up about 5% year-on-year. Among them, passenger cars will be 23 million units, an increase of 7% year-on-year; commercial vehicles will be 4.5 million units, down 6% year-on-year; new energy vehicles will reach 5 million units, an increase of 42% year-on-year, and the market share is expected to exceed 18%.

The Federation believes that according to the latest released policy, the current purchase subsidy technical indicator system framework and threshold requirements will remain unchanged in 2022, and the subsidy scale for new energy vehicles will be realized throughout the year from the original expected upper limit of 2 million vehicles to no upper limit. With the doubling of the scale of the new energy industry chain and the improvement of cost reduction capabilities, it is expected that the increase in new energy vehicles in 2022 will be very strong. Originally expected to sell 4.8 million new energy passenger vehicles in 2022, it is currently estimated to reach more than 5.5 million units, and the penetration rate of new energy passenger vehicles will reach about 25%.

Editor-in-charge: Guo Jiyao

(The copyright belongs to China Economic Weekly Magazine, and no media, website or individual may reprint, excerpt, link, repost or otherwise use it without authorization.) ）