Image source: Visual China
In 2021, the cumulative transaction volume of China's used car market was 17.5851 million units, an increase of 22.62% year-on-year, an increase of 17.84% over 2019 before the arrival of the new crown epidemic, which is one of the few markets that is still growing rapidly during the epidemic.
ByteDance has also taken a fancy to this market.
The editor of the Titanium Media App learned from people close to ByteDance that ByteDance's second-hand car project has long been launched internally and prepared for a long time. The name of the project is likely to be defined as "understanding good cars" to distinguish it from its auto media understands car emperors.
As shown in the above figure titanium media App editing query, as early as April 2021, Chongqing Wanxiang UCAR Technology Co., Ltd. completed registration in Jiangbei District, Chongqing, and the enterprise investigation data showed that the legal representative Li Fei was also the legal representative of Beijing Zhichedi Technology Co., Ltd. Chongqing Vientiane UCar's business scope includes "car new car sales, car used car sales, used car distribution" and other businesses, and its ultimate beneficiary column Zhang Yiming is listed prominently.
Six months later, ByteDance added foreign investment through its affiliate Beijing Youzhuju Network Technology Co., Ltd., with 100% shareholding in Yuechi Qianlu Youche Automobile Sales Service Co., Ltd. in Guang'an, Sichuan Province. The registered capital of the company, which covers the business scope of "automobile new car sales, automobile used car sales, second-hand car distribution, second-hand economy", is 1 million yuan, and the legal representative Li Han is related to 12 enterprises, and also serves as the legal representative of Beijing Guagualng Technology Co., Ltd., the main force of ByteDance in the K12 field. In January this year, Li Han once again became the legal representative of Chongqing Spatial Change Technology Co., Ltd., which also had the same content as Yuechi Qianlu in its business scope.
Is this a decisive turn after ByteDance folded its online education business? But the used car market, which used to be chased by deer and folded, is not so easy.
Traffic giants want to do offline physical business
ByteDance has always been very profitable.
In 2021, ByteDance's total revenue will be about US$58 billion, equivalent to about 370 billion yuan, which is equivalent to 10 small targets for Wang Jianlin to open its doors every day.
However, Zhang Yiming is not satisfied with this, and the year-on-year increase in revenue in 2021 is only 70%, which is slightly inferior compared with the year-on-year increase of 111% in 2020. In addition, advertising revenue accounts for too much of ByteDance's total revenue, advertising revenue accounted for more than 85% of ByteDance's total revenue in 2019, and advertising revenue of 183 billion yuan in 2020 still accounts for nearly 80% of total revenue, which shows that ByteDance's dependence on advertising revenue has never been able to get rid of. As a traffic consumption product, advertising and user experience are a pair of contradictions, and On the road of relying on advertising monetization, ByteDance has touched the ceiling. For the $400 billion company, if it wants to tell a beautiful story in the capital market, it must do a good job of operating the existing traffic.
Chen Duye, vice president of marketing of ByteDance's official marketing service brand Mega Engine, once said: "We need to change from traffic-driven to business-driven. ”
It is said that ByteDance has invested about 10 billion yuan in the teaching track where projects such as Vigorous Education are located. (Source: Visual China)
So from 2019 onwards, ByteDance went all out to lay out the education track. Study well, vigorously educate, Guagualong, you shoot one, GOGOKID, Qingbei Online School, Xuelang... One project after another has been launched, and Byte insiders told Titanium Media App that nearly 10 billion yuan was smashed on the above-mentioned internal entrepreneurial projects in a short period of time.
Depressed, on July 24, 2021, the General Office of the CPC Central Committee and the General Office of the State Council issued the Opinions on Further Reducing the Homework Burden and Off-campus Training Burden of Students in the Compulsory Education Stage, and the double reduction policy collapsed its education empire overnight. If it were not for the hedging of risks for the content platform to earn back tens of billions of advertising fees from other education companies for ByteDance, ByteDance's loss in the education industry would be almost irreparable.
After the setback in the layout of the education track, byteDance Chongqing Company's business scope appeared in July 2021, and soon after, ByteDance Hong Kong Company added Fujian Haofang Youxing Information Technology Co., Ltd. after adding real estate brokerage business to its business scope. Wang Fengkun, the legal representative of ByteDance (Nanjing) Technology Research and Development Co., Ltd., became the legal representative of the Fujian company, and he is also associated with 34 other companies, the vast majority of which are inextricably linked to ByteDance.
Subsequently, ByteDance has established more than 10 real estate brokerage companies, and the legal representatives are Wang Fengkun. It is worth mentioning that Wang Fengkun was the legal representative of three branches of Beijing Xuehai Yangfan Education Technology Co., Ltd., and the actual controller of Beijing Xuehai Yangfan Education Technology Co., Ltd. is Beijing Youzhuju Network Technology Co., Ltd. mentioned at the beginning.
By acquiring a subsidiary of Wheatfield, ByteDance obtained key filing documents. (Source: Visual China)
On September 28, 2021, ByteDance wholly acquired Beijing Fuwang Real Estate Brokerage Co., Ltd., a subsidiary of Beijing Maitian Real Estate, and obtained the filing documents, which are the necessary conditions for carrying out real estate brokerage activities in the Administrative Measures for Real Estate Brokerage, which enables ByteDance to finally carry out offline real estate intermediary business in a legal and compliant manner.
However, the real estate agency business cannot meet ByteDance's pursuit of the physical business model, so the very traditional second-hand car business has become a new target of ByteDance.
The muddy waters of used cars may not be as good to ride
Before opening a second-hand car offline store in Chongqing, ByteDance's auto media understood Chedi and opened a new car showroom in Shancheng. Different from the multi-brand car source showroom provided by many dealers we see today, according to the Titanium Media App from ByteDance insiders, the earliest car emperor planned to operate this experience store in the heart of Chunfeng City in a direct mode, but under the joint resistance of local dealers, it had to rent the store to a local dealer to sell cars in the store.
Since the environment is so harsh? Why did ByteDance still choose the first stop of the used car business in Chongqing?
If you look at the trading volume of China's six major used car markets in 2021, you will find that the southwest region where Chongqing is located and can radiate sold 2.5035 million used cars last year. Among the six regional markets, the southwest region ranks fourth, the results are not bad, and it is more than enough to raise a company for the pilot; the results are not good, and they will not attract more attention from the outside world.
However, the chaos in the used car market should not be underestimated.
Although the annual trading volume of used cars in China has increased year by year in recent years, most of the models it sells are mainly low-end products. Among the 17.5851 million used cars sold in the Chinese market in 2021, the proportion of models with a transaction price of less than 30,000 yuan is 32.55%, which leads to the overall total transaction volume of the second-hand car market is less than a quarter of the new car market, lacking the imagination of capital.
Second, the essence of the used car business in China is the price difference generated by the opaque information between upstream and downstream. Among them, the opaque is not only the price, but also the negative reputation of users caused by the intentional concealment of accidents and maintenance records by upstream car dealers, which will bring an unexpected public relations crisis to ByteDance.
Third, used cars are a highly dependent offline heavy asset business, and all merchants who are deeply involved in transactions will fall into the dilemma of high costs, and the long-term occupation of funds will lead to a sharp decline in gross profit levels. As an Internet company accustomed to high profit margins, can ByteDance accept the great contrast between high unit price and high cost and low profit and low transaction frequency?
What's more, ByteDance will have to deal with family-run car dealers who have been in this market for many years, who have more experience, lower bottom lines and more diverse means. A car dealer in Beijing's Huaxiang once happily said that he "likes the wool of these big Internet factories the most", because it is really "they are full of loopholes, too good to deceive." ”
The former used car top three has become yesterday's yellow flower. (Source: Visual China)
Previously, there were many cars, renren cars, Uxin, including melon used car e-commerce days were not good.
The C2C model that once copied the American Beepi in the United States has been a large-scale layoff after being exposed to the capital chain problem in 2019, and the number of employees has been reduced from nearly 10,000 to more than 200 people, and the offline car collection and evaluation business has been unable to be carried out. Recently, the news that its affiliates have been enforced due to arrears in promotion fees has been reported, which is lamentable.
Cheduoduo Group, which is integrated from the three major businesses of Guazi used car, edamame new car and cheduo car, has not been able to let Guazi used car have a beautiful financial statement for several years, even if multiple rounds of financing are declared successful, it seems that it is far from the IPO.
ByteDance, is it really ready to jump into the quagmire of used cars? (This article was exclusively published on the Titanium Media App, author: Workers' Stadium North Gate)
It is hoped that the second-hand car business will allow Zhang Yiming to no longer be troubled by the boundary between traffic drive and business drive.