In recent years, in the development rhythm of China's auto market, luxury cars seem to have always been a special existence.
Since 2018, China's auto market has bid farewell to high growth, and from the incremental market to the stock market, the competition in the auto market has become more and more intense. However, unlike the general environment, the market demand for luxury cars has always been stable.
According to the data of the Association of Passenger Vehicles, from 2018 to 2020, under the background of the "three consecutive falls" in the domestic car market, the cumulative sales of luxury cars in the Chinese market increased by 12.5%, 11.9% and 14.7% respectively year-on-year.
When everyone thought that luxury cars would maintain rapid growth, this segment ushered in an inflection point. In 2021, the cumulative retail sales of luxury cars in China were 2.65 million units, a slight increase of only 4.9% over the previous year, although it still outperformed the market by 0.5 percentage points, but signs of weak growth showed.
The situation is grim, the luxury car market "10 consecutive falls"
In fact, the luxury car market is in a much more dire situation than we think.
According to the data of the Association, as of March this year, the domestic luxury car market has been declining for 10 consecutive months. Factors such as the new crown epidemic, the rise in bulk raw materials, and the insufficient supply of chips have still caused an impact on the luxury car market.
In the first quarter of this year, the luxury car market sold about 680,000 units, down 7.5% year-on-year. Among them, in March, when the epidemic erosion was more serious, the sales volume of the luxury car market fell by 14%.
The limitation of production capacity also directly affected the market performance of the three BBA companies, bmw, Mercedes-Benz and Audi sold 208,500 units, 192,000 units and 161,600 units respectively in the first quarter, all of which declined to varying degrees year-on-year.
Among them, BMW continued the good momentum in 2021 and still maintained its lead in the three. In the first quarter, BMW's sales in China fell by 9.2% year-on-year. BMW pointed out that due to raw material supply problems, continuous chip shortages, and the outbreak of the epidemic in many parts of the country in recent times, the logistics and transportation of BMW imported and domestic vehicles have been greatly affected.
From January to March, Mercedes-Benz's sales in China fell by 13.7% year-on-year. It is worth mentioning that mercedes-benz previously announced an increase in the guidance price of some models, with an increase of 3,000 yuan to 76,000 yuan.
At the same time, plagued by the epidemic and the lack of core, the pick-up cycle of Mercedes-Benz imported cars is about 1-3 months. After Mercedes-Benz, BMW also adjusted the price, of which the 3 series, X3, X4, 4 series and Z4 models rose by 1600 yuan - 11,000 yuan.
Audi has been hit harder. According to data released by Volkswagen China, Audi sold 161,600 new cars in China in the first quarter, down 22% year-on-year. Affected by the epidemic, all five bases of FAW Group in Changchun were shut down, and Audi's main sales models A4L, A6L and Q5L were affected.
It is understood that on April 17, all five production bases under the FAW Group have resumed production and the whole vehicle has been rolled off the production line, and Audi's production capacity will gradually recover.
The macro economy is not optimistic
The reason for the downturn in the luxury car market is partly because the traditional luxury brands have been slower in the electrification transformation, so that they have not been able to ride the first express train of new energy rapid growth; more importantly, the impact on luxury cars at the macro level, due to the slowdown in macroeconomic growth, the performance of luxury brand cars in the Chinese market continues to cool.
As we all know, the automotive industry is an important pillar industry of the national economy, one is because the automobile industry accounts for a relatively high proportion of the national economy, and the other is that the automobile industry chain is huge, the employment is wide, the consumption pull is large, and it plays an important role in the national economic and social development.
As an important industry of the national economy, there is an intrinsic and inevitable connection between the automobile industry and the macro economy, and the continuous decline of the domestic luxury car market to a certain extent also reflects the economic prospects.
Indeed, 2022 is a year of uncertainties in the mainland's economic development, with wars, COVID-19, changes in oil prices and trade frictions adding a lot of variables to China's economy and the auto industry.
Today's downturn in the luxury car market has sounded the alarm for the automotive industry. Under the dual pressure of the deterioration of the external environment and the adjustment of domestic policies, the domestic automobile industry may face greater risks, and major car companies should be prepared to deal with the crisis in a timely manner.
Consumption upgrading is not more and more expensive to buy
In addition to the decline in the luxury car market, in the first quarter, the mainland narrow passenger car market also fell by 4.5% year-on-year, behind which there were both supply-side reasons for insufficient supply under the influence of the epidemic and consumer-side factors such as weak consumption. All in all, the mainland passenger car market is under full pressure.
In the current economic environment, more consumers will choose to tighten their wallets, reduce large consumption, and choose more cost-effective products. In this case, there may be more people who do not buy luxury cars, however, the trend of automobile consumption upgrading has not ended, on the contrary, people have put forward higher requirements for "automobile consumption upgrading".
In the past few years, the hot sales of luxury brand cars have made some people think that "consumption upgrade" is that there are more and more rich people and more expensive cars are bought, which is a pure misunderstanding.
On the one hand, consumption upgrading is not "the more you buy, the more expensive", but "the more you buy, the better". For example, consumers used to buy ordinary fuel vehicles, and now buy oil mixtures and dm-i, which is also a manifestation of consumption upgrading.
On the other hand, as a developing country, the mainland does not have so many "rich people". According to the National Bureau of Statistics, the median per capita disposable income of residents in 2021 is 29,975 yuan, less than 30,000 yuan; of which the median per capita disposable income of rural residents is less than 20,000 yuan, which is 16,902 yuan.
According to the U.S. Department of Labor, the per capita GDP of the United States in 2021 will be around $38,000 (about 245,000 yuan), far exceeding that of the mainland.
This fully shows that for Chinese consumers, consumption upgrades are definitely not "more and more expensive", and with the current per capita GDP, 100,000 is still the consumption range that best meets the needs of domestic consumers.
Therefore, car companies should be committed to bringing "better and better" products to domestic consumers, not "more and more expensive" products.
At present, some emerging "high-end" brands on the market have gone astray, such as Weilai and Zhiji, which are priced at more than 300,000 and 400,000, and the market performance is becoming more and more weak; and high-end brands like Hongqi, whose well-selling models are also H5, HS5 - products priced at 100,000-250,000 yuan.
Therefore, the real "consumption upgrade" is not only the choice of models with higher prices by users with strong purchasing power, but also the new models that consumers can choose in terms of design, quality, safety, technology, power and other product strengths under the same budget.
To put it bluntly, value upgrading is the core performance of "consumption upgrading". It is foreseeable that in the future market environment of more and more involution, if car companies want to occupy a place, they need to be more down-to-earth and carefully study the actual needs of users and create automotive products that users really need.
Text | Huluwa
(This article is the author's personal opinion only and does not represent the position of DearAuto.) )
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Mr. Li Guoyong of Guangdong Green Law Firm