Auto dealer network reshuffle: the rise of independent brands, joint venture brands accounted for up to 57% of the network

21st Century Business Herald reporter Du Qiaomei reported from Beijing

"The value chain of the automobile industry is accelerating the reconstruction, the automobile market is facing unprecedented challenges and opportunities, will put forward higher requirements for the circulation industry, on the one hand, the knockout race of brand manufacturers began to accelerate, followed by the change of circulation channels, the second-hand car business will become the most core strategic business segment of dealers; on the other hand, new energy vehicles have sprung up, the market penetration rate has increased rapidly, and the proportion of individual car purchases has increased significantly, which is expected to be 1-2 in advance." Achieve the goal of new energy vehicle sales accounting for more than 20% of new vehicle sales. ”

On April 27, Xiao Zhengsan, vice president and secretary general of the China Automobile Circulation Association, said at the 2022 Blue Book Forum of the Automobile Circulation Industry that the exploration of channel models triggered by new energy vehicle products around the world is forcing the automobile circulation industry to accelerate its transformation and upgrading.

The "2021-2022 China Automobile Circulation Industry Development Report" (hereinafter referred to as the "Report") released on the same day shows that in the past 2021, China's automobile dealer network is undergoing a reshuffle, and the network of different brands of dealers is in conflict.

China Automobile Dealers Association's channel network statistics for 25 ultra-luxury and luxury brands, 19 joint venture brands and 54 independent brands totaling 98 passenger car brands show that at the end of 2021, the number of passenger car 4S sales service networks in the country was 29,318, adding 2,468 new ones, an increase of 3.9%; at the same time, the 4S sales service network that withdrew from the network in 2021 was about 1,400, of which the joint venture brand withdrawal accounted for 57%.

It is worth noting that in 2021, the explosive growth of new energy vehicles, the strong rise of independent brands, driving the expansion of channel networks, BYD, Changan, Chery, Xiaopeng, Nezha Automobile has made important contributions to the growth of channel networks; the number of networks in eastern provinces is large, and the network growth rate in western provinces is high; the proportion of county 4S networks has exceeded 15%; the channel formats of new energy vehicles are diversified, and the development of commercial supermarkets is particularly rapid.

Dealer networks are in a dilemma

"The growth of the dealer network mainly comes from two aspects, one is the luxury brand represented by Mercedes-Benz, BMW, Audi, Lexus and Volvo, and the other is the new force and independent brand." Lang Xuehong, deputy secretary-general of the China Automobile Dealers Association, pointed out, "Weilai and Ideal are mainly directly operated, and the increase of Xiaopeng is relatively large; in addition, bydir, Changan, Chery and other independent brands also contributed a large part of last year's increase." ”

In 2021, the network of self-owned brand car dealers increased by 2.4% year-on-year to 51.8%; the proportion of luxury brand dealer networks was the same as last year, at 13.6%; the network of joint venture brand dealers contracted, accounting for 34.6%, down 2.4% year-on-year.

It is worth noting that in the process of rapid adjustment of the structure of China's auto market, the joint venture brands are influenced by French, American, Korean and other brands, and the network change rate is relatively high. Among the 1397 dealers who will withdraw from the network in 2021, the joint venture brand dealers account for up to 57%, while the proportion of independent brands is 36%, and the luxury brands account for only 7%.

"The outlets that have withdrawn are mainly joint venture brands for the mass consumer market. We divide the joint venture brands into two groups, one is the relatively strong brand power of the North-South Volkswagen, North-South Toyota, and the other group is the Korean and French systems, including some American brands. With the rise of independent brands, some joint venture brands that are close to the price of independent brand products are facing greater pressure, and there will still be pressure to withdraw from the Chinese market in the future, and the knockout round has begun. Lang Xuehong pointed out that second-tier luxury brands, including Acura and Infiniti, have also seen more withdrawals.

However, luxury brands have performed well as a whole driven by the trend of consumption upgrading, and small and medium-sized groups and single stores of luxury brands have also become the main targets of recent channel mergers and acquisitions. In October last year, Zhongsheng Group completed the acquisition of Renfu (China) Co., Ltd., and in the same month, Yongda Automobile announced the acquisition of two BMW 4S stores and two Lexus 4S stores in Jiangsu Province for 833 million yuan.

In addition, from a geographical point of view, in 2021, the distribution of automotive channel networks still shows the characteristics of east and west. The network growth rate in most provinces and cities is positive, and the network growth rate in inland provinces, especially in the northwest provinces, is higher.

Among them, there are nearly 5,000 4S networks in the county (excluding urban areas), accounting for more than 15%. There are more than 500 county-level 4S networks in Zhejiang, Jiangsu and Shandong provinces.

"The county economy is also a new growth space for future economic growth, including new infrastructure investment will focus more on the county economy and county seats, and this area is also the direction of the extension of the dealer network in the future." Lang Xuehong pointed out, "The country is close to 2,000 counties and county-level cities, and the total GDP of these regions accounts for 40% of the total GDP of the country, while the proportion of the population is higher, accounting for more than 50%, but the layout of the automobile network is only 15%. ”

New energy vehicle channels are diversified

The rapid development of the new energy vehicle market has led to the rapid expansion of the new energy vehicle channel network, and gradually formed a network with different functions in three categories: 4S sellers, showrooms/experience centers, and after-sales service centers in the form of channels.

The "Report" shows that in 2021, the number of various outlets in the new energy vehicle channel will exceed 6,000, of which more than 5,000 are independent sales experience stores (including 4S forms). After-sales service centers share after-sales workshops with traditional fuel vehicles.

In 2021, the number of new energy supermarkets located in shopping malls/shopping malls has developed rapidly, reaching more than 2,200. Nearly 70% of the supermarkets are concentrated in 20 cities, of which more than 100 are new energy supermarkets in Shanghai, Shenzhen and Beijing.

At the same time, with the rapid development of the new energy vehicle market, manufacturers have also increased their investment in the construction of new energy channels, and have selected the common network or sub-network methods according to their own conditions. At present, luxury brands mainly adopt the grid connection method, and most of the new energy high-end sub-brands launched by independent brands adopt the method of network separation. Among the joint venture brands, the North and South Volkswagen ID series, on the one hand, sells in the original channels and networks, on the other hand, encourages agents to establish ID supermarkets in the commercial center.

However, at present, brands are constantly exploring channel changes, and the actual channel models of both new forces and traditional manufacturers have shown some ambiguity. Among the new forces, Weilai adopts a direct operation model and Xiaopeng adopts a direct operation plus agency model; traditional manufacturers start from a certain model and test more models.

"Whether it is a branch network or a common network, it will face its own challenges in the future, and the key lies in ensuring the professionalism of new energy-related services and balancing the interests of existing channel networks." Lang Xuehong said.

In addition, the "Report" shows that while the new energy sales channels are changing, the service channels of new energy vehicles are also reshaping. In the early days, most of the new energy after-sales channels represented by the new forces of car manufacturing adopted the method of self-operation of mechanical and electrical business and sheet metal spray business authorized to independent after-sales comprehensive repair plants, and with the continuous improvement of ownership, the new force brand began to lay out the direct operation of sheet metal spray centers.

Under the further improvement of the ownership of new energy vehicles, the new energy brand self-built service center, integrated sheet metal and delivery and other service functions, the original "specialized and refined" multi-format network form, partly replaced by the 4S format integrating sales and services.