Following the launch of large car subsidies in Hubei and Jilin, Longquanyi District of Chengdu, Sichuan Province launched a plan of "maximum subsidy of 150,000 yuan for bicycles", and SAIC Volkswagen put up a poster of "subsidizing 3.7 billion yuan", adding a fire to the original state of price reduction and chaos among more than 30 brands.
Many consumers have asked, how long will this wave of price war last? Is now a good time to get your hands on a new car?
To answer this question, it is important to understand the reasons for this "price war". In addition to the 30% penetration rate of new energy and the continuous decline in demand for joint venture fuel vehicles, the reasons for this large-scale price reduction are also important factors for enterprises to clean up inventory for the replacement of China VI emission standard models.
Considering these reasons, Shenwan Hongyuan Securities issued a report that the oil vehicle price war will end around May at the earliest, and under pessimistic circumstances, it will not be later than the end of June.
Friends who need to buy a car or change a car, while waiting and seeing, can seize this rare window period and take advantage of the opportunity to meet a vehicle with the right price.
National VI B, forcing car companies to clear inventory?
Does this wave of large-scale price reductions for fuel vehicles have much to do with the full implementation of the National VI B standard on July 1?
What is the horror of China VI B? In a word, far beyond Euro Six.
Taking light vehicles as an example, in addition to tightening the emission limits of CO, NOx, PM, NMHC and THC, the China VIA standard also adds requirements for N2O and PN particle emissions.
In terms of test standards, the China VI standard has added an actual driving emission test to test the exhaust emissions of vehicles under three working conditions: urban areas, suburbs and highways.
Although mainstream car companies have carried out technical reserves in accordance with China VIB stage early in technology, due to the relatively complex measurement scenarios than laboratories, real road conditions testing puts forward higher requirements for parts manufacturers and OEMs, and some waist companies and even some models of tail companies are still stuck in China VI A stage due to cost and other considerations.
In addition, after the official implementation of China VIA A, some car companies used particle traps to meet emission standards, resulting in problems with vehicle quality, a surge in complaint rates, and a decline in sales of some car brands.
In the three years of the epidemic, car sales have declined compared with before, generating a large amount of inventory, and as the July 1 period approaches, many car companies are only taking advantage of local subsidies to clear a wave of over-aged inventory cars of the National VIA standard.
The price reduction is just a by-product
Although it is difficult to calculate how many cars are in stock, it can be determined that there are not as many as 6 million on the Internet, but it is expected to be at least hundreds of thousands.
According to the Shenwan Hongyuan Securities report, as long as there are brands that need to be cleared, the price war will continue. The core contradiction is the mismatch between demand that has not yet been fully released and a steady stream of production capacity. Coupled with the pressure of clearing some models of manufacturers and dealers, the price war in the first half of this year will greatly disrupt the sales rhythm and profit release rhythm of the industrial chain.
In June 2019, on the eve of the switch from China V to China VI, the retail sales of passenger cars were 2.09 million units, a year-on-year increase of 40%, while the retail sales in July and August were -17% and -18% year-on-year, which were significantly affected by the switch to the national standard.
However, the brokerage believes that the time dimension of the impact of this national standard switch will not be too long, and the degree of impact will be significantly smaller than the switch from China V to China VIA in 2019.
However, industry analysts said that the national standard switch has a greater impact on the price. This is mainly because with the increase in the penetration rate of new energy vehicles, the intensification of industry competition, car companies are facing greater pressure, coupled with high inventory levels, car companies have more motivation to fight price wars to participate in market competition.
Is the car of China VI A still fragrant?
According to media reports, more than 1,000 cars were sold within 3 days of the news of the subsidy reduction in a 4S store in Wuhan, and the online consultation time was limited to 2 minutes, and some versions of Citroen C6 have long been sold out, and even the show car has to be "protected".
Some dealers said that they were late, out of stock, and there were more than 100 orders ahead, and it would definitely not be too late to complete the procedures before March 31.
"There is no product that cannot be sold, there is no price that cannot be sold", according to the subsidy strength of C6, even if it is a national VI A emission standard, it will have a certain impact on the retention rate in the future, and it is worth trying.
For some joint venture car companies, the preferential treatment is difficult to call attractive, such as the 3.7 billion yuan subsidy announced by SAIC Volkswagen on the evening of March 16, the Huian limited time discount of 50,000 yuan, the 2023 model of the Touran, the new Touron X, and the 2023 model of Weiran discount of 35,000 yuan; and the Passat discount of 10,000-25,000 yuan. Volkswagen ID 6X and ID 4X are discounted by 30,000 yuan, and ID3 is discounted by 20,000 yuan. At the dealership, Huiang's discount is as high as 80,000 yuan, and the ID6 discount is more than 60,000 yuan.
For a long time, joint venture brands have had a high brand premium, and if this "price war" can make the pricing of joint venture car companies more reasonable, it will definitely be better for us consumers. And if you just pull up the flag to make tiger skins, in the name of "price war subsidies" to respond to the reality of marketing, to fish in troubled waters, consumers will not agree.
If this is the case, consumers would rather wait and buy a China VI B standard car, which is more cost-effective for a few more years.
Are you interested in buying a car in the near future?