A new round of car price wars has nothing to do with inventory
According to incomplete statistics from "Late Finance", at least 4 auto brands have completed their sales targets at the beginning of the year in 2023, and they are BYD, Geely, Li and VOYANT. But without the various forms of promotions in the last few months, even these four brands would have struggled to meet their sales targets.
According to Yicai, BYD's best-selling model Qin PLUS DM-i in December dropped to 89,800 yuan, which is a 20% discount compared with last year's starting price. Some users receive two promotional WeChat messages from the sales of new car-making forces a week, and even Ideal has a combination of "replacement subsidies, local subsidies, and winter discounts".
Joint venture brands are more heavily discounted. According to Shenwan Hongyuan, the average discount rate of the industry rose to 11.44% in November, 2.06 percentage points higher than the same period last year, of which the discount rate of joint venture brands rose from 13.01% to 18.08%, and the discount rate of independent brands rose from 2.68% to 5.8%.
Another way to fight the price is to upgrade the configuration, for example, the price range of the Zeekrypton 007 equipped with an 800V high-voltage system is 209,900 yuan to 299,900 yuan. The Zhijie S7, which Huawei and Chery have partnered on, has 800V high voltage, Huawei's chassis and intelligent driving system, and is more than 5 meters long, with a starting price of about 250,000 yuan.
China's auto sales peaked in 2017 and 2018 after declining, and the upgrading of the competitiveness of new energy products in these two years stimulated a number of car purchases, coupled with the larger-than-expected increase in purchase subsidies for new energy vehicles, further unleashing demand, driving the national auto retail sales back to the level of 20 million units for three consecutive years.
Considering the durable goods nature of automobiles, the price war cannot be stopped in the short term. But this time the bargaining has little to do with inventory.
According to the statistics of the China Automobile Dealers Association, over the years, there has been a high positive correlation between the preferential index (or price change range) of passenger cars and the inventory warning index of auto dealers, that is, the higher the inventory warning index, the greater the preferential range. However, now the inventory warning index is in the historical median range, and the preferential index has reached a high level since statistics began.
In an environment of fierce competition that is gradually moving towards the stock market, only in this way can we make ourselves qualified to continue to compete. (Lin Guangying, Gong Fangyi)