On April 10, 2024, the China Automobile Dealers Association released the survey results of "Auto Dealer Inventory" in March 2024: the comprehensive inventory coefficient of auto dealers in March was 1.56, down 10.3% month-on-month and 12.4% year-on-year.
1. The inventory coefficient in March decreased year-on-year and month-on-month
After the holiday, major car companies set off a price reduction boom, and successively launched various forms of car purchase discounts such as direct price reduction, replacement subsidies, and insurance subsidies. The first half of March was affected by the Spring Festival effect, and the sales performance of dealers was slightly flat. However, in the second half of the month, dealers sprinted to the sales target in the first quarter, with the help of favorable factors such as the spring auto show and the launch of new cars, which effectively stimulated the vitality of the consumer market and achieved rapid growth in terminal sales. Due to the large price fluctuations in the auto market and the high expectations of consumers for the trade-in subsidy policy that is expected to be introduced in the future, some consumers have a strong wait-and-see mood, so the sales volume in March improved significantly compared with the previous month, but still did not reach the expected level.
It is estimated that the terminal sales of passenger cars in March will be about 1.6 million units, and the total inventory of dealers is estimated to be about 2.5 million units. With the gradual clarity of the annual goals and business policies of each manufacturer, dealers will enter the replenishment cycle in the second quarter.
Second, the inventory coefficient of high-end luxury and imported, joint ventures and independent brands declined
The inventory coefficient of high-end luxury & imported brands was 1.23, down 21.7% month-on-month, the inventory coefficient of joint venture brands was 1.90, down 7.8% month-on-month, and the inventory coefficient of self-owned brands was 1.49, down 8.0% month-on-month.
3. The brand with the highest inventory depth in March
According to the survey, 15 brands had inventory factors of more than 2 months in March. Among them, the three brands with the highest inventory depth are: SAIC-GM Chevrolet, Besturn, and Chery.
Fourth, cautiously anticipate the market demand in April 2024 and reasonably control the inventory
In April, the weather became warmer, auto shows were opened, and new cars were launched one after another, which played a certain role in stimulating the auto market. However, in some areas, the busy agricultural season, the customs and holidays of the Qingming Festival, the increase in consumer travel activities, and the expectation of trade-in support policies, have delayed the demand for car purchases to a certain extent. In summary, the customer flow, orders and sales volume of dealer stores will be affected to a certain extent, and the driving force of car purchase demand in April will be insufficient. With the May Day holiday approaching and the effect of the Beijing Auto Show, it is expected that the enthusiasm of automobile consumption will increase in May.
The China Automobile Dealers Association suggests that dealers should rationally estimate the actual market demand and reasonably control the inventory level according to the actual situation, so as to prevent excessive inventory pressure and business risks.
Attached: Instructions for Automobile Dealer Inventory Survey
As early as March 2010, the China Automobile Dealers Association proposed the construction of an "inventory early warning system", and since July 2010, it has been conducting regular inventory surveys of auto dealers. Through the purchase, sale and inventory survey of automobile dealers, the inventory status of each brand of automobiles and the comprehensive inventory coefficient of the industry (inventory coefficient = ending inventory / current sales volume) are calculated, reflecting the current inventory depth of the automobile brands dealered by automobile dealers, guiding manufacturers to reasonably arrange production and reduce business risks.
The purpose of the auto dealer inventory survey: First, to grasp the pulse of the market. Through the investigation of the inventory status of various brand automobile dealers across the country, we can grasp the overall situation of the industry in a timely manner and predict the future market trend. By understanding the changes in dealer inventory, it provides accurate information for relevant departments to formulate regulatory measures. Third, monitor operational risk. Timely reflect the fluctuations of production and sales in the automobile market, reasonably arrange production plans for manufacturers, and provide reference for dealers to formulate marketing strategies and control business risks.
According to the common practice of the international industry, the inventory coefficient is between 0.8~1.2, reflecting that the inventory is in a reasonable range, the inventory coefficient is > 1.5, reflecting that the inventory has reached the alert level and needs attention, and the inventory coefficient is > 2.5, reflecting that the inventory is too high, and the operating pressure and risk are very large.
This month's dealer inventory survey is mainly for the top 100 dealer groups in China's automobile dealership industry of the year. It covers more than 1,000 4S stores in most provinces of the country, and has a wide range of brand coverage, and has increased to 55 automobile brands on the basis of the original domestic market main mass production and sales of automobile brands.