Dahe Daily Yu video reporter Qi Yi
On April 30, the latest "China Auto Dealer Inventory Alert Index Survey" VIA (Vehicle Inventory Alert Index) released by the China Automobile Dealers Association showed that the inventory alert index of China's auto dealers in April 2024 was 59.4%, down 1 percentage point year-on-year and up 1.1 percentage points month-on-month. The inventory warning index is above the boom and wither line, and the automobile circulation industry is in a recession range.
The performance of the auto market in April was not as good as that of the previous month, and consumers' willingness to buy cars was relatively low due to factors such as the traditional off-season, the Qingming holiday and extreme weather in some areas. On the other hand, the May Day Auto Show and the release of the "Action Plan for Promoting the Trade-in of Consumer Goods" have caused consumers to wait and see, and the demand for car purchases in April has been delayed to a certain extent. According to the survey, nearly seventy percent of dealers reported that their provinces, cities, groups or stores, as well as various brands, have introduced relevant support policies to promote the development of trade-in actions. However, 43% of dealers believe that the current automotive market environment is complex and the policy implementation is expected to be mediocre, while 33% of dealers believe that it is difficult to judge its actual effectiveness.
In order to complete the sales task in the first quarter, some potential customers were digested in advance and the inventory pressure of dealers was alleviated, but the dealers' orders and transactions in April were affected to a certain extent. Due to the ongoing price war, some dealers lost money on the sale of naked cars, resulting in a shortage of cash flow and a decline in dealer profits.
From the perspective of sub-indexes, the indices of inventory, market demand, average daily sales, employees, and operating conditions decreased month-on-month in April.
In terms of regional indices, the national total index in April was 59.4%, the northern index was 52.2%, the eastern index was 62.1%, the western index was 58.1%, and the southern index was 62.3%.
From the perspective of brand type index: in April, the index of luxury, imports and independent brands increased month-on-month, while the index of joint venture brands decreased month-on-month.
Judgment on the market in May: With the arrival of the May Day holiday and the successive launch of auto shows in various places, marketing activities have been launched in various places, which will further attract consumers' attention to the auto market and their enthusiasm for car purchases. In particular, on April 26, the Ministry of Commerce and other seven ministries and commissions issued the "Implementation Rules for Car Trade-in Subsidy", and the central government's detailed rules on scrapping and renewal subsidies are clear, and consumers who are on the sidelines in the early stage are expected to begin to convert into car buyers. Dealers' expectations for May are significantly better than in April.
The recently released "Notice on Adjusting the Relevant Policies for Auto Loans" mentions that the maximum disbursement ratio of auto loans will be optimized. Dealers generally believe that this move not only lowers the threshold and cost of car purchase for consumers, but also increases the proportion of mortgage car purchases, which is conducive to the increase of dealer gross profit. The policy adjustment has further stimulated the consumption potential of the automobile market, especially the sales growth of new energy vehicles and used cars will be more significant.
The China Automobile Dealers Association suggests that the uncertainty of the automobile market will increase in the future, and dealers should rationally estimate the actual market demand according to the actual situation, and reasonably control the inventory level to prevent excessive inventory pressure and business risks.