Low demand, inventory explosion, official down wide auto market set off a new round of price war

Posted on 6/17/2017 9:58:27 AM

China Automobile Industry Association, the latest data show that car sales continue to decline year on year. At the same time, the market stock continued to early warning, stock early warning index for 5 consecutive months above the warning line.
Lower market conditions and inventory warnings led to increased operating pressure on automakers and distributors. With more and more manufacturers to open the "official down" model, a new round of price war has been opened and intensified.
At the same time, the China Automobile Dealers Association recently released the latest data show that the first three months of this year, the auto market early warning index of more than 60% per month in April to 59.2%, even the traditional sales season in May, inventory warning Index has also been beyond the cordon, reaching 51.8%, the stock early warning index for five consecutive months above the cordon.
China Automobile Dealers Association, said Shen Jinjun, the stock factor is always above the warning line, indicating that the downward pressure on the market is relatively large, this year's stimulus policy is reduced, the corresponding market growth may be reduced.
Industry analysis, the inventory of May is currently in a relatively high state, to June, because it is off-season, plus the end of the quarter, the dealer may be in order to assess the manufacturers into a group of vehicles, resulting in increased inventory, While the opposite direction of inventory and sales changes, will cause the stock factor to rise further, the dealer's inventory pressure will be further increased.
Price war intensified
In the case of increasing market pressure, the car market a new round of price war opened the curtain. Unlike in the past, this round of price war is from the luxury brand began.
In March this year, luxury brand car prices began to become obvious. Among them, Audi and BMW related competitive models offer even more than 100,000 yuan. In addition to the first camp, Cadillac, Land Rover, Volvo, Infiniti and other second-tier luxury car brand also embarked on the use of price cuts to increase sales of "shortcut."
Prior to this, Changan Ford official announced that since April for some models of wing tiger launched price reduction policy, the new car to adjust the guidance price of 184,400 to 270,800 yuan. Even the first four months of this year, sales volume increased by 15.01% of the FAW-Volkswagen flagship models MAGOTAN, the current cash discount in Beijing has reached 25,000 yuan, while the first four months of sales fell 7% year on year, SAIC Volkswagen Passat, The current cash discount to more than 30,000 yuan.
China Automobile Dealers Association of Industry Coordination Director Hui Yumei said that the decline in passenger volume in May on the car sales had a certain impact. In addition, the new sales management approach will be implemented on July 1 this year, consumers believe that the New Deal will lead to more influx of dealers, the overall market price will decline, the phenomenon of holding money to be more obvious.

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