“In the first half of the year, the Chinese auto market has a good situation with sales reaching 6.988 million units, which represents a year-on-year increase of 17.69%. Moreover, sales from January to June are increasing month by month, so we have adjusted the sales target of 10.2 million vehicles estimated at the beginning of the year to 11 million.†This was the news release of the China Association of Automobile Manufacturers on July 9th. Dong Yang, executive vice president and secretary general of the China Association of Automobile Manufacturers, announced to the media.
According to statistics, in the first half of the year, new car sales in the United States dropped by 35.1% year-on-year, Japanese car sales fell by 21.5% year-on-year, and Russia’s car sales dropped by 49%. In comparison, with the release of mid-year auto production and sales data, China climbed the top spot in global auto sales in the first half of 2009. At the same time, many people in and outside the industry are also concerned: Will the Chinese auto market continue its rapid growth in the second half? Recently, this reporter visited several industry experts and asked them to analyze and predict the reasons for the prosperous Chinese auto market in the first half of the year and the direction of the second half of the year.
In the midst of the global financial crisis, the Chinese automobile market has risen in the first half of the year.
“The country has introduced such a policy of bailout so intensively in half a year. This has never been the case in the past. According to my many years of experience, it shows that the government is paying more and more attention to the development of the automobile industry.†Dadong Automobile Group Co., Ltd. Pang Qinghua, chairman and general manager, told reporters.
Pang Qinghua believes that although the international financial crisis has affected the consumer confidence of car buyers to a certain extent, the policy of halving the purchase tax for 1.6 liters and below of emission models has been immediately seen, activating the small-displacement car market, and many consumers taking a wait-and-see attitude. Afterwards, the automobile industry policy adjustment plan and the introduction of the 4 trillion yuan investment policy greatly boosted the confidence of consumers; the car-to-country and trade-in replacement policy allowed the auto companies to find new market growth points and provided them with a new market growth point. The “cold†second- and third-tier car markets entered the market and the rigid demand for local automobile consumption was initially released.
When interviewing the sales managers of some auto companies, the reporter also obtained the same answer: In the first half of the year, the prosperity index of China's automobile market far exceeded market expectations, thanks to the country’s successive policies of expanding automobile consumption.
Rigid demand supports strong consumer spending
“The superposition effect of favorable policies is certainly a booster for the recovery of the auto market, but we cannot ignore the most basic point. That is the rigid demand for auto consumption in China is very large. At present, the secondary and tertiary markets in China and the vast rural consumer market It has not yet been fully activated and has huge potential for consumption,†Jia Xinguang, a senior expert in the domestic automotive industry, told reporters.
According to a survey conducted by the National Information Center on the national car buyers in 2008 [Review Picture Forum], the number of new cars purchased last year accounted for 83.1%, and 8.7% of new or replacement cars were purchased. Consumers purchasing second or third cars were added. Accounted for 8.2%. "Obviously, the biggest feature of China's auto industry is that the car penetration rate is still relatively low. Our 1,000-strong population is 20.5. Many families are buying cars for the first time. At present, China's auto industry has entered this year. The second period of rapid growth, said Xu Changming, director of the Resource Development Department of the National Information Center, said at the July 7th Beijing Beichen Asian Games Village Automotive Market Information Conference.
Dong Yang believes that the fundamental reason why the Chinese auto market is so strong is that the fundamentals of the overall economic situation in China have not changed, and the fundamentals of the development of the Chinese auto industry have not changed. “The per capita car ownership is still relatively low, the income level of residents is gradually increasing, and the country’s macro economy has maintained a relatively rapid development. Under the effect of superposition of favorable policies, it is inevitable that the Chinese automobile industry will recover first.â€
There are two bottlenecks in the auto market in the second half of the year
Although the industry has been overjoyed with the growth of the Chinese automotive market, the first half of the year, “increasing production but not increasing revenue†has plagued auto companies and distributors. According to data released by the listed companies in the automotive industry, in the first quarter, SAIC, Dongfeng, Chery, Guangzhou Automobile showed a negative growth of 38% to 54% year-on-year, and FAW, Southern Auto, Hafei, CNHTC and Yutong posted negative growth of up to 65%. ~95%; Brilliance, Jianghuai, Jinlong, and Shaanxi Auto turned losses from their profits in the same period last year.
However, as the auto market moves higher, Dong Yang said: “The economic benefits of the auto industry have improved since May. From January to March this year, the profit decreased by 48% year-on-year, from January to April to 28%, from January to May. The decrease was reduced to 9%, and it is expected that the industry's profits will increase in June.â€
Jia Xinguang said that the so-called “decrease in the economic efficiency of enterprises is gradually narrowing†is mainly due to the decline in the PPI (producer price index) and the reduction in enterprise costs. He explained: "Although the first half of the introduction of small-displacement vehicle purchase tax halved and the "car to the countryside" policy has promoted a substantial increase in the sales of beneficiary models, but due to small-displacement cars and micro-passenger profit margin itself is small Even if the sales volume is large, the profit is very low."
Regarding whether or not the economic benefits of the enterprise will be further improved in the second half of the year, Pang Qinghua said: “Although the industry’s economic benefits have gradually improved since May, this phenomenon of “increasing production without increasing income†may further expand in the fourth quarter of this year. The performance of brand enterprises is particularly obvious.†He analyzed that due to the pessimistic expectation of the auto market at the end of last year, companies conservatively formulated this year's sales plan, and the market demand is very large, resulting in less than supply of automotive market in the first half of this year, and the shortage of supply on the market. Even in the second half of the year, manufacturers will increase their sales targets this year according to market demand and expand production capacity, which may lead to a situation where supply exceeds demand. In the fourth quarter, manufacturers will increase sales promotion in order to reduce inventory. As a result, the profit margin has gradually narrowed, and so there has been a slogan of “increasing production but not increasing revenueâ€.
Another bottleneck in the development of the auto market in the first half of this year is the continuing downturn in the commercial vehicle market. According to statistics from China Automotive Industry Association, in the first half of this year, commercial vehicles produced and sold 1.571 million and 1.655 million vehicles, with output up 1.64% year-on-year and sales volume down 0.52%. Jia Xinguang believes that as far as the current situation is concerned, due to the improvement of the macro economy, the further development of the secondary and tertiary markets, and the gradual improvement of the automobile replacement policy to the countryside, the commercial vehicle market has shown a warming trend. “With the introduction of the trade-in regulations, the commercial vehicle market demand will be further released in the second half of the year.†Pang Qinghua said that the adjustment of light-car purchases in the second half of the automobile-to-country policy will stimulate sales of light trucks; the country’s investment will reach 4 trillion yuan. The policy is expected to have a certain impact on the commercial vehicle market in the second half of the year and will further stimulate the demand for commercial vehicles such as heavy trucks, construction vehicles, and large and medium-sized passenger vehicles.
Companies have raised their annual sales targets
Although there were two increases in oil prices in June, which was a bearish negative for car sales in the second half of the year, Dong Yang analyzed that rising oil prices and the implementation of the three national standards will not change the general good of the auto market in the second half of the year. situation.
"I believe that the situation in the automotive market in the second half of the year will be more gratifying and the growth rate may reach 20%." Pang Qinghua told reporters decisively. He believes that the first half of the car sales boom is not a short-term blowout. With the development and occupation of second- and third-tier markets and the vast rural consumer market, the rigid demand for first-time car buyers will be further released.
With passenger vehicle sales reaching a record high for several consecutive months, some OEMs have successively increased their sales targets for the beginning of the year. Most of the joint-venture automakers have raised their prices by more than 10%, while the automakers of their own brands have increased by about 20%.
The relevant person in charge of Changan Automobile told reporters that Changan Automobile has increased its original annual target of 500,000 vehicles to 600,000 vehicles, an increase of 20%, and an increase of nearly 70% compared with 350,000 vehicles last year. It is reported that Changan has started the expansion of the Hebei base in July. This is the second time Changan Automobile has expanded its production capacity within one month after the new Chongqing Fishbone Base was established. The goal is to achieve a production and sales target of 2 million vehicles in 2012.
As one of the fastest-increasing car sales companies in the first half of the year, Beijing Hyundai has increased its sales plan from 360,000 units to 400,000 units at the beginning of this year, up 11.1%, while the construction of the second phase of Beijing Hyundai Second Plant will be completed during the year. The company's production capacity will be increased from 500,000 to 600,000.
According to the person in charge of Dongfeng Yueda Kia Corporation, the company’s sales growth in the first half of the year was as high as 41%. Although the company has not raised its annual sales target, it is expected to achieve an annual sales target of 190,000 units and even exceed 200,000 vehicles.
In the context of the fact that the tide of the financial crisis has not fully receded, the move to increase sales targets shows the confidence of auto manufacturers in the overall automotive market this year. However, some individual companies have expressed concern. Ren Yong, deputy general manager of Dongfeng Nissan Passenger Vehicles, revealed that although Dongfeng Nissan’s sales volume increased by 41.3% year-on-year in the first half of the year, it has completed more than 58% of the full-year target, and this year is expected to achieve an annual sales target of 388,000 units in advance, but due to the There are still some uncertainties in the auto market for half a year, so the annual sales target will not be raised.
Consolidate next year's auto market needs consumer credit support
"Actually, I am not worried about the market in the second half of this year because the effect of policies on car-to-country and trade-in replacement for some commercial vehicle products has not been fully released in the first half of the year and will be further manifested in the second half of the year. Instead, what makes me more worried is that Next year's Chinese auto market.†Jia Xinguang told reporters frankly, “Often, auto companies develop a new car cycle for at least two to three years. If the purchase tax reduction policy is implemented for only one year, it will have a considerable boost to the company's operating performance. In addition, it is not known whether the subsidy policy for the autonomy of the countryside will continue, and even if the subsidy policy for auto subsidy for rural areas continues to be implemented next year, the subsidy will certainly not be as strong as this year, which may undermine the purchasing enthusiasm of price-sensitive rural consumers."
Jia Xinguang said that the stimulating effect of frequent favorable policies on the auto market is short-term. From a long-term point of view, auto finance may become the main source of profits for auto services. Auto consumption credit will play an economic lever in the development of auto industry. effect. “The proportion of cars purchased through credit in China is only about 10%, which is far lower than that of foreign developed countries, which is 70%. At present, China’s huge demand for car purchases cannot be met due to lack of credit support. In this case, Car consumer credit can convert the potential car consumption desire into actual consumer demand, he said.
According to Xu Changming, director of the Information Resources Development Department of the National Information Center, in order to ensure a new growth point for the domestic auto market next year, relevant state agencies are studying the introduction of new incentive policies for auto consumption credit.
Pang Qinghua, the founder of the “Gudong Model,†a feature model for the domestic auto finance industry, said that it is a common phenomenon in the automotive industry that dealers have difficulties in financing and the manufacturer’s liquidity is insufficient. “The state should give policy support in the areas of corporate listing, mergers and acquisitions, leasing, financing, etc. to ensure that the Chinese auto industry gets a more healthy and rapid development,†Pang Qinghua said.
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