Since the beginning of this year, the national auto market has been affected by the inertia of the market downturn last year. Production and sales have continued to show signs of weakness, and the price of vehicles has continued to decline. It is expected that the gap between production and sales in the later period will further widen, and inventory may continue to rise. Comprehensive information shows that the auto market in the second half of this year will experience a slow recovery process, but overall there will still be a slightly looser market structure of supply relationships. Affected by this, the downward trend of auto prices will be more clear.
It is worth noting that since the beginning of this year, imported cars have fallen more and less, and the scenery has disappeared. As imported cars continued to sell well in the second half of last year, luxury cars at the end of the year were queuing up for a while, and individual models had irrational spending of several tens of thousands of yuan, making dealers already earn enough money and profits. This year, the auto market as a whole is still in a weak position. Consumers are blindly following the trend of weakness. Imported car price reduction promotions have become an inevitable means of stimulating demand and seizing market share. In the first five months of this year, the average price of imported automobiles fell by 3.02% compared with the same period of last year, and the prices of high-grade imported cars and imported off-road vehicles decreased by 4.49% and 1.50% respectively compared with the same period of last year. In general, under the influence of supply and demand, cost changes, and seasonal price cuts, car prices will continue to fall as production capacity gradually releases and demand slows.
The key reasons that affect the trend of car prices are as follows:
First of all, the increase in production capacity that exceeds demand growth will have a detrimental effect on car prices. From January to April of this year, the production and sales of passenger cars were 5,074,100 and 5,049,100 respectively, with output up 4.0% year-on-year, and sales volume up 1.9% year-on-year. The difference between production and sales (output minus sales) went from negative to positive, from two years ago - 29794 vehicles and -76066 vehicles were converted to 24,972 vehicles, an increase of 24,100 vehicles from the end of March. In addition, the inventory of the auto market reached a record high of 757,400 units, and inventory accounted for 46.63% of sales in the month. From the statistical data, it can be clearly seen that the market is already in short supply and needs to be converted to oversupply, and a large number of inventory vehicles need to be digested. In the market environment with declining sales volume and rising inventories, many manufacturers have not slowed capacity expansion from the build-in-build capacity plans announced by 36 joint ventures and auto makers. Shanghai Volkswagen, FAW-Volkswagen, Shanghai GM, Beijing Hyundai, BYD, Chery, Brilliance, and Geely Automobile are expected to have production capacity of 1 million vehicles in 2012, and nearly half of the 36 companies have production capacity exceeding 500,000 vehicles. Most of the remaining enterprises still have plans to increase production and expand production. A large number of new production capacity will be concentrated on the market in the second half of the year, and the contradiction between supply and demand will further intensify, which will put a large downward pressure on car prices.
Second, factors such as rising oil prices and rising car-raising costs also indirectly affect demand growth. From the current perspective, under the influence of many factors such as the uncertain situation in Iran, the mild recovery of the world economy, and the continued downward trend in the dollar exchange rate, international oil prices are likely to remain high or continue to rise after a short-term oscillation. There is a possibility of continued upward growth. In addition, the high parking, insurance, and car repair costs, as well as individual cities such as Beijing and Shanghai, continued to implement limited-line purchase policies this year, which have slowed or postponed consumer car purchase programs to some extent. In addition, the automotive market in China's second and third-tier cities has witnessed rapid development in recent years. At present, the number of 1,000-person vehicles in second-tier and third-tier cities is only 50, and the automotive market has great potential for development. However, as the level of consumption in second- and third-tier cities is still far behind that of large- and medium-tier cities, it is sensitive to changes in car prices, and the demand for vehicle prices is relatively elastic. Therefore, low prices and price reductions are still effective means for expanding sales in the later period.
Also, the seasonal price cuts cannot be ignored. In the fourth quarter, due to the end of the year, consumer confidence and expected price reduction mentality are improving day by day. Manufacturers are under pressure from inventory pressure and withdrawal of funds. Some models should adopt official price adjustments, and even do not rule out the use of pressure on a few manufacturers. Behavior, which led to increased dealers' operating risks, forced them to continue to increase price reduction promotion on the basis of price cuts by manufacturers, with a view to alleviating financial pressure and stimulating demand release.
Judging from the overall situation, in the second half of the year, the auto market will gradually assume a buyer's market pattern that is slightly greater than the demand. The price reduction factor will play a leading role, especially in the mid-level cars and the following subdivided models with fierce competition and tight price competition. Local price war may be staged at any time. . However, under the support of factors such as rising production costs, there is little possibility that prices will fall sharply too quickly. A steady decline will be the main trend of the automobile market in the second half of the year.
It is worth noting that since the beginning of this year, imported cars have fallen more and less, and the scenery has disappeared. As imported cars continued to sell well in the second half of last year, luxury cars at the end of the year were queuing up for a while, and individual models had irrational spending of several tens of thousands of yuan, making dealers already earn enough money and profits. This year, the auto market as a whole is still in a weak position. Consumers are blindly following the trend of weakness. Imported car price reduction promotions have become an inevitable means of stimulating demand and seizing market share. In the first five months of this year, the average price of imported automobiles fell by 3.02% compared with the same period of last year, and the prices of high-grade imported cars and imported off-road vehicles decreased by 4.49% and 1.50% respectively compared with the same period of last year. In general, under the influence of supply and demand, cost changes, and seasonal price cuts, car prices will continue to fall as production capacity gradually releases and demand slows.
The key reasons that affect the trend of car prices are as follows:
First of all, the increase in production capacity that exceeds demand growth will have a detrimental effect on car prices. From January to April of this year, the production and sales of passenger cars were 5,074,100 and 5,049,100 respectively, with output up 4.0% year-on-year, and sales volume up 1.9% year-on-year. The difference between production and sales (output minus sales) went from negative to positive, from two years ago - 29794 vehicles and -76066 vehicles were converted to 24,972 vehicles, an increase of 24,100 vehicles from the end of March. In addition, the inventory of the auto market reached a record high of 757,400 units, and inventory accounted for 46.63% of sales in the month. From the statistical data, it can be clearly seen that the market is already in short supply and needs to be converted to oversupply, and a large number of inventory vehicles need to be digested. In the market environment with declining sales volume and rising inventories, many manufacturers have not slowed capacity expansion from the build-in-build capacity plans announced by 36 joint ventures and auto makers. Shanghai Volkswagen, FAW-Volkswagen, Shanghai GM, Beijing Hyundai, BYD, Chery, Brilliance, and Geely Automobile are expected to have production capacity of 1 million vehicles in 2012, and nearly half of the 36 companies have production capacity exceeding 500,000 vehicles. Most of the remaining enterprises still have plans to increase production and expand production. A large number of new production capacity will be concentrated on the market in the second half of the year, and the contradiction between supply and demand will further intensify, which will put a large downward pressure on car prices.
Second, factors such as rising oil prices and rising car-raising costs also indirectly affect demand growth. From the current perspective, under the influence of many factors such as the uncertain situation in Iran, the mild recovery of the world economy, and the continued downward trend in the dollar exchange rate, international oil prices are likely to remain high or continue to rise after a short-term oscillation. There is a possibility of continued upward growth. In addition, the high parking, insurance, and car repair costs, as well as individual cities such as Beijing and Shanghai, continued to implement limited-line purchase policies this year, which have slowed or postponed consumer car purchase programs to some extent. In addition, the automotive market in China's second and third-tier cities has witnessed rapid development in recent years. At present, the number of 1,000-person vehicles in second-tier and third-tier cities is only 50, and the automotive market has great potential for development. However, as the level of consumption in second- and third-tier cities is still far behind that of large- and medium-tier cities, it is sensitive to changes in car prices, and the demand for vehicle prices is relatively elastic. Therefore, low prices and price reductions are still effective means for expanding sales in the later period.
Also, the seasonal price cuts cannot be ignored. In the fourth quarter, due to the end of the year, consumer confidence and expected price reduction mentality are improving day by day. Manufacturers are under pressure from inventory pressure and withdrawal of funds. Some models should adopt official price adjustments, and even do not rule out the use of pressure on a few manufacturers. Behavior, which led to increased dealers' operating risks, forced them to continue to increase price reduction promotion on the basis of price cuts by manufacturers, with a view to alleviating financial pressure and stimulating demand release.
Judging from the overall situation, in the second half of the year, the auto market will gradually assume a buyer's market pattern that is slightly greater than the demand. The price reduction factor will play a leading role, especially in the mid-level cars and the following subdivided models with fierce competition and tight price competition. Local price war may be staged at any time. . However, under the support of factors such as rising production costs, there is little possibility that prices will fall sharply too quickly. A steady decline will be the main trend of the automobile market in the second half of the year.
Ningbo DOKEE Medical Technology Co., Ltd. , https://www.dokeemedical.com