Car prices have fallen into the decline channel prices will intensify

In the first half of the year, the pressure on domestic autos has skyrocketed, while the prices of Chinese autos have also been on a downward trend.

A few days ago, the National Development and Reform Commission price monitoring center announced the monitoring results of automobile prices in 36 large and medium-sized cities across the country. The results showed that the domestic auto prices in the first half of the year decreased by 1.16% over the same period of last year, among which, the largest decline was in passenger cars, and the cumulative year-on-year decline 3.26%.

Specifically, from January to June of this year, China’s auto prices have been falling for the sixth consecutive month, including a four-month decline. According to data provided by the National Development and Reform Commission price monitoring center, automobile prices fell by 0.97% year-on-year in January and decreased by 0.04% from the previous month; in February, it was down 1.47% year-on-year, down 0.36% year-on-year; in March, it was down 1.18% year-on-year; in April, it was down 1.11% year-on-year. , a month-on-month decrease of 0.15%; a year-on-year decrease of 1.03% in May and a year-on-year decrease of 0.15%; a year-on-year decrease of 1.18% in June.

Frequent price cuts at the market level have provided very good commentary on the above data. In the mid-to-high-end car segment, Guangzhou Automobile's Honda Accord’s maximum discount exceeds RMB 30,000. GAC Toyota Camry and Changan Ford’s Mazda6 have a maximum discount of RMB 40,000, which is even known as “strong in price”. Dongfeng Honda CR-V also saw a cash discount of up to 20,000 yuan. Although the profit margin of the self-owned brand models is not large, it has also been swept by price cuts. For example, FAW's Pentium B50, Guangzhou Automobile's Chuanyu, BYD's F6 and other mid-level models have reached a maximum price reduction of 20,000 yuan. For A-class vehicles such as Vision, Geely Freeship, Chery A3, and Chang'an Yuexiang, the price cut ranged from 5,000 yuan to 10,000 yuan.

In fact, the reason for the decline in car prices is not hard to find. The withdrawal of a series of encouraging policies, the chain reaction triggered by Beijing’s restriction of purchases, rising oil prices, and high inflationary pressures have caused the sales of the entire automobile industry to be hindered. In another hand, the entire vehicle companies have been trying to complete The sales targets set at the beginning of the year were actively produced, and after the phenomenon of oversupply, the decline in car prices in the first half of the year was inevitable.

It is worth noting that the trend of lower automobile prices in the second half of this year will further aggravate.

While the majority of vehicle manufacturers stated that they would not reduce production, Cheng Xiaodong, chief analyst of the automotive industry price monitoring center of the National Development and Reform Commission, said: “Now, the demand for automobiles in first-tier cities such as Beijing, Shanghai, and Guangzhou is approaching saturation. In order to increase sales volume, vehicle companies must expand into third-tier and fourth-tier cities. However, in general, these cities are not very strong in terms of spending power, and are therefore more sensitive to prices. Therefore, in order to occupy these markets, vehicle companies and distributors It is necessary to make further reductions in prices."

At the same time, according to the general laws of the Chinese auto market, the old models will generally face upgrading in the fourth quarter of the year, while vehicle companies will be forced to clear inventory and repatriate while setting aside price space for new cars to be listed next year. The pressure of funds and consumers' attitudes on holding the purchase price is bound to take the approach of selling at a reduced price, which will also lead to the car prices continuing to fall sharply.

Therefore, by the fourth quarter, the market is very likely to have a wave of large-scale price cuts. As a Dongfeng Nissan 4S shop manager said: "We will pay close attention to the trends of competitors, if they have changed, we will also adjust the margin of preference." The person in charge of a 4S shop at FAW Toyota also stated: “At present, the discount rate of some FAW Toyota models is very large, which makes it difficult for opponents to catch up. However, we are also formulating new promotional policies to cope with the price of competitors. Constantly lowering."

Based on this, some monitoring agencies and some industry experts generally believe that the Chinese auto market price will fall 8% to 10% year-on-year this year.

The process of gradual decline in the price of automobiles is also a process of gradual loss of corporate profits.

In response, Zhang Zhiyong, a senior analyst in the automotive industry, said: “The decline in car prices in the second half of this year will certainly be more dramatic than in the first half of the year. Therefore, from the whole year, the decline in profits of some auto companies is inevitable. For large companies, because of the large base, there is still room for even a decline in the amount of profits, and for those relatively weak auto companies, if they cannot achieve a certain scale of production and sales, they may face the market to eat. Therefore, based on the environment of the automotive market this year, from the next year, there will be a new wave of mergers and restructuring in the automotive industry."