Why is it that most car companies are very anxious? The car market has seen dual growth in production and sales
According to data released by the China Association of Automobile Manufacturers, in the first half of this year, China's automobile production and sales reached 13.248 million and 13.239 million respectively, with year-on-year growth of 9.3% and 9.8%, respectively. Not only has it achieved dual growth in production and sales, but this growth rate is far higher than 5.5% of GDP during the same period.
However, behind these dazzling numbers, most car companies and dealers still find life difficult, even very uncomfortable. Many enterprise bosses can't help roast: "Now the industry is too busy. Volume products, volume technology, volume prices, volume upstream and downstream of the industrial chain, the internal volume is becoming more intense while accelerating the external volume, and they feel very anxious."
Why is there such a significant "temperature difference" between the dual growth of the automotive market and the actual feelings of enterprises? Firstly, the production and sales data of the China Association of Automobile Manufacturers (CAAM) includes commercial vehicles. In the first half of this year, the sales of commercial vehicles reached 1.971 million units, a year-on-year increase of 15.8%, with an increase of 269000 units; The sales of passenger cars reached 11.268 million units, a year-on-year increase of 8.8%, with an increase of 913000 units. This indicates that the demand for personal consumption car purchases has recovered, not as strong as the demand for production materials. Usually, "temperature difference" is perceived in comparison. Currently, most car companies mainly focus on passenger car products, so it is generally difficult to feel the rebound in market demand.
Changchun, Jilin, staff are carrying out vehicle assembly operations. Photo by Xu Chang
Secondly, in the limited increment of passenger cars, the export increment accounts for the majority, and domestic demand is still insufficient. In the first half of this year, the export of passenger cars reached 1.78 million units, a year-on-year increase of 88.4%, with an increase of 835000 units. If the export increment is deducted, the actual sales of domestic passenger cars in the first half of the year are basically the same as the same period last year. The problem is that the "frenzy" in the export market only belongs to a few companies such as SAIC, Chery, Tesla, Changan, and Geely, and most companies are indifferent.
Once again, the domestic passenger car market remained relatively stable in the first half of this year, thanks to a brutal price war. No one is willing to engage in a price war, but in order to maintain market share, they have to follow suit. In the first half of this year, almost all manufacturers participated in the price war in the automotive market, either openly reducing or secretly supplementing, ultimately leading to a significant increase in sales. Especially for joint ventures mainly focused on gasoline vehicles, sales continued to decline significantly. Therefore, it is not difficult to understand why companies feel uncomfortable.
In addition, the unprofitable growth of new energy vehicles has also made companies feel anxious. In the first half of this year, China's total production and sales of new energy vehicles reached 3.788 million and 3.747 million, with year-on-year growth of 42.4% and 44.1% respectively, and market share reached 28.3%. In theory, this growth rate is much higher than expected. However, currently only Tesla and BYD are truly profitable passenger car companies in the field of new energy. Many large car companies rely on fuel powered vehicles that do not increase profits to support the development of new energy vehicles, while pure new energy vehicle brands are still in a period of loss. The anxiety of not being able to make profits for a long time has made enterprises feel confused.
Guangzhou, Guangdong, a new energy vehicle Co., Ltd. assembly line. Photo by Deng Hua
Observing the operation of the automotive industry requires not only observing changes in industry data, but also examining the firsthand experiences of enterprises. Facing the objective existence of this "temperature difference" is not only beneficial for relevant government departments to correctly understand the overall situation of industrial operation, timely, accurately, and effectively introduce policy measures, stabilize market expectations, boost development confidence, but also for enterprises to better find a sense of direction in industry development, so as to accelerate strategic goals and market strategy adjustments according to new market changes, and solve problems and achieve high-quality development.
Looking ahead to the second half of the year, in the context of oversupply and insufficient effective demand in the automotive market, coupled with industrial transformation, price wars will not stop due to a "commitment letter". The phenomenon of "unprofitable growth" of new energy vehicles and "unprofitable growth" of fuel vehicles will still coexist. To narrow the "temperature difference", enterprises also need to adjust their sales targets and product structure, and accelerate the pace of transformation and upgrading.
It is undeniable that the total volume of the Chinese automotive market still has enormous potential, but overall it will not continue to grow at a high rate, but will show a slow and tortuous growth trend. This requires companies to be more pragmatic when setting sales targets. The reason why car companies feel the "big temperature difference" now is not only related to the accelerated transformation of the industry, but also because their own goals are too high. Sales volume is one of the most important indicators for measuring the performance of an automotive company, and it is normal for companies to value this indicator. But the setting of sales targets is based on market capacity and corporate strength. In such a fiercely competitive market, how can some companies increase their sales targets by 50% or even double? In the first half of this year, not a single car company achieved more than half of its sales targets, which is a clear indication of the problem.
At the same time, we need to accelerate the adjustment of product structure and the transformation and upgrading of enterprises. It can be expected that the trend of continuous decline in sales of gasoline vehicles and rapid increase in sales of new energy vehicles will continue. Faced with the dual turning points of China's automotive industry transformation and market changes, enterprises can only empower each other, alleviate anxiety in transformation and upgrading, narrow the "temperature difference", and walk on the path of high-quality development with solid steps by balancing the development relationship between fuel vehicles and new energy vehicles, and grasping the product deployment rhythm of the two tracks.
