After experiencing the “hardest” April in history, China‘s auto industry ushered in a significant recovery in May.
On June 10, the China Association of Automobile Manufacturers (hereinafter referred to as the China Association of Automobile Manufacturers) released the operation of China‘s automobile industry in May. Data show that in May, China‘s automobile production and sales reached 1.926 million and 1.862 million respectively, a month-on-month increase of 59.7% and 57.6% respectively.
“In May, as my country’s efficient co-ordination of epidemic prevention and control and economic and social development continued to show, the outbreak of new coronary pneumonia at multiple points in the country was effectively controlled, and the level of economic prosperity improved compared with April.” Chen Shihua, deputy secretary-general of the China Automobile Association Said, “The joint boost of central and local policies has played a significant role in driving automobile consumption. In addition, through the hard work of the automobile industry, the pace of resumption of work and production has been significantly accelerated, and the supply chain of the automobile industry chain has been gradually smoothed.”
Among them, China‘s new energy vehicle industry has grown rapidly, and the sales of new energy vehicle companies also ushered in a collective explosion in May. BYD’s monthly sales exceeded 110,000 vehicles.
Although automobile production and sales achieved a relatively large month-on-month growth in May, compared with May 2021, the above two data still fell by 5.7% and 12.6%. It can be seen that further recovery of the auto industry will take time.
New energy vehicles led the rise, and new forces rebounded collectively
According to data from the China Automobile Association, in May, the production and sales of new energy vehicles were 466,000 and 447,000 respectively, a year-on-year increase of 113.9% and 105.2% respectively.
Driven by the overall recovery of the new energy vehicle market, the market performance of major new energy vehicle companies has also recovered rapidly. Among them, the sales volume of BYD, Tesla China and GAC Aian reached 114,000, 32,000 and 21,000 respectively, with a month-on-month growth of 8%, 2027% and 105% respectively.
After the downturn in April, the mainstream new power companies in car manufacturing also ushered in a rapid recovery in May.
According to data released by various companies, in May, the sales of Xiaopeng, Ideal, Nezha and Leapmotor among the new car-making forces exceeded 10,000 units. Although Weilai’s sales in May did not exceed 10,000 units, it also achieved a month-on-month growth of 38.4%, reaching 7,024 units.
It is worth mentioning that since the end of 2021, due to the continuous rise of power battery raw materials, mainstream new energy vehicle companies have raised prices for several rounds, but whether it is the increase in prices of car companies or the disruption caused by the new crown pneumonia epidemic, it seems It has not dispelled the enthusiasm of consumers for new energy vehicles.
In this regard, Sun Shaojun, founder of the car sales service platform “Chefans”Finance car(ID: caijingqiche）Said: “At present, the transaction rate of new energy vehicles is relatively high, and even if the prices of new energy vehicles continue to rise, the terminal sales have not been affected. I think the reason is that although the company gave up the previous target users after the price increase, it won the It is a new and more powerful consumer group, so the sales of new energy vehicles can still achieve growth.”
And Cui Dongshu, Secretary General of the Passenger FederationCaijing Automobile (ID: caijingqiche)Said: “There is another factor for the higher sales of new energy vehicles, that is, the rising international oil prices, which further highlights the cost advantage of new energy vehicles.”
Although terminal demand is strong, supply chain constraints are still a problem that new energy vehicle companies need to face.
“Although the ideal auto parts supplier in the Yangtze River Delta region has gradually resumed some production, there is still a shortage of parts supply.” Shen Yanan, co-founder and president of Ideal Auto, said.Caijing Automobile (ID: caijingqiche)Said: “At present, the production of Li Auto’s Changzhou plant has not fully returned to normal, which has led to delays in the delivery of new cars for some users. Li Auto is working with suppliers to actively restore production capacity while meeting the requirements of epidemic prevention and control, and shorten the booking period of Li Li ONE. (Configuration|Inquiry) The waiting period for the user to pick up the car.”
Inventory is high, dealers step up to clear inventory
In May, major auto companies are stepping up efforts to resume work and production.SAIC is rightCaijing Automobile (ID: caijingqiche)Said: “More than 50% of the front-line production personnel were on duty in late May, and the production capacity has returned to more than 60% of the usual level. After the subsequent closed operation is over, double-shift production will be resumed soon, and the production capacity will be further improved.”
Cui Dongshu pairCaijing Automobile (ID: caijingqiche)Said: “With the new crown pneumonia epidemic under control, at present, the production of car companies in Shanghai and Changchun, Jilin has increased significantly.”
However, while the policy is stimulating the market to recover and enterprises are accelerating the resumption of work and production, the situation of high inventory is becoming more and more obvious. According to data from the China Automobile Association, at the beginning of May, the inventory of auto companies was 868,000 vehicles, and at the end of the month, it was 933,000 vehicles, a growth rate of 7.4%.
Chen Shihua said: “The inventory index of traditional fuel vehicles has been above the warning line, and the inventory has increased. Some car companies still lack spare parts, so some models cannot be delivered to dealers.”
“Because of the new crown pneumonia epidemic, our store was basically closed in May, so there are many cars in stock in the store, and there is a lot of financial pressure.” Some Dongfeng Citroen dealers commented.Caijing Automobile (ID: caijingqiche)Said: “By July, we will focus on destocking, and the dealers in this area are basically like this.”
In order to accelerate the recovery of the automobile industry, on May 31, the Ministry of Finance and the State Administration of Taxation issued the “Announcement on Reducing and Levying Purchase Tax for Some Passenger Vehicles” (hereinafter referred to as the “Announcement”), pointing out that the purchase date will be in June 2022. During the period from January 1 to December 31, the vehicle purchase tax will be halved for passenger cars with a displacement of 2.0 liters and below (9 seats and below) whose bicycle price (excluding VAT) does not exceed 300,000 yuan.
Cui Dongshu pairCaijing Automobile (ID: caijingqiche)Said: At present, dealers are really focusing on clearing inventory. The inventory status in the early stage aggravated the financial difficulties of the dealers, and the problem of relief is more prominent. The terminal retail sales in early June were obviously strengthened under the promotion of policies, and it is expected that the inventory of dealers will be transformed into a strong retail increase in June.