The latest survey by the China Automobile Dealers Association shows that in the first half of 2024, only 18.4% of dealers completed their six-month sales tasks, with the inventory alert index for Chinese automobile dealers reaching 62.3% in June, indicating that the domestic automobile market is still facing severe challenges.
According to the survey by the China Automobile Dealers Association, only 18.4% of dealers completed their six-month sales tasks in the first half of 2024. 34.8% of dealers accomplished more than 80% of their tasks, while 13.5% of dealers have yet to complete 50% of their tasks.
Financial news reports on July 2 revealed that car manufacturers and dealers set annual and quarterly sales targets, and formulate dealer business policies around these targets. If dealers meet their sales targets, manufacturers will provide rebate incentives. Based on the current sales situation, most dealers are unable to meet their tasks, resulting in a lack of various rebate subsidies.
The data disclosed by the China Automobile Dealers Association on June 30 showed that the inventory alert index for Chinese automobile dealers reached 62.3% in June, up 8.3 percentage points year-on-year and up 4.1 percentage points compared to the previous month. The index for June hit a new high for the year, indicating that the domestic automobile market demand remains weak, putting continued pressure on car dealers.
The inventory alert index for dealers uses 50% as the turning point, with anything below 50% considered reasonable. The higher the alert index, the lower the demand in the automobile market, resulting in greater inventory pressure, operational challenges, and risks. Since January 2024, the index has remained above 50%, indicating that the automobile market has been struggling.
Facing further escalation of inventory pressure in the automobile market in June, the China Automobile Dealers Association analysis attributed it to various factors such as the start of the busy agricultural season in many regions, adverse effects from hot weather and heavy rainfall in the south on customer traffic and transactions at dealerships. Additionally, dealers’ expectations for incentives like the “trade-in for new” policy and the “618” large-scale promotion events led to increased inventory, aggressive discounting, and even selling cars at a loss, yet actual sales did not meet expectations, further worsening the business situation.
Many netizens expressed that the fundamental reason for the sluggish automobile market is that people simply lack the financial means.
Netizen “Zhong Qiang Suzhou Wonos Precision 1866258” believes: “The fundamental reason for weak demand is poverty.”
“Come see the news” stated: “It’s mainly an issue of empty wallets, isn’t it?”
“coral_fu” also remarked: “Indeed, it’s about not having money, not pretending to be broke!”
Netizen “Together to Jail” had a differing opinion on the China Automobile Dealers Association’s explanation for the rise in car market inventory, stating: “Who buys cars based on the weather? The association is really humorous.”