On April 10, 2022, the China Automobile Dealers Association released the results of the March 2022 "Auto Dealer Inventory" survey: the comprehensive inventory coefficient of auto dealers in March was 1.75, down 5.4% month-on-month and up 13.6% year-on-year. In March, the multi-point epidemic spread widely, and the overall automobile market was cold. The decline in sales and the replenishment of warehouses at the end of the quarter have led to a significant recovery in the inventory level of dealers compared with previous years, and the inventory level is above the warning line.
In January and March, the inventory coefficient increased year-on-year and decreased month-on-month
Affected by the epidemic, many prefecture-level cities have adopted epidemic control measures in the whole region or key areas, which has disrupted the market rhythm of car companies and dealers. In a sample of 90 cities surveyed, dealers in 25 cities were suspended for several days due to epidemic prevention and control. The normal sales work of dealers cannot be carried out smoothly, resulting in a decline in sales, an increase in inventory, and a slow return of dealers' funds. The overall coldness of the industry has made less than 10% of dealers complete the task indicators for the month in March, and nearly 50% of the dealers have only completed 70% of the task indicators. Production and logistics have been affected by the epidemic, the order delivery cycle varies from 1-2 months, considering that the supply cannot return to normal in the short term, and the vehicle delivery cycle is expected to be extended. At the same time, the supply of raw materials for automobile production is insufficient, and the production cost is increasing, resulting in a general increase in the price of new energy vehicles, the price of some fuel vehicles has also been raised, coupled with the continuous increase in oil prices and other factors, consumers have insufficient confidence in car purchase, and market demand has also been affected.
In summary, the auto market in March did not have the expected sales target, less than the expected 1.6 million units, and the inventory level also climbed compared with previous years, and only slightly declined month-on-month.
Second, the inventory coefficient of high-end luxury & imports, joint ventures and independent brands decreased month-on-month
The inventory coefficient of high-end luxury & import brands was 1.50, down 1.50% month-on-month; the inventory coefficient of joint venture brands was 1.90, down 5.5% month-on-month; and the inventory coefficient of independent brands was 1.66, down 4.6% month-on-month.
In March, the inventory coefficient of auto dealers was high, mainly due to the impact of the short-term multi-point epidemic, so high-inventory brands were not announced for the time being.
Third, cautiously anticipate market demand in April 2022 to reasonably control inventory
Under the control of epidemic prevention, the Beijing Auto Show was originally scheduled to be held in April, but the local auto show activities were also shelved, and the new car plan was passively delayed, which directly affected the heat of the auto market in March. The scope of this round of the epidemic is relatively large, and it is expected that there will still be a certain impact on the market in early April. If the epidemic is controlled in mid-to-late April and the impact is basically eliminated in May, then the backlog of market demand in the short term will be released quickly and sales will gradually recover.
The China Automobile Dealers Association suggests that dealers should rationally estimate the actual market demand and reasonably control the inventory level according to the actual situation. At the same time, we must not relax the epidemic prevention and control measures and continue to implement the measures for epidemic prevention and control.
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