The annual Jingdong 618 arrived as scheduled, and it was unreasonable that the car became a major protagonist of 618.
Similar to this year's Spring Festival Gala, Jingdong United Hunan Satellite TV, Mango TV's 618 Gala, once again sent out cars. 21 ZEEKR X artist co-branded cars were given to netizens, which once again attracted attention.
Frequently out of the circle in major nodes, Jingdong Automobile has become the topic and traffic responsibility of Jingdong, but behind this, it is the whole ecological play of Jingdong Automobile is surfacing.
The first two days of the climax of JD 618 is the home of JD Auto - 616 Car Renewal Day. On the same day, Jingdong Automobile, together with the competent authorities, industry associations, more than 40 host manufacturers, and upstream and downstream enterprises in the industrial chain, sounded the clarion call for car trade-in, announcing that 100 JD Auto gatherings will be held in 50 cities across the country in 2025 to accelerate the trade-in process.
It is foreseeable that in the future, trade-in will become another heavy layout of JD Automobile.
01 Trade-in has become a new driving force for automobile consumption
The replacement of gasoline vehicles by electric vehicles is a visible trend. Statistics show that from 2020 to 2023, the penetration rate of new energy vehicles in China soared from 5.4% to 31.6% in four years. By May this year, the domestic retail penetration rate of new energy vehicles had reached 47%, which means that one out of every two vehicles sold in the Chinese market is new energy.
In the process of new energy vehicles from small to large, from weak to strong, the role of financial subsidies cannot be ignored. According to the statistics of the Ministry of Industry and Information Technology, as of 2020, subsidies for new energy vehicles have exceeded 152 billion yuan, covering at least 3.17 million vehicles.
In the past two years, subsidies for new energy vehicles have gradually declined, and the amount has become smaller and smaller. However, the negative impact of subsidy decline on the sales of new energy vehicles is also getting lower and lower, which means that new energy vehicles have begun to enter a new stage of market drive. The so-called market-driven, that is, the purchase of new energy vehicles by users no longer relies on subsidy stimulus, but on actual demand.
At the same time, China's auto market has begun to enter the stock market in recent years. According to the forecast of the State Information Center, the replacement demand of China's auto market will account for 44% of the total demand in 2024, and it is expected to increase to about 48% by 2025. This means that half of all car sales will come from trade-ins.
In the view of the person in charge of Jingdong Automobile, "the automobile market has come to a critical point, that is, from supply-driven to demand-driven." In the next ten years, new energy vehicles will complete a 'thrilling leap', and the key to maintaining rapid growth is to gain insight into user needs. "The biggest demand of users at present is undoubtedly to trade in the old for the new, and the elimination of fuel vehicles and the purchase of electric vehicles are the bulk of them.
At the policy level, a number of favorable policies have been introduced, from the central to the local government, and the relevant subsidies for the old for the new have been implemented. From the perspective of various factors, the trade-in is relaying financial subsidies, becoming a new engine for the new energy vehicle market, and accelerating the process of "oil and electricity switching".
The relay of the old for the new has two meanings: one is to relay the financial subsidies with smaller subsidies to drive the upgrading of automobile consumption; The second is to gradually release the potential of market demand and further restore market forces.
The potential for a car trade-in future is enormous. Based on the sales of 25 million passenger cars in 2023, and the trade-in accounts for 40% of the overall demand, about 10 million passenger car sales will come from trade-in, and the trade-in policy is expected to bring trillions of yuan in new car consumption based on the average price of 175,000 new passenger cars.
02 Jingdong Automobile set up a trade-in platform
In view of the important value of trade-in, as well as JD Auto's advantages in user insight and channels, the former has naturally become a powerful tool for the latter to open up the market. An obvious manifestation is that Jingdong Motors has built a big platform for trade-in.
At the beginning of this year, JD Automobile joined forces with five major associations, including the China Consumer Goods Quality and Safety Promotion Association, the China Association of Automobile Manufacturers, and the China Automobile Dealers Association, as well as nearly 50 auto brands and second-hand car trading platforms, to establish and launch the "JD Automobile Trade-in Platform". Users can enter the basic information of the vehicle on the platform to obtain valuation quotations, multi-party price comparisons, and replacement subsidies provided by OEMs such as VOYAH, Geely, and BYD.
The platform not only aggregates the relevant parties in the industrial chain, but also becomes a big window for the exhibition and sale of car trade-in, providing hundreds of millions of users with complete information, transparent services and rich models of choices. Since the launch of the platform, it has continued to increase, and in March this year, JD.com and major brands announced an investment of 500 million yuan in subsidies to accelerate the trade-in of cars.
On June 16, at the "616 Automobile Renewal Day" press conference held by JD Automobile, JD Auto announced that it would further promote the trade-in to the offline and sinking markets. The person in charge of JD Auto's related business said that based on rich landing experience and omni-channel supply chain capabilities, JD Auto will focus on expanding the high-potential sinking market, integrating the visible and tangible car trade-in rights, using JD's brand influence, user base, and multi-format capabilities, and uniting the government, OEMs, dealers, industry associations, and cross-border brands to open up online and offline, on-site and off-site play, and accelerate the promotion of the "JD Auto Collection" activity.
Since the beginning of this year, Jingdong Automobile has held a number of car gatherings in Suqian, Jinan, Kunshan and other places in conjunction with local governments, automobile brands and other parties. On May 6, Jingdong Automobile and Jinan Municipal Bureau of Commerce jointly launched the "Jinan 2024 Car Trade-in Subsidy" officially opened the declaration, with a total of 50 million yuan in subsidy funds, and Jingdong is also the only declaration entrance for the event.
On the basis of holding 30 JD Auto Gatherings this year, JD Motors announced that it will hold 100 Auto Gatherings in 50 cities across the country in 2025 to accelerate the trade-in layout. From online to offline, from first-tier cities to fourth- and fifth-tier county markets, the coverage of JD Auto's trade-in has been further improved, and it has also given OEMs and second-hand car dealers more incremental space.
The continuous layout of JD Motors has also made OEMs see great value. At the key node of Jingdong 618, in addition to sending 21 ZEEKR cars, Xingtu Yaoguang also launched JD's 10 billion subsidies to create a new subsidy model; At the same time, the official flagship stores of the two major brands of Formula Leopard and Deep Blue Automobile have also settled in JD.com, bringing many popular models and car purchase rights; In addition, the live broadcast room of Jingdong Automobile also took out low-price rights and interests such as 5% off car insurance, many goods as low as 1% off and 1 yuan, and launched 1,000 galloping ponies starting from 26,900 on the night of June 18, as well as up to 12 installments of 0 down payment, 0 interest and other benefits.
Of course, in order to improve the efficiency and effectiveness of transactions, it is also necessary to remove the constraints that affect the trade-in of cars. At present, the main concerns of users about car trade-in are the opaque valuation information and non-standard service, which leads to high time and energy costs in the decision-making stage.
JD.com, which started with genuine licensed products, has a word-of-mouth advantage and a high degree of user trust in this regard. At the same time, JD Auto has also gradually overcome obstacles from the whole life cycle of automobile consumption such as "buying-distributing-maintaining-using-exchanging", and improved user decision-making efficiency and consumer experience.
In terms of selling used cars, users can fill in the car information online, get quotations and price comparisons online, and can also go to the store offline to inspect the car and service, and can also have the new energy experience center of JD Automobile, brand direct stores, dealers, etc. A variety of options to ensure that users are transparent, efficient and convenient in the process of selling cars, and eliminate worries.
In terms of buying new cars, JD Auto has an online OEM official flagship store, and an offline JD Auto New Energy Experience Center to meet the needs of users for selection, shopping and shopping. At the same time, more than 1,600 JD car maintenance stores and more than 40,000 tripartite cooperative stores extend user services from buying and selling cars to the field of car use and car maintenance. For users, the closed-loop experience provided by the one-stop platform is also more efficient and secure.
At present, Jingdong Automobile has formed a relatively strong trade-in label. Not long ago, the 21st Century Business Herald conducted a survey of more than 1,300 valid questionnaires, showing that more than 8 percent of consumers preferred JD.com for trade-in. Major appliances (52.61%) and electronic devices (48.62%) are the most well-known categories of trade-in services. This was followed by automobiles and tires (16.26%).
03 One-stop layout to make up for the shortcomings of the industrial chain
When many technology giants are building cars and flocking to the upstream of the automobile industry chain, JD Automobile has been providing good services in the downstream of the automobile industry chain, and its value to the automobile industry is not only a channel, but also a new infrastructure.
The so-called channel is easy to understand. Whether it is an OEM, a dealer, or an auto supplies supplier, they all need to sell goods through JD.com's channels. At present, the JD platform has gathered more than 600 million annual active users, including more than 200 million car owners and more than 10 million new energy vehicle owners. It's an avenue that anyone in the car business can't afford to ignore.
In particular, Jingdong Automobile's channels are online and offline, which can save a lot of investment for new energy vehicle brands that have just started. It is not an overnight effort for a cutting-edge auto brand to build a channel and network that covers major users across the country online and offline, and it is a matter of twice the result with half the effort to build a mature channel with JD.com. This is probably one of the important reasons why BYD, VOYAH, Dongfeng Shenlong and other brands have reached strategic cooperation with JD.com.
Secondly, JD Automobile is building new infrastructure in the downstream of automobile circulation and automobile industry chain. Horizontally, JD Auto Services cover the whole life cycle of automobile consumption, and vertically, covering the whole link of production, circulation, and consumption. The infrastructure that JD Motors is building is suitable for all parties involved in the industrial chain such as OEMs, dealers, and second-hand car dealers, and is a standardized and transparent ecosystem.
And this set of ecology is also what industry authorities are willing to see. Whether it is the trade-in of the old or the improvement of the efficiency of automobile circulation, a platform like JD Automobile needs to stand up and carry out investment and layout from the perspective of the industry. Ten years ago, in the process of home appliances going to the countryside, platforms such as Jingdong played an important role in circulation, connecting brands and consumers. The current car trades in for the new, and JD Motors also assumes such a role.
At the same time, while China's new energy vehicles are leading the world, the upstream and downstream inconsistencies that plague China's auto industry still exist. For a long time, China's auto industry has been strong in the upstream, and the upstream OEMs are far stronger than dealers in terms of technological innovation capabilities and profitability. Moreover, compared with auto retail, the development of many trillion-dollar markets such as auto insurance, aftermarket services, and second-hand car trading is quite slow, lacking standardization and scale.
In contrast, in mature foreign auto markets, the development of auto insurance, aftermarket services and other links is more standardized and balanced. In the context of the switch between oil and electricity, auto insurance, aftermarket services, second-hand car trading, etc. are all facing new issues, which need to be quickly followed on the basis of the previous weakness, which is no less difficult than changing lanes and overtaking in the field of electric vehicles.
But this is a lesson that China's auto industry must make up, only perfect car use, car maintenance, car replacement and other services, China's new energy vehicle industry is healthy and complete. And this is where the opportunity for the future of JD Motors lies.
Conclusion
With the trade-in as the starting point, JD Automobile is forming a closely biting gear operation with the new energy vehicle market, one end is the full-link, full-life cycle automobile ecology, the middle is the standard, efficient trade-in business, and the other is the continuous increase in the sales of new energy vehicles.
If you stand in the overall perspective of China's new energy vehicles, you can see the value of JD Auto more clearly. While Huawei, BYD, NIO, Xiaomi and other companies continue to provide new supply with technological innovation and product innovation, JD Automobile is meeting the new needs of the industry and users with platform innovation and service innovation. The two-way rush of supply and demand will bring more sustainable development impetus to China's auto industry.
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