share_log

年末“百米冲刺”大比拼!各大车企价格战再掀高潮

Year-end “100 meter sprint” competition! The price war between major car companies has reached another climax

Zhitong Finance ·  12/01/2023 07:50

As the end of the year approaches, it is the final moment for major car companies to sprint to their annual goals, and the “price war” in the car market has also been pushed to a new peak.

The Zhitong Finance app learned that since the peak season for gold, nine, and silver, BYD (01211) was the first to launch a year-end price reduction promotion in early November. Subsequently, various brands such as Zero Sports Auto (09863), GAC Aian, Linker, Geely Automobile (00175), and Euler under Great Wall Motor (601633.SH) all introduced car purchase subsidies and limited-time discounts to follow up. However, as the end of the year approaches, it is the final moment for major car companies to sprint to their goals for the whole year, and the “price war” in the car market has also been pushed to a new peak. According to analysis from industry insiders, in the long run, intense price competition may trigger price restructuring within the industry, thereby affecting the overall competitive trend of the NEV market. The introduction of various local policies is expected to effectively stimulate consumer demand in the short term and help the automobile industry achieve sales targets.

According to information, since then, BYD's “first shot” of price cuts has triggered follow-ups from car companies such as Zero Sports, Lynk & Co., and Ideal (02015). A sales person at a BYD 4S store in Shanghai said that at present, the all-electric model discount is even stronger. For example, the long battery life version of the Han EV can be discounted by 18,000 yuan, the plug-in hybrid version can be discounted by 8,000 yuan, the sedan Qin EV can be discounted by 10,000 yuan, and the plug-in version can be discounted by 8,000 yuan.

Feifan Auto sales staff said that the Feifan R7 only needs 2,000 yuan to get a luxury option package worth 25,000 yuan. This car previously sold for over 270,000 yuan, but now, not to mention the drastic price reduction after the launch of the new model, many features have been added and upgraded, and many people have placed orders recently.

The SAIC Volkswagen ID series has achieved good market sales through a series of price reduction measures. Starting in November, the SAIC Volkswagen ID series has also introduced a “limited-time transaction price.” Among them, the ID.3 model was discounted by 37,000 to 43,000 yuan, the ID.4 X was discounted by 33,000 to 42,000 yuan, and the ID.6X model was directly discounted by 50,000 yuan.

However, compared to the wave of price cuts set off by BYD, Tesla (TSLA.US) has begun a pattern of continuous price increases. Among them, on November 9, the price of the Model 3 long-life renewal version increased by 1,500 yuan, and the price of the Model Y long-life version increased by 2,500 yuan; on November 14, the price of the Model Y rear-wheel drive version increased by 1,500 yuan; on November 21, the price of the Model Y long-life version increased by 2,000 yuan; on November 28, the price of the Model Y long-life version increased by 2,000 yuan, and the adjusted price was 306,400 yuan.

In addition, major car companies are also stepping up the launch of new products, enriching their product matrices, and helping sales sprint by the end of the year while also paving the way for next year's market performance. For example, on November 30, Changan Ford's new-generation Mondeo family further improved its product matrix and launched a high-horsepower E-hybrid model with a price of 189,800 to 219,800 yuan; the Geely Xingyue L Zhiqing and Starrui L Zhiqing will go on sale on December 3, further consolidating Geely's fuel vehicle market share.

At the same time, in order to firmly hold on to the “backbone” that supports consumption, various regions have once again introduced relevant policies to promote automobile consumption. On December 1, Jiangxi Province will begin issuing “2023 Jiangxi Provincial Auto Vouchers” totaling 19.53 million yuan; Dalian will issue “2023 Dalian Winter Vouchers” totaling 20 million yuan from November 28 to December 31; and Nanjing will also issue a second round of new car purchase subsidies for passenger cars starting November 28 (inclusive), up to 4,000 yuan/vehicle for fuel vehicles and 5,000 yuan/vehicle for new energy vehicles. Furthermore, according to incomplete statistics, in addition to the regions mentioned above, regions such as Sichuan, Suzhou, Changsha, Guangdong, Gansu, Qingdao, Xinjiang, and Hefei are all contributing to the final sprint of automobile consumption with “real money”.

According to an analysis from industry insiders, the purpose of car companies and local governments increasing preferential policies is to stimulate year-end sales and promote consumption of new energy vehicles. Such industry promotion activities may, on the one hand, bring about an increase in sales volume, and on the other hand, increase competitive pressure on the market and may affect the profit margins of car companies. In the long run, intense price competition may trigger price restructuring within the industry, thereby affecting the overall competitive trend of the NEV market. The introduction of various local policies is expected to effectively stimulate consumer demand in the short term and help the automobile industry achieve sales targets.

As far as consumers are concerned, due to the intensification of the “price war” in the car market this year, consumers' wait-and-see attitude of holding coins also continues to rise. Many consumers worry that “they have bought at a loss,” and the mentality that “wait and there will be a lower price” is widespread. However, in response to consumers' concerns, Geely Galaxy brand sales staff said that it is determined now that if there is a more favorable policy next month, delivery can be made according to the new price, so there is no need to worry about “losing money” at all.

However, for car companies, according to the latest data released by the China Automobile Dealers Association, the comprehensive inventory coefficient for car dealers in October was 1.70, up 12.6% from the previous month, and the inventory level was above the warning line. The China Automobile Dealers Association said that under heavy inventory pressure, dealers are speeding up the pace of sales, digesting inventory, and impacting the annual target.

Xiao Zhengsan, vice president and secretary general of the China Automobile Dealers Association, recently stated that since major manufacturers have begun a “100-meter sprint” before the end of the year, the automobile distribution sector has entered a period of deep adjustment, and dealers' inventories are high, and they are forced to exchange price for volume. This kind of increase in sales volume is at the cost of abandoning benefits or profits.

Furthermore, Zhang Xiuyang, Secretary General of the China Passenger Vehicle Industry Alliance, said that on the one hand, competition and promotion among car companies will provide stable support for the car market at the end of the year, helping car market sales hit a new high. However, on the other hand, in the impulse phase, as competitive pressure intensifies, more car companies will join the promotion and price reduction ranks in the future, further squeezing the profit margins of car companies.

It is worth noting that with the ongoing “price war” and the support of subsidy policies in various regions, the automobile market has shown a rapid growth trend this year. In particular, new energy vehicles have repeatedly reached new highs. Data show that from January to October of this year, China's automobile production and sales volume were 24.016 million units and 23.967 million units, respectively, up 8% and 9.1% year-on-year respectively. Among them, the production and sales volume of new energy vehicles was 7.352 million units and 7.28 million units respectively, up 33.9% and 37.8% year-on-year respectively, with a market share of 30.4%.

Regarding the performance of the domestic auto market in 2023, Xu Haidong, deputy chief engineer of the China Automobile Association, said that the performance of the automobile industry this year exceeded expectations, and the total sales volume is expected to be close to 30 million vehicles, reaching a record high. In terms of new energy vehicles, the China Automobile Association previously predicted that sales of new energy vehicles may increase 30% year over year to 9 million units.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
    Write a comment