The Zhitong Finance App learned that on November 13, data from the Passenger Link branch showed that on November 1-10, the passenger car market retailed 0.567 million vehicles, up 29% from the same period in November last year, down 3% from the same period last month. Since this year, the total retail sales volume of 18.402 million vehicles has increased by 4%. From November 1 to 10, passenger car manufacturers across the country wholesale 0.667 million vehicles, an increase of 41% over the same period in November last year, and an increase of 45% over the same period last month. A total of 21.843 million vehicles have been sold since this year, an increase of 5% over the previous year.

On November 1-10, the passenger car NEV market retailed 0.31 million vehicles, up 70% from the same period in November last year, up 10% from the same period last month, and the cumulative retail sales of 8.638 million vehicles since this year, up 41% year on year; from November 1 to 10, passenger car manufacturers across the country sold 0.35 million new energy vehicles, up 78% from the same period last month, up 36% from the same period last month. Since this year, 9.629 million vehicles have been sold, up 38% year on year.

1. The national passenger car market started strongly in November 2024  

The passenger car market sold 0.057 million vehicles per day in the first week of November, up 29% from the same period in November last year, and down 3% from the same period last month.

From November 1 to 10, the passenger car market retailed 0.567 million vehicles, up 29% from the same period last November, down 3% from the same period last month; the cumulative retail sales since this year was 18.402 million vehicles, an increase of 4% over the previous year.

Encouraged by the country's end-of-life renewal and local trade-in policies, car purchase consumption has recently achieved a good situation where strong growth has been achieved. In particular, local trade-in policies subsidizing electric vehicles is 1,000 to 5,000 yuan higher than oil trucks. In many places, the subsidy gap is smaller, and the trend of equal rights for oil and electricity has been achieved with fair competition. This is a huge highlight of local policies. The national end-of-life and renewal policy is extremely strong in caring for new energy vehicles. After local policies are balanced, it will help improve the pressure on dealers to survive.

Recently, the domestic stock market has achieved a strong rise, driven by favorable policies. Referring to the 2014-2016 results, when the stock market suddenly soars, more capital will enter the stock market, and it is difficult for the car market to achieve a rapid rise at the same time. Recently, the domestic A-share market has continued to rise steadily for a long time, so the continued strengthening of the car market is also an inevitable trend.

2. In November 2024, the sales volume of passenger car manufacturers across the country gradually strengthened

In the first week of November, passenger car manufacturers sold an average of 0.067 million vehicles per day, an increase of 41% over the same period in November last year, and a 45% increase over the same period last month.

From November 1 to 10, passenger car manufacturers across the country sold 0.667 million vehicles, an increase of 41% over the same period in November last year, and an increase of 45% over the same period last month; since this year, 21.843 million vehicles have been sold, an increase of 5% over the previous year.

The manufacturer's sales trend continued to be strong in November. The replacement policy is beginning to relay the scrap subsidy policy and explode the market; the end-of-life policy is more beneficial to new energy, and the effects will gradually decline later. However, the stimulus effect of the replacement policy is greater than that of scrapping, and the stimulating effect of fuel vehicles is remarkable.

Inventory removal in the passenger car industry has been extremely strong this year. As joint ventures continue to remove inventory, compounded by recent overall production prudence, overall domestic passenger car manufacturer and channel inventories fell by 0.94 million vehicles from January to October this year (down only 0.11 million vehicles in the same period last year). Dealers' operations were extremely difficult, and inventory removal became mainstream. However, November should be a seasonal inventory increase period in the passenger car market. Since demand for car purchases is strong from winter to before the Spring Festival, this time has been a period of intense inventory increases throughout the year. Therefore, there was a reasonable demand to increase inventory in November, and dealers purchased goods at a faster pace in November, which shows an improvement in channel confidence.

3. Average passenger car prices declined somewhat in October 2024

According to Passenger Link data, the cumulative retail sales volume from January to October this year was 17.84 million vehicles, an increase of 3% over the previous year. Among them, as the national end-of-life renewal and trade-in promotion fee policies continued to gain strength, the national retail sales of passenger cars in the narrow sense of the word were 2.26 million vehicles in October, up 11% year on year and 7% month on month, and market vitality gradually recovered. According to Passenger Link data, the average sales price in the car market continued to rise until the first half of 2024, reaching 0.186 million yuan in the first half of 2024. Facilitated by national scrapping and trade-in policy subsidies, the share of entry-level model sales has increased. The upward trend in the price segment sales structure of the national passenger car market has changed in recent years. The average price of passenger cars nationwide fell from 0.186 million/vehicle in the first half of 2024 to 0.168 million/vehicle in October, and the market in all price segments strengthened across the board. The popularity of private cars in China is still at a low level in the world, with 1,000 people owning 200 passenger cars, and there is huge room for future development to promote consumption.

In recent years, the share of models over 0.3 million yuan in all segments has continued to rise, but this year it began to decline. The share of retail sales of 0.3-0.4 million yuan models was 10% in 2023 and stabilized in 2024, of which it fell to 7.9% in October. Models over 0.4 million yuan accounted for 5% of domestic retail sales in 2023, compared to 3% in October this year. Independent high-end breakthroughs reflect a clear trend in high-end development brought about by the growth of new energy sources for passenger cars, but the decline in traditional luxury cars is severe.

4. Domestic demand for passenger cars in China has huge potential to grow

Our recent export performance has been excellent, and at the same time, we need to see the huge potential of domestic demand. According to the China International Statistical Yearbook data published by the National Bureau of Statistics, in 2021, the number of passenger cars per thousand people in China was only 183. The level of ownership is relatively low in the world, far lower than countries with economies such as Brazil, Mexico, Kazakhstan, and Russia. According to the China International Statistical Yearbook data published by the National Bureau of Statistics, China has only 54 passenger cars per kilometer of road, which is far below the level of road vehicles in Europe, Japan, and South Korea.

US Republican presidential candidate Trump recently announced his victory in the 2024 presidential election. During the election campaign, Trump's policy propositions were quite aggressive. Many of his opinions drew the world's deep attention, and what has the greatest potential for domestic consumption is the popularization of private car consumption.

There is still huge room for improvement in our car purchase consumption, which was previously suppressed by real estate and high housing prices. Currently, the contribution of private consumption to China's economic growth is very low, and the popularization of private cars requires more tax and fiscal policy support to promote consumption.

Highlights of structural growth of new energy vehicles in May and October

The model power segment trend in October this year contrasted quite a bit with last year. In October of this year, the A-class narrow-sense plug-in hybrid showed outstanding performance. There was a situation where growth was maintained month-on-month, and economical electric vehicles also showed strong growth. Meanwhile, the trend of high-end electric vehicles and range extensions slowed markedly in October. Extended range electric vehicles were stronger month-on-month in October last year.

The core market for new energy vehicles in 2023 will still be the second car for families, and demand for second vehicles will weaken in 2024. The dominant position in 2024 is obvious. The core market for pure electric vehicles is strong competition in the B-class electric vehicle market.

In the early stages, the economical pure electric vehicle market remained the main force. The A0 class was sluggish in the first half of this year, and the preferential vehicle purchase tax standard was raised to 200 kilometers in July, temporarily curbing A00 class growth. The recent incremental effect of a 5,000 yuan higher subsidy for the purchase of new energy for scrap compared to fuel vehicles is obvious. The overall economic performance of major independent manufacturers will be strong in the next few months.

The downturn in pure electric power is mainly a downturn in core market segments, but recent scrapping updates are driving the growth of entry-level electric vehicles and plug-in hybrids. A0 grade pure electric power fell back from the first main force in October last year to the second-tier main sales volume, but the trend improved in August-October.

However, the trend of A-class pure electric vehicles was weak in October. The A-class electric vehicle market is still in demand for online car-hailing and rental. Recently, after the online rental market was saturated, A-class pure electric vehicles have declined sharply. Recently, the mixed trend of private demand has picked up relatively, and exports are also driving mixed growth.