When the editorial department was discussing what is the most profound phenomenon in the automobile circle in the past six months, many colleagues mentioned the price war.
If the price war is compared to a knife, who should this knife hurt first? The answer may be a car dealer.
Don’t rush to refute whether this conclusion is correct or not.
Recently, a series of phenomena in the industry are gradually answering this question.
BBA completely withdrew from the price war, and I am afraid that the luxury car dream of more than a hundred thousand will be broken.
Some joint venture brands have followed suit, the preferential prices of car terminals began to be adjusted back, and the prices of new cars that had been down for so long began to rise.
Industry analysts believe that although many consumers hate this kind of behavior, but BBA dealers, really can not move.
Further ahead is Guanghui Motor, a listed dealer group with the largest total sales of passenger cars and the second largest in revenue, whose trading was suspended after 20 consecutive trading days of less than 1 yuan per share and delisted without a cap, with a market capitalization of only 6.
466 billion yuan, which has lost nearly 100 billion yuan since its peak.
Facts have proved that in the environment of industry volume and deteriorating competition, capital is no longer optimistic about the model of car dealers.
While Sinfeng Group, a well-known car dealer in Yancheng, exploded, including the thunderstorm of Guangdong Yongao Group at the beginning of the year, causing more than 100 4S stores to fall into operational difficulties, the boss lost contact, and many consumers paid but could not lift their cars.
it has aroused the attention of public opinion to the field of car dealers.
A number of hot events all point to the fact that if the price war goes on like this, the dealers’ jobs will be almost gone! In fact, both the industry and automobile manufacturers understand that as a middleman selling cars, many brands want to remove the business of “making a price difference”, but many new forces have initially shifted from a direct mode to a dealer model, which has proved that the ecological “existence is reasonable” attribute of dealers.
They are not only the most effective sales platform for automobile manufacturers to spread the influence of their own brands and products and face users directly in different regions and regional markets, but also a buffer zone for automobile manufacturers to return funds and stabilize their sales system.
it is also a barrier to face the market and resist the turbulence and impact of the industry.
It’s just that in the process of car manufacturers pursuing sales and market share and constantly provoking or following up a price war, do dealers still want to protect this barrier? The opinions of the main engine factory, dealers and consumers are not unified.
Oh, it’s too hard! Live! If it goes on like this, the dealer will collapse and the loss of the brand will outweigh the gain.
” After receiving the news that the BMW brand was going to untie the dealers, Tan Zhenchang breathed a sigh of relief and told the Automobile Commune that this was definitely the right choice at the moment.
For this sales director who has been working in the luxury car dealer system for nearly a decade, Tan Zhen knows very well that dealers and manufacturers are grasshoppers in the same boat.
Since BMW announced its withdrawal from the price war, several traditional luxury brands and several joint venture car companies have followed suit to adjust dealers’ business policies and reduce dealers’ inventory index and target assessment.
Some dealers said that even if the mainframe factory does not reduce the burden on the dealers, they are prepared to give up the annual task and do not want the rebate, because the rebate is negligible in front of the loss.
Many people think that this is a helpless move by these brands in the face of fierce competition in the market, but Tan Zhen believes that this can be called pushing the boat along the river.
After all, the inventory index of luxury brands reached a high of 66.
4% in June. 16.4 percentage points higher than the inventory decline line, the pressure is rare.
“it has already entered the traditional off-season, no matter how to fight the price war to boost sales is limited, it would be better to take advantage of the opportunity to close, dealers also need to catch their breath.
” Tan Zhen said that although as a dealer– downstream Party B of the manufacturer– does not expect brand A to consider for the dealer, at least it shows that many manufacturers have realized that the difficulty of the dealer is more than imagined.
For many car brands, especially those with history, they still have to rely on dealers.
, “Hey.
” When the “Automobile Commune” threw the topic of the living conditions of the dealers in the first half of the year to Yu Ming, his long sigh almost showed the experience and situation of the dealers in the past six months incisively and vividly.
On the other side of the phone, he has just finished the sales business in the store and is ready to go home.
It is already 10:00 at night, which is almost the norm of his work in recent months.
In fact, as the general distributor of independent head car companies in eastern China, Yu Ming may feel more clearly than the outside world, “sales and profits are declining, we, as middlemen, are very passive.
” Yu Ming said that the biggest problem may be inventory.
“as soon as there is more inventory, it will take up funds if it cannot be sold, and when the capital chain is tight, you will have to rush to sell vehicles or send back funds to the second net.
the longer you wait, the greater the loss.
” On the one hand is the task assessment of the factory, on the one hand is the cruel competition in the market, on the other hand is the weakening of consumer demand, dealers basically do not have the initiative and the right to speak.
If dealers in eastern China can also get some respite in areas where the economy is relatively developed and car consumption is relatively less cool, then in the inland Sichuan and Chongqing regions, the competition has become even more brutal.
Anyway, it has been losing money all the time.
Not long ago, the group was going to close its shop.
” Dai Ke, an insider at a Volkswagen dealer in a city in Sichuan and Chongqing, told the Automobile Commune that they had not made a profit for two years and had been living on group blood transfusions with poor sales and few customers.
“had it not been for the popularity of the Volkswagen brand in the hearts of consumers here, it might have been closed a long time ago.
” Daike sighed and said that the harvest for the whole year depends on the months at the end of the year.
Indeed, in the fifth-tier cities in the mainland, more consumers buy cars around the Spring Festival, and they are more inclined to have harvests and balances for full settlement throughout the year, so the off-season in the middle of the year is the hardest day.
As the Volkswagen brand weakens in its own attack, the sales pressure is on each sales consultant.
I used to get a monthly salary of 10-20 thousand at the end of the year, but now I get a basic salary of 1-2 thousand, sometimes even upside down.
” Speaking of the state of the store, Daike said that sales consultants do not have the passion to sell cars, the market and the company put a lot of pressure.
“A lot of cars are overdue if they can’t sell them back.
Long-aged cars account for more than 50%.
The overdue interest is shared among the general manager, sales manager, and sales consultant.
Now the sellers used to sell three or five cars a month.
As a result, once overdue interest is involved, this month will be for nothing.
” , “malignant.
The cycle is unsolved for the time being.
” Daike said helplessly.
There is no hope, so I have to say goodbye.
” During a chat with a general manager of the 4S store of the Southern Group, the Automobile Commune learned that he had left the automobile circulation industry, which had been deeply cultivated for more than a decade, and started his own business.
“although there is reluctance to give up, but also helpless, I personally think that now has passed the best era of dealers.
” In fact, some of the above performances are not just individual cases, but the data from some industries are sufficient to illustrate the living conditions faced by dealers.
The results of several head dealer groups show that while the company’s revenue has generally increased slightly, the decline in net profit is astonishing.
For example, the net profit of Zhongsheng Group fell by more than 20% last year, and the net profit of Yongda Group fell by more than 60% compared with the same period last year.
Meidong Automobile’s net profit fell by more than 70%.
According to the data released by the China Automobile Circulation Congress on the living conditions of dealers in 2023, the proportion of national dealer profits fell from 55% in 2022 to 44% in 2023, and the figure for the first half of this year will only be lower than 44%.
Of course, there are some detailed data, for example, more than 77% of the dealers have the price of the main selling model upside down, only one of the five main selling models in a store can make a profit from the price difference, and the new car sales include a negative gross profit margin as a whole.
including derivative gross profit margin, the overall cost rate of automobile 4S stores has reached 17.
51%, and operating costs have increased by more than 3 percentage points compared with the previous year.
Hey, who brought down the dealer? “now customers’ expectations of the price decline are too high, which is the core factor leading to the decline in transactions today.
” Chen Lu, head of an independent head dealer in Sichuan and Chongqing, told the Automobile Commune that in the past, it was impossible for independent brands to have terminal promotions of 30,000 to 40,000 yuan, and few of them exceeded 20,000 yuan.
now, no matter from the terminal, from the social media, from the overall public opinion environment and pressure, are not conducive to the survival of dealers.
Indeed, under the attack of the price war, consumers have their own expectations and psychological prices for automotive products.
On the one hand, car companies represented by BYD have opened the price anchors of 998 and 798, creating a false impression that mainstream autonomous cars should be sold at this price.
On the other hand, the ultra-low price screen brushing on the Internet and social media platforms, which is not true, has interfered with the normal car sales order, and low-price drainage measures can indeed form effective sales leads and retain investment.
but it also makes many consumers lose their basic understanding of the original price of cars, thinking that they can buy Mercedes-Benz BMW in 150000 and Geely Great Wall in 50, 000 yuan, which is taken for granted.
Once the price exceeds this expectation, the trading volume will drop significantly.
Chen Lu believes that the establishment of this expectation has a great impact on automobile consumption, automobile brand and end consumption, and that once it is established, it is more often irreversible.
Just like after BMW announced that it would give up the price war, it triggered negative public opinion from the perspective of car owners, no one wants to miss the opportunity to drive BBA for more than 100,000 yuan.
Now that BMW withdraws from the price war, consumers will naturally be questioned and dissatisfied with the BMW brand.
What automakers need is sales, and now they need more offline contacts, so channel capacity has become an important indicator of sales capacity.
But the more channels you open, the less profit dealers will make from selling cars.
after all, the cake is only so big, and if there are more people, it will naturally get less.
” Yu Ming said that since the price war began, the situation of each company has been different, and the more cars approved by brands with high sales pressure on dealers, and the more chaotic the terminal price will be when the market is not as expected.
Of course, the mainframe factory is well aware of its relationship with the dealer, so it will not let the dealer collapse, so the overall business policy will be better than before, but also because the market environment and conditions are changeable, the adjustment of business policy has become more frequent.
In the past, it was adjusted once a month, and it is relatively stable, and now some even change one unit a week, or some temporary remedial measures to deal with market challenges.
“the more phased and temporary policies, it is not conducive to the long-term operation of the market, it is also difficult for us to guess the next actions of manufacturers, relatively speaking, the pace will be more cautious.
” Chen Lu believes that in the face of mainframe factories, dealers are a vulnerable group, and manufacturers can sell cars at a loss of several hundred million yuan, but the vast majority of dealers are small and medium-sized enterprises.
Although the capital flow is very high, it is easy to make dealers lose three or four million yuan, and many small and medium-sized dealers’ capital chains will soon go bankrupt.
Feedback: the scores of car dealers’ satisfaction with the mainframe factory have also declined over the years.
When the market was good in 2016, when dealers made money, the score of satisfaction could reach more than 70 points, but this score had fallen to only 56 points in 2023, a record low.
The relationship between mainframe factories and dealers has also deteriorated due to changes in the market environment and pattern.
“establish a fair, transparent, simple and efficient dealer withdrawal mechanism, and call on regulatory authorities to pay close attention to the problem of dealer withdrawal.”.At the same time, automobile mainframe factories mostly take a negative attitude towards dealers withdrawing from the net.
there is no standard and standardized handling mechanism in the aspects of rebate cash, settlement of current payments, disposal of inventory vehicles and after-sales spare parts, and protection of customers’ rights and interests, and the withdrawal process is complex and procrastinating.
In the face of the increasingly prominent contradiction of the dealer model, the automobile mainframe factory is also exploringSeeking new dealer models, such as direct sales, which has been praised by new forces before, now more car companies are using new energy as the driving force to combine direct sales in the new era with traditional distribution models.
On the one hand, vehicles adopt an order-based system to eliminate the squeeze on funds from inventory, and manufacturers ‘endorsements also dispel consumers’ concerns about dealers running away.
on the other hand, dealers make profits from delivery and services and focus on the long-term.
Although they will not get high profits from selling cars like bulk cars, they can operate safely in a volatile market environment and flow smoothly.
As for after-sales service, Touhu and Tmall are also penetrating into the traditional 4S store field.
Not long ago, the original parts of all Dongfeng Nissan models under Dongfeng Nanfang Group were directly supplied to Touhu to maintain vehicles, and the original parts of FAW-Volkswagen Engine Factory were registered on the Touhu car maintenance platform and other actions can also be seen that the main engine factory is looking forward to using new models to activate the traditional 4S store model and competition and expand diversified service systems.
(Note: At the request of the interviewees, Tan Zhen, Yu Ming, Dai Ke, and Chen Lu are all pseudonyms), return to the home page of First Electric Network>.
