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The inventory early warning index of Chinese car dealers in August was 52.8%.

iconSep 7, 2020 10:20

SMM Network News: close to Jinjiu Silver Ten, the inventory pressure of car dealers has been significantly reduced. According to the latest "inventory early warning Index Survey of Chinese Automobile Dealers" VIA (Vehicle Inventory Alert Index), the inventory early warning index of automobile dealers in August 2020 was 52.8%, down 9.9% from the previous month and 0.5% from the same period last year. Although the inventory early warning index is still above the rise and fall line, the overall circulation of cars has improved.

According to the sub-index, the market demand index, average daily sales index, employee index and operating condition index increased month-on-month in August, which is the direct source of the reduction of inventory pressure. From an index point of view, the inventory index dropped 6.3% month-on-month compared with July, with a marked improvement. In August, manufacturers encourage inventory digestion, but the phenomenon of dealers exchanging volume with price still exists. The increase in sales does not mean an increase in profits and profits. 4S stores still need to be on guard against operational risks.

However, the degree of improvement of each brand varies, including imported and luxury brands driven by consumer upgrading and additional purchase demand, the inventory index fell 11.5% compared with July, entering the boom range, followed by mainstream overseas brands, the index fell 10.6% to 54.7% month-on-month. Chinese brand inventory is relatively slow, down only 4.9% from July, and the August index is still high. It can be seen that the pressure on Chinese brands and their dealer system is still great.

From the perspective of regional index, in August, the national total index was 52.8%, the north index was 53.2%, the eastern index was 52.7%, the western index was 49.7%, and the southern index was 57.1%. The greatest inventory pressure in the south is due to the decline in the rate of consumers arriving at stores due to the impact of the flood season and typhoons in the south, and there is no significant change in inventory pressure compared with July.

Editor's comments:

On the whole, the economic improvement in August, coupled with policies such as going to the countryside and recycling subsidies, and the rigid demand for car purchases during the 818 car purchase Festival and the school season, have released the purchasing power of consumers, led to an increase in sales and reduced inventory pressure. Looking forward to September, due to entering the peak season of traditional consumption, coupled with factors such as the stacking of new cars and the Beijing Auto Show, the car market may continue to improve; however, it should still be noted that the impact of the epidemic on people's purchasing power and economic level still exists, coupled with the continued downward trend of the car market, it is not appropriate to be overly optimistic, and dealers still need to reasonably control the level of car inventory. (

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