Hard and long-term new energy path

September 15, 2019

(Junfeng discusses information): Domestic car market sales fell 6.9% from August. New energy vehicles went down for two consecutive months, looking at the trend of the next four months.



According to published data, in August 2019, Chinas automobile sales reached 1.958 million units, down 6.9% year-on-year. Among them, the sales volume of passenger cars in August was 1.653 million, a year-on-year decrease of 7.7% and a month-on-month increase of 7.9%.


From January to August this year, the cumulative sales of automobiles in China was 16.104 million units, down 11% year-on-year. Among them, the cumulative sales of passenger cars from January to August was 13.322 million units, down 12.3% year-on-year.


China's new energy vehicle market, which we are particularly concerned about, has not gone out of the haze. After the decline in sales in July, it has not yet fallen back in August. According to the data released by the China Automobile Association, in August, China's new energy vehicles sold 85,000 vehicles, down 15.8% year-on-year; among them, new energy passenger vehicles sold 80,000 vehicles in August, down 11.4% year-on-year. The sales volume of pure electric vehicles was 63,000 units, up 1.4% year-on-year, and the sales volume of plug-in hybrid vehicles was 16,000 units, down 40.5% year-on-year.

The sales of new energy vehicles of Junfeng Motor also showed a significant downward trend.


Reason one: the impact of subsidy policy


The sales of new energy vehicles continued to decline, mainly due to the fact that in June, auto companies were rushing to over-spend their policies, and the cost of sales brought about by the subsidy retreat at the end of June increased sharply. It is difficult to quickly cope with such cost changes in all aspects of production and sales. The new energy vehicle market needs to go through a certain buffer period.


Reason 2: Intensified competition in the new energy vehicle market


China's new energy vehicle market is undergoing a policy-oriented and market-oriented transition. The state and local subsidies have rapidly degraded, and the institutional strength, brand power and quality of new energy vehicles have been tested.



In this situation, the competition in the new energy vehicle market will further intensify. At present, traditional car companies are still the main force in the new energy car market. Although the new power companies have gradually delivered, they are still difficult to compete with traditional car companies in terms of brand power and quality, and in the black technology and innovative marketing. The new force of the car is in an advantageous position. The competition between the two will be a rally. Whether the new forces of the car can shake the market position of the traditional car companies will be waiting to be seen.


In the face of downward pressure, Xiongguan Road is really like iron, and the last four months from the beginning. Junfeng Company recently held a special meeting to analyze the situation and discuss countermeasures. Jun Feng believes that the sales volume in the next four months can be expected to complete the sales target of new energy vehicles at the beginning of the year:


First, after the policy is solidified, the buffer period is over, the market enters a normal rational state, and the growing market demand will be released in the next four months;


Second, close to the winter, cities with smog and pressure, especially in the northern cities, the pressure for environmental improvement is increasing. Many cities have introduced local policies to promote the application of new energy vehicles. New energy vehicles can be used to alleviate some urban haze, which will surely result. Some just needed.


Third, each auto factory has to complete the 2019 double points index, and will take more effective promotion measures to achieve its sales targets.


Fourth, the General Office of the State Council recently issued the "Opinions on Accelerating the Development of Circulation and Promoting Commercial Consumption" to support the high-quality development of the automobile industry and encourage users to use new energy vehicles. The relevant national policies and measures will help alleviate the downward pressure on the automobile industry and play a very good role in promoting China's automobile consumption.