In 2013, the sales volume of automobiles in China reached 21.9841 million units, up 13.89% year on year compared with 2.72% in 2011 and 4.15% in 2012. Of all, the sales volume of passenger cars was 17.9289 million units, up 15.72% from a year earlier, and with its proportion in vehicle sales further raised to 81.55%.
In 2013, the trading volume of second-hand vehicle in China amounted to 5.2033 million units, up 8.6% year on year; the turnover of second-hand vehicle trading was RMB291.649 billion, rising 10.6% from a year earlier. Over the same period, the ratio of second-hand vehicle to new cars in sales volume was 0.24, and the sales volume of second-hand vehicle made up 19.1%, compared with 72.4% in the US, where the ratio of second-hand vehicle to new cars in sales volume stood at 2.6.
In 2013, China’s automotive distribution industry characterizes the followings:
(1) Revenue of car dealers mainly comes from the sales of new cars.
In 2013, the sales volume of new cars in China accounted for 80.9% of the total sales (including new cars and second-hand vehicle); the new car sales of dealers occupied more than 85% of their total revenue, while in America over the same period, the sales volume of new cars made up 27.6% of the total, and the new car sales of dealers accounted for 57.1% of the total revenue.
(2) Dealers have a long way to go in expanding second-hand vehicles business.
In 2013, the dealers’ revenue from second-hand vehicles accounted for less than 3% of their total revenue, and this proportion in the U.S stood at 31.3% for the same period. Therefore, contribution of second-hand vehicles to gross profit of Chinese dealers was obviously inadequate, with gross profit of Chinese dealers from second-hand vehicles in 2013 accounting for 7%; and this figure in America during the same period came to as high as 26%.
(3) With higher gross margin in automotive aftermarket, dealers speed up transformation.
In 2013, China's revenue in auto after-sales service sector accounted for a small proportion, at less than 12%, but with larger contribution to gross profit (above 45%). Many dealers has accelerated the transition towards aftermarket, these dealers including PANG DA Automobile Trade and Xianglong Borui, which has provided such service items as second-hand vehicles, finance and insurance. In particular, Zhongsheng Group is planning a nationwide establishment of 500 terminal service chains that are independent from 4S system.
In future, with slowdown in growth of automotive market and the declining before-sales profit of vehicles, carmakers and dealers will shift their focus to developing automotive aftermarket. Meanwhile, as private cars surge and car owners’ concept of “car maintenance rather than repairing” gains popularity, automotive aftermarket has shown great potential, which implies that it is beginning to step into a golden period of development.
China Automotive Distribution Industry and Automotive Aftermarket Report, 2014-2017 involves the following:
- Market overview of automotive distribution and automotive aftermarket (including development course, distribution mode, market situation and development tendency)
- Sales market of new vehicle in China (including overall market, passenger cars and market segments, commercial vehicles and market segments, price trends, etc)
- Second-hand car market in China (including market situation, distribution pattern, overall market, market segments and regional market trade, deal structure, and development outlook, etc.)
- China automotive aftermarket (including automotive supplies market, car maintenance, auto consumption credit, financing leasing, and car insurance market)
- Operation of 11 listed car dealers in China (including profile, revenue, net income, net profit margin, revenue structure, gross profit structure, gross margin, distribution network and auto sales volume, etc.)