What changes may take place in the auto parts industry?

Novel Coronavirus (2012) is the first black bat-swan to fly out in 2020. The automobile industry is the most obvious example. The impact of the epidemic on the automobile industry can be seen in all directions.

Sales of regression of

At present, 90% of 4S stores in China are still in the closing stage. February, which means the whole car sales throughout the country could become "the worst in history" in February, but look from the current situation, the auto industry to the offline payment almost stagnant situation is likely to continue until mid-march, for specific medicine research and clinical verification after successful completion can be improved, which, is full of unknown and variable.

In the short term, sales in the first quarter were almost certainly off a cliff. Before January 18, passenger car sales maintained a positive growth, with retail sales totaling about 1.11 million units, up about 3% and basically reaching the level of sales in February of last Year's Spring Festival, according to the Passenger Federation. However, in the first half of February this year, almost zero, the second half of the recovery is not clear, February this year national sales are estimated to have lost more than 1 million vehicles.

The decline in the first quarter has also had an impact on full-year sales. Analysts say the overall decline in the first quarter has reduced demand by at least one million vehicles, and if it fails to make up the shortfall, it could affect passenger car sales for the whole of 2020 by about 5%.

The rupture of supply chain

According to a survey by the China Association of Automobile Manufacturers of 212 parts and components companies, 16 percent of them lost between 20 million yuan and 50 million yuan in revenue as a result of the epidemic.

While the loss of revenue may be measurable, the impact of the epidemic on the entire industrial chain is incalculable, and not limited to Chinese companies. The problems in the automotive supply chain caused by delayed starts, quarantined workers and stalled logistics are spreading around the world.

At the beginning of the outbreak in late January, Bosch warned that the outbreak could affect its global supply chain and pose a risk of disruption. Hyundai Motor Co. also said production of one of its SUV models was disrupted due to a disruption in parts supplies.

Separately, Hyundai Motor announced that it was gradually suspending production in South Korea from February 4, becoming the first vehicle maker to suspend production outside China.

And that's not the worst news. Kia followed Hyundai's lead by suspending production on The 10th, depending on when China's car-parts factories would reopen. South Korea plans to streamline import logistics and customs procedures for Chinese parts and components, allowing them to be cleared 24 hours a day so they can be delivered as soon as possible.

Japan before the outbreak of the auto industry is also affected, as is known to all, widely used in Japan two big carmakers Toyota and Honda parts manufactured by China, Japan's securities analyst, said auto parts inventory, on average, about a month, the situation in China affect Japan's gross domestic product will appear after 2 months or so. Even if parts manufacturers can restart production, there will be a shortage of logistics personnel to ensure and customs clearance, and it is unclear whether they can export quickly.

As the end of the whole automobile sales link, 4S shop is the most vulnerable part in the whole link, but also the one that suffers the biggest impact.

But in an epidemic like this, maybe we can see some light, after all:

Where there is more danger, there is more opportunity.

What new changes will take place in the car market after the epidemic? The author thinks, can carry on an analysis from 4 respects.

First of all, the change of consumption consciousness, or cause the change of industry pattern.

I think Chinese people have never realized the importance of a private car more clearly than now. When public transportation is restricted and public health is threatened, a private car can not only solve the travel problem, but also help people avoid contact with others. What's more, many private cars are equipped with PM2.5 air conditioning filtration systems or more advanced air quality management systems, which can give people more psychological security. After returning to work, people will have more contact with each other, which will further increase people's demand for private cars.

However, it is worth noting that this part of the customers stimulated by the epidemic is the customer group that just needs, and this part of the group's purchase target is also a guaranteed vehicle within 100,000 yuan. In other words, this part of the group promotes the sales of low-end models. Is another level, a large number of factories and enterprises to temporarily shut down, resulting in a large number of private owners and enterprise senior management staff's expectations of future economic conditions improve and income is not optimistic, these two aspects, no matter which side, for improving type and luxury car market segment, brings with it a certain pressure, and the pattern of the automotive industry, will thus adjust and change.

Some experts expect it will take three to six months to restore normal production and operation after the outbreak, and the impact on luxury cars will continue along with industry reshuffles.

Second, the overall sales of the car market will not change much in 2020.

For this year's sales, different agencies in the industry have made different forecasts for the car market in 2020. The China Association of Automobile Manufacturers expects China's auto market to sell 25.31 million vehicles in 2020, down 2% year on year. China's passenger car market is expected to grow 1 per cent in 2020, according to the Association.

No suspense, 1 to 2 months of this year, even in the first quarter sales will fall sharply, but one thing worthy of note, is originally in the first quarter of potential is not disappear, but turned to the other three quarters of this year, this part of the car demand was originally a stock demand, from this point of view, fall in the short term, long term stabilization, basic is foreseeable.

And because the disease caused by the shortage of parts, also will be improved after the outbreak of improving, after all, has experienced many years of development, the domestic automobile industry chain is already relatively perfect, and after the outbreak, countries will be launched to encourage consumption and stimulate the economy related measures, and the auto industry as the national one of pillar industries, will undoubtedly benefit the industry.

From the above two aspects, the negative impact of the epidemic on the automobile industry is actually only temporary. In general, the annual production and sales scale of China's automobile market in 2020 will be the same as that in 2019, and even the two-year year-on-year decline can be ended.

Third, relations between carmakers and dealers will improve.

One of the positive effects of the outbreak on the car industry may be improved relations between car companies and dealers.

For a long time, the relationship between car companies' dealers has been delicate, both dependent on each other and opposing each other. Generally speaking, dealers are the reservoir of car companies' sales, and they often have to undertake the spare capacity or excessively high sales target of car companies. This to dealers "YaKu" behavior, which leads to the dealers on the operation is easy to fall into "YaKu - selling fixed - price - brand damage - selling cars - continue YaKu" negative cycle, ultimately lead to the whole car companies sales link crash, before they have dealers for car companies policy, finally cause relationship break precedent.

Dealers have become the most vulnerable part of the epidemic. Some dealers told the author that if they do not own land and have a large inventory of new cars, they may face the risk of closing down their stores if they continue in the current situation for no more than three months.

So for carmakers, keeping dealers is a priority. In this respect, the automobile manufacturer has made the unified policy pertinently.

From epidemic began to spread, many makers have announced a series of supporting policies, including adjusting sales task, policy and business operations, the lower the difficulty of target, increasing the grace period for financial support, terminal personnel safety protection subsidies developed detailed measures, to ensure that the operation of dealer network health. In addition, special action guidelines have been issued on staff and customer care, marketing, sales financing, after-sales service and other aspects of the outlets, and detailed planning and guidance have been made for dealers around the resumption of work. At the same time, targeted to arrange the network of new media interactive customer gathering online training plan, to help dealers to tide over the difficulties.

At the same time, the large-scale production reduction or even production suspension has eased the burden for many dealers with inventory pressure, which makes the relationship between the two sides become more harmonious.

Fourth, the 4S store model accelerated the transformation.

The marketing model that has already appeared before is being tried more in this epidemic. For example, some dealers have conducted WeChat video car watching, douyin live broadcast and free car delivery service.

It is also an opening for industry change. For example, according to the author, a domestic brand is negotiating with an organization to open an online 4S shop. The functions of online 4S stores, including new car sales, loans, replacement of used cars and so on, are more powerful. The ultimate goal is to better integrate the three aspects to form an online marketing platform.

Of course, the online model has yet to deliver more realistic sales results. However, with the increasing maturity of various modes such as live streaming, VR360° car viewing and online car selling, the offline sales mode dominated by 4S stores is under constant impact.

We know that Tesla, as a success story and a pioneer in the industry, has been following the model of online sales from the very beginning. Moreover, at the end of January in China, tesla also set up several WeChat groups of 100 people through its circle of friends to conduct two live broadcasts for several hours every day. The store guides or invites the old car owners to demonstrate the performance of the car, the booking method of the official website, the charging quality assurance, intelligent call and other aspects. These new model and practice, gave domestic car company beneficial hint.

Write in the last:

The Chinese nation has been plagued by disasters and indomitable since ancient times. Every time we go through difficulties, we will be strong and grow up, but we will become stronger.

For business, all the great companies in the world have gone through two world wars.

And now we have experienced the baptism of two viruses, I believe there will be a part of the enterprise to step up to a new level.

Perhaps opportunities are turning around.