How to stabilize the channel is a problem that must be considered when the independent auto companies expand their SUV business. Some vehicle groups require dealers to build their own brand 4S stores when they acquire the joint venture or luxury car brands in the group to support the latter's network construction. Some car companies have begun to control the channel in the county-level market with the 2S direct sales model.
On May 12th, Shanghai GM announced that it lowered the retail price of the national market for its 11 models. The maximum price reduction for a single model reached 53,900 yuan. This move adds another fire to the current price war in the car market.
The price of the five major joint-venture car companies has collectively “diving”, which has brought tremendous pressure to the independent car companies that fight the market at low prices. In the face of challenges, some independent car companies choose to follow. For example, SAIC first announced the downward adjustment of the official guide price of 29 passenger cars, but this has not become the common choice of the current independent brands.
"Our price is already very low, there is no possibility of further exploration." An autonomous auto executive who asked not to be named told 21st Century Business Reporter that in the face of current market pressure, their main cracking technique is Stabilize the channel and go to the county market to find sales.
In fact, this is not the first time that autonomous car companies have faced price cuts. In 2011, the auto market had a downturn. At that time, price reduction promotions were equally popular, but it was not the price cuts that saved the automakers, but the micro-market that broke out by the policy dividend. Four years later, when the price cuts in the auto market hit again, the life-saving trucks seized by the self-owned vehicles were SUVs.
Autonomy has no price to drop. Perhaps starting from 4 years ago, independent auto companies have no strength to fight the price war. “The price of the car has already been reduced to a minimum, and it is also sent for decoration and maintenance.” A 4S shop salesperson of a self-owned brand once told reporters that in the round of competition with the joint venture car companies, almost all of their own brand dealers are letting Make a profit for promotion. Although this method can drive sales in the short term, it also pushes the independent car companies to the "dead corner" step by step.
Taking the technical route and returning to the essence of the product is the breakthrough path chosen by many independent car companies after several price wars. This is the ultimate way to save autonomous car companies. However, in the face of weak local core components technology, it is difficult to reduce costs in the short term by integrating innovation and improving the quality of independent models. This also means that in the face of a new round of price wars, there is no price tag for independent brands.
Take the A0-class SUV Junpai D60 built by Tianjin FAW Heavy Truck as an example. Jin Xulong, director of the product development center of the company, said that in order to achieve the five-star standard of C-NCAP safety crash test, they mobilized 40 vehicles for collision test. At the same time, in the procurement of parts and components, it is preferred to cooperate with world-renowned top 500 suppliers, such as airbags for the United States TRW, seat belts for Autoliv, and seats for Toyota textiles.
Although these brand supply parts have made the safety value of Junpai D60 soar, it also makes the development and manufacture of this car costly. Although Tianjin FAW is not willing to disclose its specific figures in the R&D and supply chain, its sales staff has told reporters more than once that the current low-price pricing of the car is not profitable for them.
In fact, even with the price reduction promotion, it is difficult for independent brands to drive sales. Taking Beijing's auto market as an example, although “Official Drop” has increased market sentiment for the “May 1st” holiday that just passed, the overall transaction performance is still lower than last year.
Yan Jinghui, deputy general manager of the Beijing Asian Games Village Auto Trading Market (hereinafter referred to as: Asia) told reporters: "Multiple factors such as economic, political and industrial policies are the main reasons for the further decline of the new car market in Beijing." According to statistics from the Asian city, In early May, the preferential range of Beijing economy cars has expanded from 75.86% in the previous month to 82.14%. This figure is almost twice that of January this year, but Beijing's new car trading volume in April still fell 21.33%.
“The price reduction promotion of automakers is closely related to the slowdown in the growth of the auto market.” Huang Chunming, general manager of Tianjin FAW Auto Sales Co., Ltd. told reporters that many auto companies are currently doing production and sales planning for the second half of the year. One outstanding feature is that almost everyone will This year's domestic auto market growth rate was reduced by one to two percentage points from 7%-8% predicted at the beginning of the year.
"Under the general trend, it is very difficult to make a fuss about the price by winning the independent model that wins by price." Huang Chunming believes that the main way to suppress the decline in the current situation is to dig deep into the potential consumption power of the market and stabilize the sales with the product. Network, accumulated popularity.
Is the SUV the last position?
The SUV market, where sales are soaring, is now the only breakthrough for independent brands looking for potential spending power. According to the latest statistics of the China Automobile Association, in the first four months of this year, the cumulative sales of SUVs was 1,753,700, a year-on-year increase of 48.7%, which was 41% higher than that of passenger cars, and continued to lead the automobile market.
"An unavoidable fact is that the ultra-high-speed growth of SUVs for several months is making the car market share continue to be eroded." Autonomous auto executives told reporters that under this situation, not only their own brands, but even joint venture brands. And luxury car companies are fast on the SUV models.
Compared with the latter, the current advantages of the autonomous SUV are not only the price/performance ratio, but also a better understanding of the local market. This makes them willing to look for business opportunities in the third and fourth lines and even more remote places. This kind of effort also makes the sales of independent SUVs quite eye-catching. According to statistics, in the top ten rankings of SUV sales in the first four months of this year, the self-owned SUV model occupied six seats and became the absolute winner.
But this does not mean that autonomy can sit back and relax in the SUV field. The joint venture car companies that have suffered from the inventory have long been eyeing the huge consumption potential of the SUV and will continue to explore the product line. In addition, the SUV battle between autonomous car companies is also extremely cruel.
"Everyone's reaction to the market is almost the same, they are all in shape and price, and the quality of word of mouth is difficult to be high or low in the short term." The above-mentioned independent auto executives said that this situation makes the independent SUV have no price war to fight. Everyone can only seize the business opportunity by quickly deploying a network in a barbaric market.
However, for autonomous car companies, a fatal problem now is that many dealers have lost interest in their own brands because they have been trapped in inventory all the year round. “Everyone is reforming, the main idea is basically the same, that is, optimizing the brand structure and adjusting the investment strategy.” A person in charge of a dealer group once told reporters that at present, when dealers adjust their business structure, the first “optimized” business is independent. Brand.
For example, Guanghui Auto, the largest dealer group in China, has experienced a major expansion before its listing, but most of the expanded stores are joint venture brands. When the Sichuan Shenrong Group was acquired, it basically abandoned the The company's own brand 4S shop.
Therefore, how to stabilize the channel is a problem that must be considered when the independent auto companies expand their SUV business. Some vehicle groups require dealers to build their own brand 4S stores when they acquire the joint venture or luxury car brands in the group to support the latter's network construction. Some car companies have begun to control the channel in the county-level market with the 2S direct sales model.
However, regardless of the form, the attitude of the independent car companies to the dealers is to share and support the way to ensure the stability of the sales network system. Therefore, the current SUV market is hot for the independent car companies to adjust the product, channel strategy left a breather, but how long this breathing time, there is no definitive answer.

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