In January 2017, auto dealer inventory exceeded warning

"China Automobile dealers Inventory Warning Index Survey" issued by China Automobile Dealers Association VIA (Vehicle Inventory a lert Index showed that the inventory warning index in January 2017 was 61.5%, up 18.6 percentage points from the previous month. The inventory warning index is above the warning line.


From the sub-index situation: inventory index and personnel index rose month-on-month; The market demand index, the average daily sales index, and the operating conditions index declined month-on-month, of which the market demand index and the average daily sales index fell sharply month-on-month, which was due to the market overdraft effect in December in January. In January, the policy of halving the purchase tax began to be implemented, and the Spring Festival holiday was approaching, with fewer working days, car sales declined compared with December, and dealer inventory pressure increased.
Changes in the main sub-indices are as follows:
In January, the total market demand index was 23.0%, down 51.6 percentage points from the previous month, and the market demand index fell sharply. The percentage of dealers who saw total demand as "growing" fell to 1.4% from 69.1% the previous month; Those who saw aggregate demand as "about flat" fell to 16.1 per cent from 19.9 per cent the previous month. The proportion of people who saw total demand as "declining" rose to 82.5% from 11.0% the previous month.
In January, the inventory index was 56.6%, up 3.6 percentage points from the previous month. Those who saw inventories as "growing" rose to 42.7% from 20.6% the previous month; The proportion "basically unchanged" decreased from 46.3% to 40.6%; The proportion saying it was "down" rose from 18.8 per cent to 33.1 per cent.
In January, the average daily sales index was 23.6%, down 46.6 percentage points from the previous month. The percentage of dealers who said sales were "up" fell to 4.2 percent from 62.5 percent the previous month. The proportion saying sales were "basically flat" rose to 11.9 per cent from 25.7 per cent the previous month. The proportion saying sales were "down" rose to 83.9 per cent from 11.8 per cent the previous month.
In January, the operating conditions index was 49.5%, down 5.6 percentage points from the previous month. The percentage of dealers who said business conditions were "bad" rose to 27.3% from 5.9% the previous month. The proportion describing business conditions as "fair" rose to 64.3 per cent from 62.5 per cent the previous month. Those who said business conditions were "good" fell to 8.4 per cent from 31.6 per cent the previous month.
In February, due to the impact of the Spring Festival holiday, market demand is reduced, coupled with fewer working days in February, affecting sales, and dealer inventory pressure is expected to increase.
Therefore, the China Automobile Circulation Association suggests that dealers should still rationally estimate the actual market demand according to the actual situation, and reasonably control the inventory level to prevent the inventory pressure from being too large, leading to business risks.
It is understood that the object of this month's dealer inventory survey is mainly the top 100 dealer groups in China's automobile circulation industry. It covers more than 1,000 4S stores in most provinces of the country, and has a wide range of brand coverage, covering 55 imported, joint venture and independent auto brands that are mainly mass-produced and sold in the domestic market.