Peak of car sales will surely break out!

　　According to SOHU Sui Hui’s blog, in the middle of May has already passed, although in April the production and sales are not only lower than a month ago but also lower than the predicted levels, meanwhile, the inventory is said to be 500,000 units or more than one million according to different channel statistics. Since the gap is so wide the administration departments for industry and commerce has to make rectification in order to ensure a correct understanding of the facts. For the dealer inventory, some reports mentioned the level of 1:1 while others reported to reach 1:3, the difference is also too large. However, no matter what is the actual number, the truth is the inventories did increase. Therefore, what does matter is the meaning and influences of this phenomenon.

　　Recently the author has done some market research, read some information and searched a number of reports through the Internet as well as participated in many forums and seminars, in which some questions have been raised. Based on this, the author has made some analysis and market forecasts, some of which are cautiously optimistic and some are quite optimistic while others pessimistic. Generally speaking, the diversity is also very wide. Taking a variety of domestic macroscopic dynamic states into consideration, the author suddenly realizes the accuracy of the previous cautiously optimistic forecast about the future auto market. Consequently, the author is more inclined that the peak will break again in domestic car market. Of course, since this is only a statement of a school, support and criticism will be both welcomed.

　　Impacts of policies in the automotive market

　　It has been reported by Media that the relevant departments will forbid the sales of vehicles that fail to match the state Ⅳstandards till July next year. As a result, on one hand, car manufacturers and dealer will undoubtedly make some adjustments accordingly; on the other hand, hot sales and a certain shortage in some areas will resurge like the early stage of the transition period from state Ⅲstandards to Ⅳstandards this year.

　　It has been reported by Media that the “cash for clunker” subsidies is about to end at the end of May, which arose a great impact immediately. At the beginning of this year, the subsidy policy has been adjusted twice by relevant departments. All partials have been prepared to suit this indicated trend of promoting the policy greatly. How suddenly the subsidy policy cropped up to be ended? How incredible! In fact, the subsidy policy did play a great role in promoting the auto market. So is it really necessary to end it so fast? According to public opinion, a new round of private purchase will be formed before the end of May. If so, is there still any need to worry about the inventories?

　　Since macroeconomic policy always makes assets shrink, the rising stock market and real estate will push a new round of consumption in the auto market. However, at the present tightening real estate and stock market, the rich will certainly find new ways to gain profits. Besides, the cost of a car is just a piece of cake for these persons. Therefore, to buy a second car, third car or change a new one becomes an excellent choice. In this case, the car sales will also be promoted.

　　According to the Media reports, relevant departments have already begun to address the reform of government cars as well as carry out some measures and standards. The long-standing problem is extremely complicate with its complex social context and conditions. During the process of resolving it, lower-level authorities will also have their own ways in dealing with policies from higher-level authorities. Although from long-term perspective, the market of middle-class and high-class cars will be weakened. However, it will never happen in the near term. Various government departments are now speeding up updating their cars, some of which even under the cover of supporting self-owned brands. Therefore, the cars can be sold out at very preferential prices. Besides, considering the future subsidies, some government department has already begun to choose new cars, which will definitely launch a new round of consumption in the middle-class car market.

　　Impacts of various social media

　　According to media reports, the date from Beijing Municipal Bureau of Statistics shows currently in Beijing every thirty-six families in one hundred have a car and the ownership is 228 units per thousand persons, which is close to the middle level of the international metropolis. Presently, Beijing has nearly 4.3 million vehicles. In the year of 2009, the new car sales in Beijing were 700,000 units. According to currently forecast of relevant departments, this year new car sales will reach 800,000 units. It is possible for the car ownership of Beijing to reach 5 million before the end of this year. Although the driving restrictions have been carried out, 30% of municipal government cars suspended every day and staggered working hours is adopted simultaneously, traffic congestion remains. In April new car sales in Beijing reached 65,428 units (up 10% compared with March). With the arrival of summer, the enthusiasm to purchase cars is growing.

　　At the beginning of this year, there has been hot debate within the industry that Guangzhou will place restrictions on the ownership and driving behaviors. For some unknown reasons, no final conclusion has been made. But its effect is so obvious that the general consumers in Guangzhou are rushing to purchasing cars in order to own one before the restrictions carried out. Consequently, in Guangzhou is there still any need to worry about the inventories?

　　Chengdu is planning to limit the total number of vehicles. Following the Shanghai and Beijing, Chengdu will become the third city to carry out this kind of restriction. March 26, Chengdu Transportation Committee released the announcement of hearings about controlling the vehicle in the central districts and then held public hearings successively, which has influenced the auto market ever since. Starting from early April, Chengdu auto market has emerged scare buying. Interestingly, the hot sales in Chengdu auto market is arouse by the speculations about restrictions. The popularity will continue so long as the conclusion does not come out. As so, in Guangzhou is there still any need to worry about the inventories?

　　Recently when participating in forums or the automotive industry-related activities in cities such as Qinghai, Kunming, Xi’an and Hainan, the author can obviously feel the serious traffic jams, which has already driven the general public to become more and more resentful. Speculations about driving restrictions in these cities and other big and middle cities will be aroused sooner or later, which can certainly lead to hot sales again in the auto market.

　　There has been two pieces of opinion from expert about the restrictions on vehicles and driving behaviors. One is raised by an expert of Beijing University of Technology at the meeting of expert forum about easing congestion. The expert thought the purchase of a second car should be restricted just as the house purchase. It should be said that such view has been carefully considered. It would actually be one of the ways to solve traffic congestion, but not necessarily the best way and the effects will be hard to predict. However, this kind of opinion is growing continually. The most practical effect is the consumers who are still looking on from the sidelines can no longer wait and speed up purchases. Therefore, the inventory in Beijing will shrink quickly.

　　According to media reports in May 5, a deputy minister of Department of Housing and Construction published an article to contribute ideas for easing Beijing traffic jams. Apart from raising parking fees in central districts, the deputy minister suggested to research if traffic congestion fee can be charged. Although sounds reasonable, this idea is actual lack of maneuverability in such a special city like Beijing. To charge traffic congestion fee within the city can affect only a small number of low-income owners rather than government departments or the rich. This little trick means nothing to the rich. Since the rich don’t care about this small mount of travel costs while the fees of government cars will be paid by the taxpayers, finally only the owners with ordinary incomes will limit their driving to provide a relatively smooth travel environment for the rich and the government cars, which is just like raising living costs within the city to force low-income people to transfer out of the city. Besides, there are still a series of more complex elements. But one thing worth noting is that if this official’s recommendation is adopted, the majority of people living beyond the city will form new impetus of the explosive sales growth in car market.

　　Questions about many automotive market forecasting

　　In 2009 promoted a series of policies, China suddenly became the world’s largest market in terms of both production and sales. The auto industry and manufacturers are largely inspired that most of the 2010 sales targets have been raised. Some even predicted the domestic auto market will maintain a rapid growth period of 10 to 20 years. There is no reason not to believe that the domestic auto market will not improve due to their clearly analysis, stressed arguments and uniform conclusion.

　　At the beginning of this year, the industry forecasted the production and sales will reach 15 million units. After April, impacted by related date during the first four months, the targets have been promoted to 1700-1800 units. We can recall the rising passion of purchasing cars in the second half of 2009. Such craziness just made the total sales of last year 13.6 million. How can the target of 1700-1800 units this year be achieved surely if such panic buying does not occur this year? The author believes government departments, industry sector, forecasting department and manufacturers must have their reckoning as well as their prepared measures to drive the market.

　　Currently, the goals has been promoting continuously in domestic auto market. No pessimistic market forecasts have broken out as well. Therefore, it is reasonable to believe the auto production and sales will be necessarily excellent. Besides, since more reports and forecasts are saying China will continue to maintain the world’s NO. One in regard to auto production and marketing in 2010 and coming years, we have no reason not to believe!

　　Therefore, the peak of car sales will surely break out!

　　(Translator: Yalong/Jessie)

　　See original Chinese report Please click:http://suhuiauto.blog.sohu.com/151079673.html