Continuing above the warning line, the car dealers' inventory warning index was 53.7% in May.

According to the "Vehicle Inventory Alert Index" published by the China Automobile Dealers Association, the Inventory Inventory Early Warning Index for China's Automobile Dealers VIA (Vehicle Inventory Alert Index) shows that in May 2018, the inventory warning index of automobile dealers was 53.7%, a decrease of 0.9% from the previous month and a year-on-year increase of 1.9 percentage points. The inventory warning index is above the warning line.

The dealers reflected that the market in May was quite different from expectations, and the May Day holiday did not drive sales in the auto market. The tariff adjustment policy for imported cars has lengthened the wait-and-see period for imported car customers; in some regions, investment in enthusiasm for real estate investment has affected consumers' investment in car purchases; in some regions, the rural consumers' store-to-store rate declines during the busy season. Car prices continued to decline in May, and dealers are still under pressure to operate.

From the perspective of the sub-index, the inventory index, employees, and business conditions in May decreased month-on-month, and the market demand index and average daily sales index rose.

From the perspective of the regional index, the national total index in May was 53.7%, the northern index was 51.7%, the western index was 56.2%, the southern index was 53.9%, and the eastern index was 56.2%. The northern region index was basically the same as last month, the eastern region index rose slightly, and the southern region index and the western region index decreased.

From the sub-brand type index: In May 2018, the joint venture brand index was basically flat, and the import & luxury brand index and self-owned brand index decreased from the previous month.

According to the survey, dealers expect the market demand in June to be equal to that in May, and the auto market will continue to be dull. In June, the sales sprint in the second quarter and the first half of the year will inevitably lead to price competition; import vehicle customers will be affected by tariff adjustment policies. The passenger flow will continue to decline. Customers will pay attention to the July car price situation and wait and see more.

The China Automobile Dealers Association recommends that dealers should rationally estimate the actual market demand and reasonably control the inventory level in light of the actual situation to prevent excessive inventory pressure and lead to operational risks.

Attachment: Survey on Early Warning Index of Automobile Dealership Inventory and Regional Classification Standards

1, the car dealer inventory warning index survey description

As early as March 2010, the China Automobile Dealers Association proposed the construction of an “inventory early-warning system,” and began conducting regular inventory surveys of automobiles and dealers in July 2010. In 2012, in order to respond more positively to the developments of the industry, the Association has spent more than six months researching and constructed an early warning index for car dealerships.

The purpose of the early warning index survey for car dealership stocks is to: First, grasp the pulse of the market. By investigating the inventory status of car dealerships across the country, the overall status of the industry is monitored in a timely manner, and future market trends are forecasted. Second, decision-making is assisted. Through understanding the dealer inventory changes, it provides accurate information for relevant departments to formulate regulatory measures. Third, monitor operational risks. Timely reflection of the fluctuations in the production and sales of the automotive market, the rational arrangement of production plans for manufacturers, and the provision of reference for dealers in formulating marketing strategies and controlling business risks.

According to the principle of PMI preparation, the inventory early warning index adopts the method of expanding the index, with 50% as the line. 50% are within a reasonable range. The higher the inventory warning index, the lower the demand reflecting the market, and the greater the inventory pressure, the greater the operating pressure and risk.

In order to enhance the forward-looking and forecasting function of the inventory early-warning index and draw on the ideas and methods of the PMI index, the inventory early-warning index sets an index that closely relates to the changes in car inventory to form a comprehensive index. The relevant indicators mainly include: the total demand of the automotive market, The 4S shop sets passenger volume, transaction rate, price changes, sales volume changes, inventory changes, changes in the number of employees, liquidity status, and operating conditions.

The inventory survey of dealers this month was mainly for the 2016 China Top 100 Automobile Distribution Group. It covers more than 1,000 4S shops in most provinces across the country and has extensive brand coverage covering 55 major import, joint venture and autonomous auto brands in the domestic market.

2, the regional standard

North District contains provinces and regions: Beijing, Hebei, Henan, Heilongjiang, Jilin, Liaoning, Inner Mongolia, Shanxi

Southern District includes provinces and regions: Fujian, Guangdong, Guangxi, Hainan, Hubei, Hunan, Jiangxi

Eastern District includes provinces and regions: Anhui, Jiangsu, Shandong, Shanghai, Tianjin, Zhejiang

Western provinces and regions include: Gansu, Guizhou, Shaanxi, Sichuan, Xinjiang, Yunnan, Chongqing, Ningxia, Qinghai, Tibet