Auto Market Beat – Q2 – China – July 2020
“The sales volume showed a V-shaped recovery in Q2 after the underperformance in Q1. This pattern, however, is represented by a quick recovery to the normal level of consumption rather…

Auto Market Beat – Q2 – China – July 2020

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Report Summary

“The sales volume showed a V-shaped recovery in Q2 after the underperformance in Q1. This pattern, however, is represented by a quick recovery to the normal level of consumption rather than a consumer spending surge fuelled by pent-up demand. The sales of luxury brands have been stable through the first two quarters, reflecting the resilience to risks of the wealthiest consumers. On the other hand, in offering greater discounts, mass joint ventures also realised an increase in sales. Along with shifting offline advertising to online marketing, brands have also diversified their marketing approaches and themes to resonate with consumers. To stand out in a red ocean with fierce competitions, it is important to build closer relationships with consumers, establish a caring brand image and develop trustworthiness.
– Terence Zhou, Senior Research Analyst

Table of Contents

  1. Overview

    • What you need to know
      • Covered in this report
        • Excluded
        • Executive Summary

            • Analysis on the market conditions: more regulations on sub-categories relieve the concern of car buyers
              • Ease purchase and road restrictions to drive environment-oriented upgrade purchases
                • Speed up the establishment of NEV safety standards
                  • Encourage circulation of second-hand cars and drive car upgrade purchases
                    • Vehicle inspection signs go digital nationwide
                    • Sales volume overview

                      • Sales rebound in Q2 2020 highlighted by a post-Covid surge in May
                        • Figure 1: Overall sales volume of new passenger cars, Jan – Jun 2020, 2020 vs 2019
                        • Figure 2: Overall sales and the production volumes of new passenger cars, Jan – Jun 2020
                      • The market share of sedans and SUVs stabilise while MPVs are gaining share
                        • Figure 3: Sales share of new passenger cars, by car model, Jan – Jun 2020
                      • A polarising trend: luxury sedans and joint venture sedans of the RMB 100,000 tier took the lead in sales rebound
                        • Figure 4: Top 15 best-selling sedans, Jan – May 2020
                      • Japanese brands continued to take half of the seats of the top 10 best-selling SUVs
                        • Figure 5: Top 15 best- SUV, Jan – May 2020
                      • NEVs sales rebounded but may lack long-term potential
                        • Figure 6: Sales volume of new passenger cars, Jan – Jun 2020
                    • Interpreting brand performances

                      • Luxury car sales recover quickly, showing great resilience
                        • Figure 7: Sales volume of luxury cars, Jan – May 2020
                      • Mercedes-Benz suffered a plunge in market share while Audi made its way back to the top
                        • Figure 8: market share of luxury car brands, Q1 vs April – May 2020, by market share in April and May 2020
                        • Figure 9: sales volume of all Audi models, Q1 vs April and May 2020
                        • Figure 10: sales volume of all Mercedes-Benz models, Q1 vs April and May 2020
                        • Figure 11: sales volume of all Cadillac models, Q1 vs April and May 2020
                    • Market share of domestic auto brands shrinks

                        • Figure 12: Sales share of new passenger cars, by country, Jan 2020 – May 2020
                      • Leading domestic brands in Q2 plunged, while joint venture brands rose steadily
                        • Figure 13: Market share of auto brands, Jan 2020 – May 2020, ranking by the brand market shares in April & May 2020
                      • Volkswagen SUV models stepping up their efforts to maintain the largest market share
                        • Figure 14: Sales volume of all Volkswagen models, Q1 2020 – April & May 2020
                      • All Honda car models see increasing sales with its market share catching up to Toyota
                        • Figure 15: Sales volume of all Honda models, Q1 2020 – April & May 2020
                      • Buick launched substantial discounts to drive the sales in Q2
                        • Figure 16: Sales volume of all Buick models, Q1 2020 – April & May 2020
                      • Tesla Model 3 enjoys significant advantages in sales, while Chery eQ and ORA take new approaches
                        • Figure 17: Top 10 best-selling BEVs, ranking by sales volume in April & May 2020
                        • Figure 18: Chery eQ and ORA R1
                        • Figure 19: Top 10 bestselling PHEVs, ranking by sales volume in April & May 2020
                      • Expert interview columns: direct retailing and dealer modes have their own strength and will not be replaced by each other in near future
                        • The challenge of direct retailing: great pressure on cash flow
                          • The strength of direct retailing: the end customer experience is under control
                            • Development trends in future: separate showcases for sales from aftersales service for cost optimisation
                            • Marketing Campaigns

                              • Social distancing themed logos
                                • Figure 20: The COVID-19 edition logos of Mercedes Benz, Volkswagen, Hyundai and Audi
                              • Audi invited multiple celebrity spokespersons for its live streaming marketing campaigns
                                • Figure 21: Audi A4L online product launch
                                • Figure 22: Tag promotion – #Brand new A4L, be a stronger self
                              • Volvo featured employees in advertisement to show they care
                                • Figure 23: Volvo 93rd anniversary commercial
                              • Cadillac establishes the connection between “rear wheel drive” and “luxury” through relevant scenes
                                • Figure 24: No rear drive, not luxury
                                • Figure 25: Golden Rules from the Second-time Experience
                              • From masks to river snails rice noodles: Wuling Hongguang marketing campaigns go with the tide
                                • Figure 26: Wuling’s marketing campaigns follow the ride
                              • Understand car retailing based on consumer data: find the perfect balance between online and offline channels
                                • Figure27: Acceptance of online car purchase, March 2020
                            • Technological innovation

                              • BMW introduced electronic car keys and car features subscription
                                • Figure 28: BMW electronic car key
                              • Solar power car roofs
                                • Figure 29: Model 3 with a solar charging board
                              • JD and SAIC Volkswagen are collaborating to develop smart home built-in systems
                                • Figure 30: JD MicroConnect
                            • Appendix – Market Size

                                • Figure 31: Total sales volume of new passenger cars,China,Jan 2020-Jun 2020
                            • Appendix – Market Segmentation

                                • Figure 32: Total sales volume of new passenger cars,China, Jan 2020 – Jun 2020
                                • Figure 33: Total sales volume of PHEVs,China, Jan 2020 – Jun 2020
                            • Appendix – Methodology and Abbreviations

                              • Methodology
                                • Abbreviations

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