China Automobile Dealers Association: A brief analysis of the used car market in June 2024

Overall performance of the used car market in June 2024

In June 2024, the national used car market transaction volume was 1.519 million vehicles, a month-on-month decrease of 4.14% and a year-on-year decrease of 0.93%, and the transaction amount was 97.82 billion yuan.

From January to June 2024, the cumulative transaction volume of used cars was 9.3829 million units, a year-on-year increase of 7.01%, an increase of 614,300 units compared with the same period, and the cumulative transaction amount was 625.212 billion yuan.

In June, the market officially entered the traditional off-season, with the second-hand car transaction volume of only 1.519 million vehicles, the first negative growth in monthly year-on-year terms, down 0.9% from the same period last year. At the same time, the second-hand car manager index in June also fell significantly to 41.2%, down 2.4 percentage points year-on-year and 1.7 percentage points month-on-month, highlighting that the second-hand car market is still in a recession.

The main reasons for the sluggish market can be attributed to the following points: First, the traditional sales off-season is caused by seasonal factors, and the demand for car purchases naturally declines; second, unfavorable weather conditions such as heavy rainfall in some areas have affected consumers' travel and car purchasing intentions; third, changes in the macroeconomic environment have caused some potential car buyers to postpone their car purchase decisions in order to cope with economic pressure.

From January to June 2024, a total of 9.383 million used cars were traded, a year-on-year increase of 7%. Although the growth rate has slowed down compared with the previous period, the overall market still maintains a steady growth trend.

The used car market in the first half of the year had significant characteristics, mainly reflected in the following two aspects:

Prices hover at low levels, market structure changes: Affected by the dual effects of intensified market competition and changes in consumer demand, the average price of used cars continued to hover at a low level in June, at only 64,400 yuan. Since February this year, the average price of used cars has been on a downward trend. Although the average price has increased slightly compared with the same period last year, this is mainly due to changes in the market structure rather than a substantial increase in vehicle prices. This price change feature shows that the current used car market is facing greater competitive pressure and consumer demand is also undergoing profound changes.

Active cross-regional circulation and enhanced market vitality: Active cross-regional circulation has become a highlight of the used car market. In order to expand market coverage and effectively alleviate inventory pressure, cross-regional circulation in the used car market continues to be active. In the first half of the year, the average outward migration rate was as high as 28.8%, an increase of 2.6% over the same period. This data fully demonstrates the strong liquidity and high activity of the used car market across the country. As one of the driving forces for the upward development of the used car market, cross-regional circulation is constantly injecting new vitality and opportunities into the market.

From the perspective of market demand, the uncertainty of the external economic environment in June increased significantly, the internal effective demand remained weak, and some expectations of enterprises and residents did not seem strong enough. However, as the national "old for new" policy gradually showed results, various regions have introduced and followed up on corresponding policy measures, bringing certain positive factors to the market. At the same time, the price war of new products in the automobile market has also shown a phased cooling trend, which is conducive to improving the overall automobile market environment.

Faced with the dual challenges of fierce competition in the new car market price war and industry reform, the used car industry must accelerate iteration and upgrade to transform challenges into opportunities for transformation. Enterprises need to speed up the iteration of marketing methods, promote the transformation from brokerage to distribution, accelerate the process of digital and refined development, and increase the intensity of branding and professional management reform. At the same time, the industry should seize the development direction of new industries such as used car exports, innovate profit models, and open up new market space.

In this process, building an honest and transparent industry environment has become a vital task. The used car industry can win the trust of consumers by improving its after-sales service guarantee system and service quality. Only by allowing consumers to buy used cars with confidence can their consumption enthusiasm be stimulated and the breadth, depth and activity of used car transactions can be further expanded.

Analysis of used car structure by model in June 2024

Passenger car situation: In June, a total of 872,100 basic passenger cars were traded, a decrease of 5.14% month-on-month and a decrease of 3.92% year-on-year; a total of 205,900 SUVs were traded, a decrease of 1.91% month-on-month and a year-on-year increase of 5.26%; a total of 95,200 MPVs were traded, a decrease of 3.18% month-on-month and a year-on-year increase of 0.08%; a total of 36,000 crossover passenger cars were traded, a decrease of 6.03% month-on-month and a year-on-year increase of 22.34%.

Commercial vehicle situation: A total of 84,900 passenger cars were traded, a decrease of 3.76% month-on-month and 4.62% year-on-year; 125,000 trucks were traded, a decrease of 4.42% month-on-month and 1.30% year-on-year.

In terms of year-on-year sales, SUVs and crossover passenger cars showed some growth momentum in the passenger car market in June, while basic passenger cars and MPVs faced pressure from declining sales. The overall performance of the commercial vehicle market was weak, with sales of buses and trucks showing a downward trend both year-on-year and month-on-month.

From January to June, the cumulative transaction volume of passenger cars was 7.5279 million, a year-on-year increase of 6.91%. Among them: the cumulative transaction volume of basic passenger cars was 5.4602 million, a year-on-year increase of 4.66%; the transaction volume of SUVs was 1.2550 million, a year-on-year increase of 12.1%; the transaction volume of MPVs was 592,100, a year-on-year increase of 10.81%; the transaction volume of crossover passenger cars was 220,700, a year-on-year increase of 29.50%.

The total number of commercial vehicles traded was 1.2749 million, a year-on-year increase of 2.18%. Among them, 745,100 trucks were traded, a year-on-year increase of 3.02%; and 529,800 buses were traded, a year-on-year increase of 1.02%.

From January to June, both the passenger car and commercial vehicle markets achieved positive year-on-year growth. Among them, the passenger car market performed particularly well, especially SUVs and crossover passenger cars; the commercial vehicle market remained stable, with trucks making a significant contribution.

Analysis of vehicle age in used car transactions in June 2024

In June 2024, among the six major regions in the country, only the Northeast region saw a month-on-month increase in transaction volume, while other regions all showed declines to varying degrees, with the declines in the Northwest, East China, and Southwest regions exceeding 5%.

The second-hand car transaction volume in East China was 439,100 units, a month-on-month decrease of 5.14%, and the transaction volume decreased by 23,800 units compared with the previous month. From the perspective of specific provinces, Jiangsu, Zhejiang and Shanghai, as important economies in East China, continued to show a downward trend this month. In Shanghai in particular, the transaction volume decreased significantly, with a decrease of up to 10%. In contrast, the decline in transaction volume in Jiangsu and Zhejiang provinces narrowed compared with the previous month. The market in Anhui showed signs of recovery this month, with transaction volume increasing by 7.6% compared with the previous month. The transaction volume in Shandong, Fujian and Jiangxi also declined this month, and market pressure is still significant.

The used car market in central and southern China showed an overall downward trend this month, with a total transaction volume of 434,900 vehicles, a decrease of 21,000 vehicles from the previous month, a decrease of 4.61%. Specifically, the transaction volume in Guangxi Province fell most significantly, down 8.1% month-on-month. In comparison, the declines in Guangdong and Hubei provinces were smaller, down 3.5% and 3.8% respectively. In addition, the transaction volume in Henan, Hunan and Hainan provinces also fell by more than 5%, and the market performance remained sluggish.

The second-hand car transaction volume in North China was 210,000 units, down 2.84% from the previous month and 6,100 units less than the previous month. Specifically, the market demand in Beijing, Hebei and Shanxi continued to weaken. In particular, the transaction volume in Shanxi Province fell by 7.8% from the previous month, a significantly larger decline than the previous month, indicating that market pressure has intensified. The transaction volume in the Beijing market fell by 3.7%, and the market is still weak. The Tianjin market has slightly recovered this month, up 2% from the previous month. The Inner Mongolia market has performed relatively well and has continued to recover recently.

A total of 240,700 vehicles were traded in the southwest region this month, a decrease of 5.17% from the previous month and 13,100 vehicles less than the previous month. The market in Sichuan and Chongqing has continued to weaken recently, especially in Chongqing, where the transaction volume has declined significantly this month, with a drop of 14%. Sichuan fell by 4.7% from the previous month, and the decline has slowed down. Guizhou and Tibet showed signs of recovery this month, with Guizhou increasing by 7.3% from the previous month and Tibet increasing slightly by 3.6%. Yunnan's transaction volume fell by 7.2% this month, and the market is still sluggish.

The overall market in Northeast China rebounded this month, with 118,000 used cars traded, up 3.08% from the previous month. The transaction volume increased by 3,500 vehicles from the previous month. This month, the Liaoning market showed a clear recovery trend, with a 7.2% increase in transaction volume from the previous month. The Jilin market has performed well recently and maintained an upward trend this month, up 1.5% from the previous month. The decline in Heilongjiang this month narrowed further, with a slight decrease of only 0.6 percentage points from the previous month.

The second-hand car market in Northwest China showed an overall downward trend this month, with a total transaction volume of 76,400 vehicles, a decrease of 5,100 vehicles from the previous month, a decrease of 6.22%. Shaanxi, Gansu, Ningxia, Xinjiang and Qinghai all showed a downward trend this month, with a decrease of about 3% to 8%. The second-hand car market in Northwest China performed relatively weakly this month, with greater market pressure in various regions and weakened demand.

Cross-regional circulation in 2024

In June, the second-hand car transfer rate was 28.42%, down 0.25% from the previous month and up 1.39% from the same period last year. The total number of second-hand car transfers was 431,700, down 4.98% from the previous month and up 4.16% from the same period last year.