SUV sales hit a 7-year low, electric SUV may be the best tool to break the deadlock

In the past few years, the SUV market has grown rapidly, and domestic automakers have made a comeback by seizing the SUV market. Just when people were speculating whether the SUV market share would exceed that of sedans, starting from April this year, the growth rate of SUVs was surpassed by sedans for four consecutive months, setting a new low in the past seven years.

Seemingly overnight, the SUV craze died down.

Why are SUVs not selling well anymore?

The rapid growth of SUVs in the past few years has led to a continuous expansion of the SUV market base. Now that the SUV base is already considerable, it is normal for the growth rate of SUVs to slow down to a certain extent.

The recent downturn in the auto market has also affected SUV sales. In July, China's passenger car wholesale sales fell 5.7% year-on-year to 1.57 million units, and fell 14.66% month-on-month, showing a significant negative growth. Not only SUVs, but also sedans, MPVs and other categories have seen a decline in sales.

However, compared with sedans, the growth rate of SUVs has declined more sharply. In July, sedans fell 3.8% year-on-year, while SUVs fell 6.9% year-on-year.

my country's restrictions on high-fuel-consumption models are also an important reason why SUVs are not popular. For consumers, high-fuel-consumption SUVs mean higher travel costs. The trend of domestic oil prices fluctuating and rising has forced consumers to carefully consider fuel consumption when buying a car.

With the gradual promotion of new energy vehicles, the shortcomings of SUVs in terms of fuel consumption have become increasingly prominent. More and more consumers are starting to choose electric vehicles to save fuel expenses.

For car manufacturers, the support policy for new energy vehicles, especially the implementation of the double credit policy, requires the consumption of positive credits for each SUV fuel vehicle sold, which requires additional costs. If the car companies do not have enough positive credits, they will have to purchase positive credits or increase investment in new energy vehicles.

The decline in SUV sales is not only due to external reasons, but also due to problems with the SUV products themselves.

In July, 9 of the top 10 SUV models were on the market for more than a year, and the aging phenomenon is very serious. Among the top 10 sedan models, many models have been on the market for a short time and are in the period of strong product vitality.

The current decline in SUV sales is mainly due to the decline in sales of low-end models, while sales of mid-to-high-end SUVs are increasing. Against the backdrop of automobile consumption upgrades, SUVs on the market are being updated slowly and their models are highly homogenized, dampening the market's enthusiasm for SUV consumption.

At present, the market demand for entry-level SUVs in third- and fourth-tier cities is gradually saturated. At the same time, with the upgrading of automobile consumption and the increase in the proportion of second-time car buyers, Chinese consumers are increasingly demanding mid- to high-end SUVs.

Although domestic automakers have a high market share in the SUV market, their hot-selling models are mainly low-end models. Although joint venture brands have begun to exert their strength in the SUV market, they have not yet formed a scale. Both domestic and joint venture brands have insufficient investment in the mid-to-high-end SUV market segment, and these upgraded car consumption needs have to be transferred to the purchase of mid-to-high-end sedans.

Can SUVs make a comeback?

On the other hand, the top-ranked sedan models are all economical and suitable for family use, and are still mainly for family use. This is actually consistent with the mainstream demand of the SUV market. If SUVs can update their products in a timely manner and closely follow market demand, once enough SUV products that meet market demand are launched, the SUV market is likely to have a second spring.

As SUVs continue to be optimized in terms of space, passability, comfort, etc., their advantages over sedans are becoming increasingly stronger, and SUVs still have great market potential.

At present, domestic brands still mainly focus on low-end SUVs in the SUV market. In response to the market demand for mid-to-high-end SUVs, domestic brands should step up their layout. It is also safer for domestic brands to start from the SUV field where they are more proficient.

For domestic brands, they have a good foundation in the SUV field. Although joint venture brands entered the SUV market relatively late, they are strong and have excellent product quality. Foreign and joint venture brands are increasing the launch of SUV models and at the same time lowering their profile to compete with domestic brands for the entry-level SUV market, which is likely to bring a considerable impact on domestic brands in the future.

From the perspective of the global market, in 2016, SUV sales in the US auto market exceeded sedan sales for the first time. my country's market preference for cars is similar to that of the US, and SUVs that have advantages in space and appearance are more popular.

In 2017, global SUV sales reached a record 27.85 million units, a year-on-year increase of 12.7%. The market share has exceeded 32%, and the share of SUV in the global market is also on the rise.

Considering the disadvantage of electric vehicles in terms of endurance, hybrid vehicles will play an important transitional role in the next few years. Hybrid vehicles are more suitable for SUV models because they need to be equipped with both fuel and electric systems.

With the gradual development of the new energy vehicle market, the small pure electric SUV market has great development potential, which will have a certain driving effect on the market growth of SUVs.

At present, major traditional automobile companies and new car-making forces prefer pure electric SUVs when launching new energy models. Pure electric SUVs have become the focus of automobile companies.

Next, domestic brands are likely to maintain and consolidate their advantages in the SUV market through the development of pure electric SUVs. The development of new energy vehicles provides a new opportunity for the increase of SUV market share.

At the same time, it should be recognized that the current decline in SUV sales has a great impact on domestic brands that rely heavily on SUVs. However, the advantages of Geely, SAIC and other automakers that previously insisted on developing sedans and SUVs are becoming increasingly prominent.

Although domestic brands have achieved good development with the help of the SUV market dividend, the period of wild growth in the SUV market has passed. Although there is still a chance to turn around compared to sedans, if they still rely solely on SUVs, it will ultimately be detrimental to the long-term development of the company.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.