Production and sales have declined. What impact will the COVID-19 epidemic have on the auto market?

The data on national passenger car production and sales in January 2020 have been released. Judging from the data that have been released so far, both the production and sales of national passenger cars in January 2020 have experienced a significant decline. According to Statistics from the China Urban Federation show that the national passenger car market retail sales in January were 1.699 million units, a year-on-year decrease of 21.5%, which was also the lowest growth rate since 2005. Let’s talk about the production volume first. Since January 2020 was greatly affected by the Spring Festival, the total production time during the Spring Festival is about 20 days. Therefore, it is understandable that the production volume is relatively low during the Spring Festival. However, due to the impact of the new coronavirus epidemic , after the Spring Festival, automobile manufacturers generally postponed the resumption of production. After the Spring Festival, automobile manufacturers basically have no production. Since automobile manufacturers are more responsible for assembly tasks, automobile parts are supplied by suppliers, and parts suppliers have also postponed production due to the impact of COVID-19. A car is composed of thousands of parts. If one of them is If one component cannot be produced and supplied, it will affect the assembly and production of the entire car. In the short term, it can be judged that it will take a long time to completely resume production of cars. The temporary suspension of production in factories is a relatively big problem for automobile production, causing inevitable economic losses. Let’s take a look at car sales. In January 2020, national automobile sales experienced a relatively large decline year-on-year, with total sales reaching 1,714,684 units, a decrease of 21.6% from 2,186,444 units in the same period last year. A month-on-month decrease of 21.3%. Also due to the impact of the COVID-19 epidemic, 4S stores are unable to open their doors, and 4S stores need to face the pressure of store rent and employee costs. The Spring Festival is often the peak season for car sales, so the losses are relatively serious for 4S stores. It can be predicted that 4S stores will be able to open for business at the end of February or March, and there may be certain discounts at that time to collect funds from selling cars as soon as possible. Since 4S stores often have some inventory, I think this period is just the time to clear and digest inventory for less popular models. For hot-selling models, there will be no cars to sell, because once production resumes, China's automobile manufacturing capabilities will also be very strong. Therefore, in the short term, both manufacturers and 4S stores will encounter a decline in production and sales. However, in the long term, Chinese consumers’ demand for cars will exist for a long time. After the epidemic passes, Chinese consumers will welcome There is a relatively big wave of car buying boom, so I am not bearish on the Chinese car market. Only in the short term, both manufacturers and 4S stores will face greater pressure on production and operation, especially some small brands and new car-making companies, whose ability to resist risks is relatively low. , the impact of the epidemic on them is more serious. But I also believe that during this period, the country will introduce some tax reduction policies or interest-free loan policies to major manufacturers to help us tide over the difficulties together.