Chinas five year sales transition period extended by 60000 yuan for parallel import vehicles

 Chinas five year sales transition period extended by 60000 yuan for parallel import vehicles

Kong Xiangming is the general manager of Dongrun automobile trade (Tianjin) Co., Ltd., mainly engaged in parallel import vehicle business. Since most of the parallel import vehicles meet the national five-year emission standards, Kong Xiangming believes that some more goods can be stored before July 1. We sold about 60 or 70 cars in April, although it was only two-thirds of the same period last year, but it is still significantly better than February and March. Now the supply is in short supply, there are more foreign customers coming to order, and the price is generally rising. Kong Xiangming told the Beijing News in an interview that the price increase of the Middle East model is the most obvious, with a small increase of 12000 and a hot-selling model of 60000.

Regions without implementing the sixth emission plan in advance are the hot spots for Middle East models

Parallel import vehicle refers to the vehicle purchased from overseas market and introduced into Chinese market for sale by traders without authorization of brand manufacturers. In recent years, it has entered China as a legal identity. Compared with the Zhonggui car (the imported car sold by the 4S shop), the price is relatively cheap, which is the biggest advantage. At the same time, it has more models than the 4S shop, which is also the reason why the market is gradually mature.

From January 1, 2020, Beijing began to implement the national 6B emission standard for light gasoline vehicles and heavy diesel vehicles in advance. This also means that most brands of parallel imported vehicles, especially the more popular Middle East models such as Toyota bully, Toyota Lu Xun, Nissan Tule and Mitsubishi, can not meet the national six emission standards, so new cars can not be licensed in Beijing.

According to Wilsons statistics, at present, the provinces and cities that implement the sixth national emission plan ahead of schedule also include Tianjin, Shanxi, Hebei, Shanghai, Henan, Guangdong, Hainan, Sichuan (Chengdu Chongqing region), Shaanxi (Guanzhong region), etc. For Liaoning, Jilin, Heilongjiang, Fujian, Jiangxi, Hubei, Hunan, Guangxi, Guizhou, Yunnan, Tibet, Gansu, Qinghai, Ningxia, Xinjiang and other provinces, as well as Shanxi, Inner Mongolia, Sichuan, Shaanxi and other provinces that have announced the implementation of the six emission standards, before January 1, 2021, the sales of five models are allowed. These regions also became the main sales areas of parallel import vehicles in this year.

Chen Zumings company mainly deals with Land Rover models and Middle East hot models. For economically developed regions, such as Southeast China, Land Rovers parallel import vehicles sell well, and the Middle East model has good off-road capability, which can be applied to regions with special road conditions, mainly sold to southwest, northwest and northeast. At present, although most provinces and cities in Southeast China have implemented the national six emission standards in advance, Chen Zuming also sees hope after the extension of the national five-year sales transition period. After the extension of the sales time, he will not worry about selling.

The postponement of the sixth national emission standard is also a good window period for dealers of parallel import vehicles to clear their inventory. Wu Yuting, a Wilson market analyst, told reporters that regions such as the northeast, which have not yet implemented the sixth national emission plan, will also contribute to the sales of parallel imported vehicles. According to Kong Xiangming, the main sales areas of the Middle East model are mainly northeast, northwest, southwest, etc. the extension of the sixth emission standard has increased the time for us to clean up the inventory for nearly half a year, so it is a very good thing for us, or a blow to the industry.

Out of print model from losing money to rising sharply

As the largest parallel import automobile import port in China, Tianjin has more than one thousand dealers, accounting for more than 70% of the total sales of the country. According to the Tianjin parallel import Automobile Circulation Association, during the May 1st period, nearly ten thousand foreign dealers and sellers came to Tianjin to consult and purchase parallel import automobiles, completed the wholesale of more than 480 vehicles, terminal retail of more than 200 vehicles, and the sales revenue exceeded 400 million yuan.

At present, the Middle East model is in short supply. Kong Xiangming told the Beijing news that from February to May this year, the price of some hot models in the Middle East version looks like a roller coaster ride. The market price of all models has been raised. For example, Toyota can go from May 1 to now. The price of a single model may go up to 20000-30000, and some of the hot sales will go up to 40000-50000. According to the data, the market share of Middle East models in parallel import vehicles accounts for nearly 70%. Especially Toyota. Toyota is the brand with the largest market share of parallel import vehicles, with a market share of 44.4% u3002

As for the sharp rise in prices, Kong Xiangming thought that this was a reflection of the changes in market supply and demand and a return to normal market prices. The spread of foreign epidemic situation has greatly reduced the supply of parallel import vehicles. In addition, the specific policies for parallel import vehicles implemented in the future are not clear, and dealers can not store a large number of vehicles. More importantly, the Middle East model is also known as the out of print model in the industry because it is difficult to meet the national six emission standards, which has prompted the market to have a retaliatory purchase and price increase.

Up or down by the end of the year? It also depends on market supply and demand

Its said that Lao Shi regretted the price hike, but he told reporters, Im not worried about it anyway. Lets see the price in the second half of the year or before the end of the year.

Will this happen before the end of this year? In Chen Zumings view, its unlikely that the Middle East models will reduce prices and dump goods before the end of the year. Its very difficult for Middle East models to meet the national six emission standards. Models like kuluze and Sena dont have standard cars. 4S stores cant buy them. They can only buy parallel imported cars. As the supply of goods decreases, they may become out of print, so the price will definitely rise. However, he also said, there are parallel imported cars of the same model with 4S stores. If 4S stores reduce prices, we will also reduce prices, otherwise we cant sell them.

Due to the decrease of goods supply caused by foreign epidemic, and the recovery of purchase demand in April and may, some models will be scarce, so the price will rise. Wang Cun, director of the import vehicle Committee of China Automobile Circulation Association, told reporters that after the introduction of the policy, dealers will also be busy with increasing orders in the second quarter, and the whole industry will fluctuate.

Middle East version or out of print, hot models are not out of print

An insider told the Beijing news that Chinas emission standards before the Fifth Five-Year Plan are usually based on European standards, and most of the vehicles previously meeting the five-year plan can enter China. The six standards of our country is a new set of emission standards, which is different from the six standards of Europe. At present, the parallel import vehicles on sale in China mainly include Middle East version, American version, Canadian version and Mexico version. Among them, the American and Canadian models are close to the sixth national standard, while the Middle East models are far from the sixth national standard.

The postponement of the implementation of the sixth national standard is undoubtedly the lifeline for the dealers of parallel imported vehicles to extend their sales. However, in the face of the comprehensive implementation of the sixth national standard in the future, how should they deal with it?

The opportunity for the Middle East model to enter the domestic market is very slim. There may be hope for the American version and the Canadian version. For our dealers, they are waiting for the introduction of the national implementation rules for parallel import vehicles. If other versions can meet the requirements, we will actively cooperate with the relevant parts to carry out the national six standard test for vehicles. Kong told reporters.

Other countries such as Europe and the United States will also have Toyota models, so long as they meet the national six emission standards, they can also enter the domestic market. Wang Cun told reporters of the Beijing News. One of the advantages of parallel imported cars is the price. Dealers can also develop other import channels to pick up cars in Europe, America and other countries. But market development will take a certain time, which also means that the market of parallel import vehicles may decline next year, and then it may recover slowly, but it is still very difficult to recover to last years 167000 vehicles.