On October 13th, Dongfeng LanTu's all-new pure electric SUV, the Zhiyin, was launched. This follows the Ledao L60, JiKr 7X, ZhiJie R7, Avista 07, and the all-new ZhiJi LS6, making it another model targeting the Tesla Model Y.
"Golden September and Silver October" is the season when automakers launch a dense array of new products in the fall, and it is also a traditional peak season for car consumption. Data shows that although China's automobile production and sales decreased year-on-year in September, they achieved double-digit growth month-on-month. In particular, the production and sales of passenger cars, which are mainly used for private households, ended a five-month consecutive decline, becoming a new highlight of the "Golden September and Silver October."
Passenger car production and sales are gradually picking up.
"On the last day of the National Day holiday, Zero Run's sales once again reached a new high, with over 17,000 firm orders during the 7-day holiday," said Zhu Jiangming, founder, chairman, and CEO of Zero Run Automobile, on the evening of October 7th, showing off the National Day promotion results on his WeChat Moments.
In addition to Zero Run Automobile, many car companies' orders during the National Day Golden Week also reached new highs, with Hongmeng Zhixing's firm orders exceeding 28,600 units, Xiaopeng Automobile with 16,000 units, Shenlan Automobile with 14,000 units, and JiKr's new firm orders breaking through 10,000 units. Fan Junyi, the general manager of Geely Automobile Sales Company, told reporters: "During the National Day Golden Week, the sales volume of the entire Geely brand significantly increased, with fuel vehicles growing by 29% compared to last year, and new energy vehicles, driven by the Galaxy E5 and Star Wish, saw an even larger growth rate."
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Data shows that in September, China's automobile production and sales were completed at 2.796 million and 2.809 million units, respectively, down 1.9% and 1.7% year-on-year, but up 12.2% and 14.5% month-on-month, respectively. Among them, the production and sales of passenger cars, mainly for private use, were 2.502 million and 2.525 million units, respectively, up 12.6% and 15.8% month-on-month, respectively, and up 0.2% and 1.5% year-on-year, respectively, ending a five-month consecutive decline.
"With the national level of automobile scrapping and renewal subsidy efforts strengthening, local replacement and renewal policies taking effect one after another, and car companies launching new products in the fall, the passenger car market is gradually picking up, especially the terminal retail market continues to strengthen, and the 'Golden September' effect continues to be evident," said Chen Shihua, deputy secretary-general of the China Automobile Association.
To expand car consumption, in March of this year, the Ministry of Commerce and 14 other departments jointly issued the "Action Plan for Promoting the Exchange of Used Consumer Goods for New Ones," followed by the "Implementation Rules for Auto Exchange Subsidies." In August, the "Notice on Further Doing a Good Job in Auto Exchange" was issued, raising the subsidy standards for individual consumers who scrap and renew from 10,000 yuan for purchasing new energy passenger cars and 7,000 yuan for purchasing fuel passenger cars to 20,000 yuan and 15,000 yuan, respectively. On this basis, various places have accelerated the introduction of relevant policies according to local conditions and increased efforts to promote the exchange of used cars for new ones. As of 24:00 on October 7th, the Ministry of Commerce's auto exchange platform has received more than 1.27 million subsidy applications, driving the national new car sales to exceed 160 billion yuan.
To seize the window period of the exchange policy, car companies, on the one hand, have accelerated the launch of new cars to meet the diverse and personalized needs of different consumers. In September alone, more than 50 new cars or modified models, including the Passat Pro, Shenlan L07, Aion RT, and Dongfeng Honda Lingxi L, were launched. On the other hand, they continue to expand discounts and benefits to attract consumers. For example, purchasing a NIO car currently not only entitles you to a 20,000 yuan optional subsidy but also allows you to receive an electricity subsidy voucher.
"As the car market enters the 'Silver October' cycle, car companies and dealers also enter the annual sprint stage, and increasing the discount strength is undoubtedly the most direct way to boost sales," said Yan Jinghui, a member of the Expert Committee of the China Automobile Circulation Association.The Divergent Paths of New Energy Vehicles and Fuel-powered Cars Intensify
As the production and sales of passenger cars gradually recover, the divergence between new energy vehicles (NEVs) and fuel-powered cars is also intensifying.
Looking at the new forces in car manufacturing, in September, Li Auto topped the sales chart with 53,700 units, a year-on-year increase of 48.9%; Huawei's HarmonyOS-powered vehicles delivered 39,900 units in a single month, with the AITO series becoming the mainstay of brand sales; Leap Motor's deliveries reached 33,700 units, setting a new monthly record; Xiaopeng Motors, with its MONA M03, achieved its best performance in nearly two years, with monthly sales returning to over 20,000 units; Xiaomi's car deliveries in September also exceeded 10,000 units.
From the perspective of traditional automakers, the faster and more resolute the transition to new energy, the more significant the increase in product sales. In September, BYD's car sales broke through the 400,000-unit mark, reaching 419,000 units, setting a new record for single-brand monthly sales in the Chinese car market; Geely Holding also achieved a historical high with a monthly sales volume of 308,000 units, a year-on-year increase of 17.8%. Among them, new energy vehicle sales were 152,500 units, a year-on-year increase of 59.6%, with a new energy penetration rate of 49.5%.
In contrast, joint venture car companies that are relatively slow to transform and still mainly produce fuel-powered cars continue to see varying degrees of sales decline. Data shows that in September, FAW-Volkswagen's sales were 148,000 units, a year-on-year decrease of 18.2%; the sales of GAC Toyota and SAIC General Motors were even more pessimistic, with the former at 72,000 units, a decrease of 21.8%, and the latter selling only 22,000 units.
Data indicates that in September, China's new energy vehicle production and sales were completed at 1.307 million and 1.287 million units, respectively, with year-on-year increases of 48.8% and 42.3%, respectively. The sales of new energy vehicles accounted for 45.8% of the total sales of new cars, setting a historical high for monthly production and sales; traditional fuel passenger cars sold 940,000 units domestically, a year-on-year decrease of 30%. This indicates that under the wave of electrification and intelligence, the Chinese car market is undergoing a profound structural change, with the divergence between new energy and fuel-powered cars intensifying. It can be said that new energy vehicles have become the main force driving the growth of domestic car sales.
The strong growth in new energy vehicle sales is partly due to the increasingly rich product supply. For example, in September, new energy vehicles accounted for more than 80% of the newly launched cars, providing consumers with more choices. On the other hand, it is due to the effective improvement of product strength, especially plug-in hybrids, including extended-range hybrid vehicles, which are "fuel" and "electric" capable, forming a strong substitute for traditional fuel-powered cars. "Plug-in hybrids have achieved a comprehensive surpassing of traditional fuel-powered cars in terms of energy consumption, power, reliability, intelligence, usage costs, and price," said Ouyang Ming, an academician of the Chinese Academy of Sciences and a professor at Tsinghua University.
"Currently, the policy environment for new energy vehicle consumption is still much better than that for traditional fuel-powered cars. In terms of trade-ins, the subsidies for new energy vehicles are far higher than those for traditional fuel-powered cars, which is also an important factor in promoting the continuous growth of new energy vehicle production and sales." Chen Shihua estimates that this year, China's new energy vehicle sales are expected to reach 12 million units, far higher than the expectations at the beginning of the year.
Intensified competition is forcing high-quality development.
"The limited offer price for the long-range smart enjoyment model is 179,900 yuan." On October 13th, when Shao Mingfeng, the general manager of LanTu Automobile Sales and Service Co., Ltd., announced the price of LanTu Zhiyin, the audience exclaimed, "Finally, there is a company that has rolled the price of a medium-sized pure electric SUV to under 200,000 yuan!"Although the production and sales of passenger cars are stabilizing and recovering, the price war that erupted in the car market at the beginning of last year has not shown any signs of easing. Data from the National Bureau of Statistics shows that in September, the prices of new energy passenger cars and fuel-powered passenger cars in China decreased by 6.9% and 6.1% respectively. Cui Dongshu, Secretary-General of the Passenger Car Association of China Automobile Circulation Association, said that in the first nine months of this year, there have been 195 models of passenger cars that have reduced prices in China's passenger car market, exceeding the 150 models of 2023 and significantly surpassing the 95 models of 2022.
Price competition is the most commonly used competitive means among enterprises under market economy. Based on changes in market demand, enterprises can expand their market share by reducing prices, forcing weak brands and inefficient production capacities to exit, and achieving industrial survival of the fittest. However, price wars are a double-edged sword. Once a "self-rolling" vicious competition is formed, it will not only affect the reasonable profits of enterprises but also squeeze upstream and downstream suppliers, damaging the industrial ecosystem.
The continuous price war this year has further intensified market turmoil, and car dealers have fallen into an unprecedented predicament. "In the profit structure of dealers, the loss from new car sales is severe, the gross profit contribution of new cars is negative, and the loss continues to expand," said Shen Jinjun, President of the China Automobile Circulation Association. Car companies should produce according to sales and should not blindly produce in pursuit of market share and wage price wars.
Li Shufu, Chairman of Geely Holding Group, called for car companies to drive innovation the more the market's effective demand is insufficient and the market competition is fierce. They should accelerate the formation of new quality production capacity, provide high-quality products and services, and create new value for customers. In this way, they can cross the trap of price wars, avoid "self-rolling" vicious competition, and truly promote the high-quality development of the industry.