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The future of China’s auto sales in 2021 From accenture

The following is the The future of China’s auto sales in 2021 From accenture recommended by And this article belongs to the classification: accenture , Automobile industry, research report.

In 2020, Accenture conducted a survey on more than 1000 Chinese consumers and 250 auto dealers who recently bought new cars in China, and interviewed 12 domestic and foreign industry executives and Chinese auto market experts. We find that the behavior habits of Chinese automobile consumers have undergone profound and irreversible changes; at the same time, there is a big cognitive gap between consumers and dealers. The process of changing and bridging the differences between the two sides will give birth to a new auto sales path in the Chinese market.

Contradictory Chinese consumers

“Cars give themselves a sense of freedom on the spiritual level” – this is the voice of 56% of the respondents. The health crisis has further stimulated the demand for independent transportation, especially in big cities. New travel services such as car sharing and online car Hailing are rising at the same time.

COVID-19’s impact on China’s consumers

More than 70% of consumers prefer to shop online because it is easier to compare prices and vehicle parameters, study user comments and feedback. However, most consumers (77%) want to complete the transaction through physical channels and enjoy the experience of “touch and feel”. The establishment and management of seamless integration of online and offline sales mode is imperative.

Channel preference of consumers in the process of sales

The survey also found that Chinese consumers visit an average of 2.5 dealers before buying a car, and 95% of potential customers visit multiple dealers of the same brand, which is more for price comparison. But in fact, price negotiation is the primary factor of consumer dissatisfaction – four fifths of Chinese consumers prefer clear pricing rather than bargaining, because it helps them firm their purchase decisions and enhance their trust in sales consultants.

Car dealers face challenges

Dealers are the mainstay of China’s automobile retail, and they have a wide range of influence in pricing, retail marketing and customer relationship management. However, in the face of changes in consumer demand, the weaknesses of the traditional sales model are gradually emerging: it is difficult to create excellent consumer experience, especially the lack of online and offline integration experience; the lack of price consistency leads to internal friction between different dealers under the same brand.

According to the survey, about a third (25-36%) of dealers said that new car sales had no profit margin for them. The dealers mentioned that 69% of the customers would take the initiative to contact other dealers under the same brand, and 29% of the dealers thought that this was one of the biggest threats to their business. In addition, under the influence of the increasingly fragmented consumer contacts and the demand for online and offline channel integration, the third-party platform is booming. As a result, dealers and vehicle manufacturers have lost many opportunities to face consumers directly, and are subject to the rising investment costs. 57% of dealers believe that this constitutes a major threat to their business.

Chinese dealers consider the biggest threat to their business

81% of dealers agree that their own business model needs to be changed in order to continue to grow in the future. In fact, many dealers have realized that customers’ purchase preference is shifting online. Almost all dealers (99%) use digital tools to support marketing and sales. 81% of dealers can provide online test drive service, 78% of dealers allow mobile payment to purchase cars, and more than 70% of dealers provide direct digital interaction.

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