Over 60% of car dealerships achieved profitability in 2010

Yesterday, a reporter from the Southern Metropolis Daily received a "Dealer's Satisfaction Survey 2010" from the China Automobile Dealers Association, which showed that most distributors were in good condition this year, and more than half (55.4%) of dealers expressed their business conditions in 2010. Satisfied, 67.9% of dealers are in profit.

More than 60% of dealers profit

If, at the beginning of 2010, forced by the high production and sales targets of the manufacturers, dealers generally faced the expected pressure of 2010, and from the above-mentioned “Dealer's Satisfaction Survey 2010” provided by the China Automobile Dealers Association, more than 60% (67.9%) of car dealers are in profit, and only 13.6% of car dealers are in loss.

BYD, which started in April last year, has “backed the net” and its own brand has rapidly returned to its normal state after experiencing a surge in 2009, and dealers with unprofitable profits have begun to invade. In the aforementioned dealer satisfaction survey, the vast majority (66%) of the “lossy” car dealerships are self-owned brands. In addition, 30.1% of the "lossy" car dealerships are joint venture brands, and less than 4% are imported car brand dealers.

Reports from Southern Metropolitan reporters also learned that in the Guangzhou and Shenzhen markets, for example, car sales showed a U-shaped curve throughout the year. Even though it was a trough in June, car sales in September and December all rushed to new highs. The strong sales volume, the recovery of auto terminal prices, and the stable profit after the sale, the overall profitability of dealers is good. In terms of imported brands, 2010 was a good time to catch up. The BMW X-Series had been queuing for up to 5 months, and Land Rover's car-lifting time had grown to 3-6 months.

Profits are good, dealers have money, naturally satisfied with the operating conditions in 2010. According to the 2010 Dealer Satisfaction Survey, 55.4% of the dealers were satisfied or very satisfied with the operating conditions in 2010. The “general” accounted for 31.7%. In addition, only 12.9% of car dealers were “unsatisfied” or “very dissatisfied” with the operating conditions in 2010.

Old shop is better than new store

The above survey results show that, as a whole, the operating conditions are directly proportional to the operating years of dealerships, and the longer the operating period, the better the operating conditions of the stores.

For 4S stores that have been in business for more than 5 years, 77.3% of dealers can make profits, and only 8.1% of dealers have losses. Among 4S shops that have been operating for 3-5 years, the operating conditions are slightly inferior to the former. The proportion of dealers dropped to 66.1%, and the loss increased to 11.5%; the days of auto dealers whose business life was less than 3 years were more embarrassing, 23.7% of dealers were in deficit, and 21.9% of dealers were on the verge of profit and loss. The income and expenditure just happened to be equal, and the profit was just over half (54.4%).

In terms of the achievement of sales targets, 4S stores that have been operating for more than 5 years, for which they achieve a 70%-80% sales target, are “very easily accomplished” and achieve a 90%-100% sales target.” It is very easy to complete." For 4S stores that are operating for less than 3 years, achieving a 40% sales target is a "difficult" task.

Taking Guangzhou as an example, of the 16 FAW Toyota dealers, whether it is sales or profits, GPG is the top spot. It is the first 4S shop that FAW Toyota established in Guangzhou. Looking back at Dongfeng Honda, Hengtongda Store, which has just celebrated its 6th anniversary, has been ranked first in sales of Guangzhou Dongfeng Honda Single Shop, and it also shows the operational strength of the old store “Ginger is still hot”.

Grouped and medium-sized scales have more "suction of gold"

Just after New Year's Day, although the annual car sales data for 2010 has not yet been announced, the industry is expected to surpass 18 million. Even Toyota, which was affected by the recall earlier this year, its two joint ventures in China, FAW Toyota and GAC Toyota, have stated that they will exceed their established sales targets. Shanghai Volkswagen also announced on December 26 last year that it had high-profile announcements that its production and sales in 2010 had both exceeded the one million mark.

The achievement of the production and sales targets of the manufacturers is also accomplished by the cooperation of three or five hundred distributors of their respective companies. According to the survey, 45.36% of car dealers stated that they could complete the sales tasks set by the manufacturers in 2010. 34.7% of dealers thought that “there was a certain degree of difficulty” and 19.7% of dealers considered it “difficult to finish”.

The scale effect of “cluster” is also reflected in the sales of automobiles. The sales target of the dealerships affiliated with the dealer group is better than that of the non-group dealers, such as the percentage of “basically able to complete” the 2010 sales target, the former (4 0 %) is significantly higher than the latter (30.4%). In response, a person in charge of the Guangwu Group told the reporter that a group of single stores tends to have more advantages in achieving sales targets, such as strong ability to lay out outlets and terminal prices are better than single stores. The group's most-branded system, which was implemented in mid-2010, was regulated by special personnel. On the other hand, it also saved costs and ensured profits.

More and more 4S stores are flaunted by their scale. The survey results from the China Automobile Dealers Association may cause frustration for the big 4S stores. The above survey shows that large-scale dealers have not achieved sales goals and reached an ideal, but rather the situation of medium-sized dealers is most optimistic.

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Dealer listing "is awesome"

Sales of more than 18 million vehicles were achieved by first-line car dealers. According to Luo Lei, deputy secretary-general of the China Automobile Dealers Association, the number of new car dealers nationwide in 2010 was 14,000. Since the implementation of the vehicle brand management filing system in 2005, the State Administration for Industry and Commerce has already reviewed and filed 63,000 branded car dealerships. He disclosed that "for many reasons, the number of dealers actually operating in the country should be 55,000."

In view of this, last year, the number of dealers in the automobile circulation sector increased by 25.45%. With the entry of so many investors, it is obvious that the prospects for the automobile circulation industry are bright and investors are favored.

On the other hand, several car dealership groups entered the capital market one after another in 2010, which also increased the competitiveness of the dealer group. The use of automobile industry analyst Sun Shiqing said, “The valuation of the automobile circulation industry is gradually emerging.”

On March 26 last year, Dalian Zhongsheng listed in Hong Kong, sounding the clarion call of the auto dealers group to enter the capital market. Zhongsheng Holdings issued a total of 280 million shares and closed at HK$10.72 on its first day of operation. Its operating income for the first half of the year was RMB8.8 billion, a year-on-year increase of 66%. On September 29, 2010, it invested RMB1.1 billion to acquire 50% of the shares of PDB. The company's product line extends to the high end and has expanded to more than 100 by the end of last year.

On November 19 last year, Liantuo Group submitted a listing application to the US SEC. The company plans to list on the New York Stock Exchange under the symbol "LAS" and wants to raise US$115 million. The underwriters are Cowen & Com pany and HSBC. It covers nearly 10 auto 4S shops in Beijing, including Audi, Toyota, Volkswagen, and Mazda, as well as a car rental company and advertising company.

On December 24 last year, Dingsheng Tiangong (600335) shareholders meeting approved the company’s major asset restructuring proposal—Dingsheng Tiangong will replace all its assets and liabilities by placing it under the control of China National Machinery Industry Corporation. Into the auto trade 100% stake, with the auto business core business of the China Import and Export Auto Trade backdoor listing, only in the first half of 2010, the income of China Import and Export Automobiles has reached 13.9 billion yuan.

Recently, China Zhengtong Automobile Service Holding Company (01728) announced that the stable price period for the global offering ended on January 1, 2011. As the second mainland China-listed car dealer Zhengtong Automobile, it was formally listed on the Hong Kong Stock Exchange on December 10, 2010 and was priced at HK$7.3. Also a financial tycoon, Buffett chose BYD to invest in the Chinese auto industry, and George Soros got involved in the promising Chinese auto industry by car dealers. A fund managed by Soros has invested $50 million in Zhengtong Automotive.

In the eyes of the industry, Soros gets a return that is not inferior to Buffett. Zhengtong Automobile, headquartered in Beijing and headquartered in Beijing, is the second-largest automobile dealership in China. It is a strong car dealer who wants to take the luxury brand sales route. Performance in the stock market is also good.

In South China, Guangwu Group, Nanling Group, and Hongyue Group have been the dealer groups most likely to be listed in the industry. They are accustomed to South China distributors who stunned their wealth. At present, there is no one who has publicly stated that it has a listing plan. However, according to insiders, the listing is included in the development goals of many dealer groups in the next 3-5 years. In the near future, some dealership groups have accelerated their expansion. It can be seen that increasing the number of new stores and mergers and acquisitions of old stores is being done on a large scale, and the premise of listing financing is just the expansion of scale.

At the end of November last year, the huge automaker forecasted that it would realize a turnover of 100 billion yuan in the year, which also means that the automobile distribution industry will have 100 billion yuan of monomer. The potential of the auto industry in the future will be very "powerful" for the distributor group.