Since the official implementation of the “Automotive Finance Company Management Measures†in August 2004, China’s auto finance market has grown by nearly 300% in the past 10 years, but the penetration rate of auto credit has only 17%.
On the one hand, the car sales and demand have developed substantially, on the other hand, it is the fatigue of auto finance development.
Sun Tianhong, a banker of the China Banking Association, said in an interview with Zhongxin.com that auto dealers and banks have begun to attach importance to the combination of auto and finance; consumer hotspots and emotional changes; the development trend of Internet finance. Will support the better development of the automotive financial market. Many factors cater to the development of the automotive financial market, and the market potential is huge.
Car marriage, financial market, China has a promising future
Auto finance services refer to financial activities that integrate funds in the production, circulation and consumption of automobiles, including fund raising, credit utilization, mortgage discounting, securities issuance and trading, and insurance and investment activities. They are mutually infiltrated between the automobile industry and the financial industry. The inevitable result.
According to the reporter's understanding, the main auto financial institutions in China are now auto finance companies. There are 19 domestic companies, and 17 foreign companies include Ford, Volkswagen, General Motors and other old auto finance companies and local BYD and Great Wall Binyin Auto Finance Co. Geely Auto Finance is awaiting approval; there is also the financial services provided by banks and the auto financing services such as online car mortgages and financial leasing that accompany the rise of Internet finance.
Since the beginning of the 21st century, China's automobile sales have developed spurt. Since the official implementation of the "Automotive Finance Company Management Measures" in August 2004, domestic automobile sales market has grown by nearly 300% in the past 10 years.
But at the same time, according to Ford Asia Pacific's 2014 research data, the penetration rate of auto credit in the Asia-Pacific region is over 80% in the US, 70% in India, 50% in Brazil, 30% in Russia, and 17% in China. (Automotive credit penetration refers to the proportion of total cars purchased through credit to the total sales of automobiles.)
The car home survey data also shows that 33.0% of consumers choose car loans to reduce economic pressure, 31.3% to make up for the lack of car purchases, and 25.7% to revitalize cash flow. Consumer loans to buy more cars to make up for the lack of car purchases and reduce economic pressure, and for the most important connotation of auto finance - revitalizing cash flow, Chinese consumer awareness is not high.
Sun Tianhong, a banker of the China Banking Association, said in an interview with Zhongxin.com that China’s auto sales and demand are huge. In recent years, the auto dealer’s profitability has declined and the profitability of the auto market has diversified. Under the influence of factors such as the financial services and profit model, and gradually taking into account this huge market; and the development of automobile and financial integration trends, China's auto finance has begun to develop rapidly, with great potential and great future.
According to the multi-party research report, China's auto finance has developed rapidly in recent years.
According to a survey by Shanghai General Motors Finance Co., only about 7-9% of auto sales in 2004 involved some loans, but in 2013 it has grown to 19%, and the number of loan purchases has increased. At the same time, consumer acceptance of car loans is also changing. In 2004, less than 50% of consumers were willing to consider borrowing car loans, and by 2013, this figure reached 75%.
At the same time, research shows that China's auto finance penetration rate has been rising over the past six years. In the luxury car segment, auto finance penetration rose from 8% in 2008 to 31% in 2014. Based on the continuous growth forecast of China's passenger car sales in the next few years, auto financial services institutions still have great market potential.
The data provided by Volkswagen Finance China also shows that before 2010, the Volkswagen Group's loan rate in China was around 10%. In 2013, this figure doubled to more than 20%. In 2013, Volkswagen Finance China provided financial services to 228,000 vehicles, and the number of new contracts increased by 52% year-on-year.
Sun Tianhong told the reporter of Chinanews.com that the wait-and-see mood in China's real estate market has caused many investors and consumers to start to change their consumption patterns, from buying a house to buying a car, and enjoying the mood of modern residents, and the personalized consumption of young people. The automobile consumer market will have a lot of room for development, and consumer sentiment will also cater to the development of auto finance. The auto finance market will have a good development market and space.
Various gold rushing Internet finances to enter China's autos, including the considerable size of used car stocks, have allowed financial companies, banks and emerging Internet finances to adjust their strategies and lay out auto finance.
According to the reporter, old-fashioned auto finance companies such as Ford, Volkswagen, and General Motors have used their own technology, capital, and customers to mature their financial service vehicles. In recent years, they have achieved great development in China. It has also continuously introduced new measures and used various new technologies and new methods to seize market share.
As above, GM Finance, with the support of relevant government departments and the cooperation of banks, using its big data drive to customers, can complete the entire credit process in 15 minutes; and launch customized automotive financial services for special people; In terms of sales channels, we not only use our own strong e-commerce, but also generate more customers through WeChat.
Rick Livingood, managing director of General Motors Finance, has publicly stated that it is a very good time to become an auto finance company in China at this moment, because consumers have access to credit in the past ten to twenty years. a huge change occured.
Sun Tianhong told the reporters of Zhongxin.com that auto finance companies are developing very well. They have resources, customers, experience, and strong sales and service networks. Their sales models and banks’ cross-selling models are different and better. Targeted and professional. China's domestic auto finance companies are relatively backward in development, but the existence of the entire market is bound to be objective in its later development. It also takes a certain amount of time and procedures for regulatory approval.
And such a huge market and consumer enthusiasm, as a traditional financial service provider - how can banks give up?
According to the reporter's understanding, China Construction Bank Longka Auto Card is the first lifestyle credit card in China that specializes in serving car owners. It is a service platform and payment settlement tool for car owners.
The relevant person in charge of CCB Zhejiang Branch told the reporter of Zhongxin.com that the Longka car card was first launched in Zhejiang Province on August 8, 2004. It is not only a unique identity symbol for the superior life and good credit of the owner, but also for each customer. Weekly car wash offers, points double oil change, national road rescue, fueling concessions and other rights. As of the end of August 2014, more than 600,000 copies have been issued in Zhejiang Province.
Banks such as CITIC, People's Livelihood, and Ping An have also laid out auto finance markets in recent years.
Sun Tianhong believes that the bank previously only knew a single 'bank-finance' single-service model, blindly relying on spreads to make money; neglecting other sources of profit. In this regard, banks should learn from dealers and develop their thinking. Now banks have also attached importance to the huge market of automobiles. The development of foreign auto finance markets has also allowed banks to change their business models and open up auto finance markets. â€
"Financial services support the development of automobiles, banks are big, but banks must first understand the automotive industry and need to develop the corresponding professionals. Banks have been doing this for more than 20 years, and now the service has improved. But the key is the problem of inclination, policy The willingness to support is largely determined by the development of this industry.†Fang Wei, president of the Zhejiang Automobile Association, said.
The development of Internet finance and mobile Internet finance has also inspired some “big brothers†to get involved in the auto finance market.
Tencent Li Caitong and FAW-Volkswagen Audi launched a cross-border cooperation with the brand and launched the cooperation of “Audi A3, Buying a car and managing moneyâ€. The user freezes 10,000 yuan of financial funds on the designated page of “Li Cai Tong†to make a deposit payment, breaking through the limitation of the customer deposit being frozen but no profit in the traditional car purchase mode.
Previously, Ali also launched a cross-border play mode between the car brand and the mobile Internet. For example, if it cooperated with multiple dealers to prepay the balance of the frozen treasure, the car purchase amount was frozen in the balance treasure for 3 months before it was released to the manufacturer. During the account period, you can enjoy the benefits of the purchase of the car for 3 months.
Sun Tianhong pointed out that the first level of Internet finance is that it is convenient and quick to build an information platform; the second level is risk control; the third level is configuration. Nowadays, the P2P platform is in a big wave, and many platforms do not have a systematic financial solution. However, after a certain period of time, auto finance will surely rely on Internet finance to achieve greater development.
"Only pursuing the maximization of self-interest will not work. Only by paying attention to profitability and mutual benefit, the whole market will maximize the benefits. The combination of automobile and internet finance will definitely form a universal effect." Sun Tianhong said To.
Zhejiang auto finance market to be developed According to the reporter, although auto finance has a big rise in China, compared with Shanghai, Beijing, Chengdu and other cities, Zhejiang's auto finance development is relatively lagging behind, but its potential is huge.
According to the statistics of Zhejiang Province's statistical information network line, in the first half of the year, Zhejiang auto enterprises achieved retail sales of 139.6 billion yuan, an increase of 11% over the same period of the previous year. In the first half of the year, automobile consumption boosted the total retail sales of consumer goods by 2 percentage points. Hangzhou City was affected by the “limit card†policy, and automobile consumption dropped significantly. In the first half of the year, the retail sales of automobiles reached 36.4 billion yuan, up 4.3%, Wenzhou increased by 9.9%; Zhoushan and Jinhua grew faster, up 24.9% and 21.4 respectively. %.
The reporter also visited several automobile 4S shops and car sales stores in Hangzhou. In the Huashi Benz 4S store to launch "value-for-money purchase" financial products, customers can extend the final choice of the tangible assets of the vehicle in the form of a lease after paying a certain amount of advance payment and deposit.
According to the sales staff in the store, in the more mature automobile market abroad, the value-added purchase is very common, but in China, Mercedes-Benz is the first to launch the financial product. However, sales have not been optimistic since the launch of the product.
Sales staff said that on the one hand, it may be because the owners of luxury cars have more cash; on the other hand, according to their own understanding, many domestic customers are not familiar with auto finance, and unfamiliarity is the reason for their neglect of auto finance services.
In the FAW Volkswagen Hangzhou Tianmushan car outlet store, the sales director told reporters that although the use of loans to buy a car is a repayment of installments, but the overall cost may be more expensive than the whole car purchase. Some younger 90s or office workers who are just going to work will consider car loans to buy cars, but the overall size has not yet reached the number.
Fang Wei, president of Zhejiang Automobile Industry Association, said in an interview with Zhongxin.com that Zhejiang's automobile industry has a relatively high status in the country, especially the production of parts and components. Hangzhou's financial support, financial services support, brand introduction and talent retention have contributed to the development of the automotive industry, but the overall scale is still insufficient compared with Shanghai, Guangzhou and Chengdu.
Fang Wei also pointed out that the overall aspect of auto finance services in Zhejiang Province is still not very good. The main reason is that the layout of auto finance companies is not settled. Banks support auto finance. CCB is the first to do, ICBC, China Merchants Bank, etc. It is also doing, and the upcoming establishment of Geely Auto Finance Co., Ltd. and the placement of Volkswagen in Hangzhou next year will bring improvements to the overall construction of Zhejiang Auto Finance.
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