With the opening and operation of the Chengmianle Line, a one-hour traffic circle centered on Chengdu will be formed, which will greatly facilitate passengers' travel and achieve “living with the city”. The high-speed rails will also drive a huge flow of people. The emergence of a large number of one-hour and a half-hour economic cycles will greatly stimulate the new round of vigorous development of various industries along the line, and the second and third-line automobile markets on this line. It will also usher in a new round of opportunities and challenges.

The emergence of the second and third tier markets

In recent years, China's auto industry has experienced an explosive growth phase, which has also made China the world's largest auto industry market. Today's cars are no longer a luxury for Chinese consumers. Many ordinary families have become car owners, and they have gradually turned to two or even three car purchases. With the rapid growth of automobile consumption, the inventory of the automobile consumer market in the first-tier central cities began to saturate, and a new round of blowouts will gradually tilt toward the second-tier and third-tier markets.

The data shows that the growth rate of sales of passenger cars in the domestic first-line automobile market was only 8.1%, while the growth rate of the second and third-tier markets reached 27.6% and 33.7% respectively. In 2014, the 10% growth in China's auto market is being released from the provincial capital and the provincial center cities to the second, third and even fourth- and fifth-tier cities. Taking Guangdong, the main market for Chinese automobile consumption, as an example, Shantou, as a typical second and third tier market, currently has about 30,000 vehicles on board each year, and the growth rate in 2010 is as high as 60%. In the first half of 2011, it reached 20%, and continues to lead. Provincial cities.

From 2005 to 2008, the market share of the third and fourth lines increased from 34.8% to 41.5%. In recent years, the share of the second and third-tier markets has continued to rise rapidly. According to industry insiders, this fully demonstrates that the growth of China's future auto market will be determined by the second and third-tier markets. ”

With the promotion of the “urbanization” strategy of the country, a large amount of funds from the government and the private sector has flooded into the second and third cities. This has led to a marked increase in the consumption level of this part of the market and a continuous increase in consumer demand. In addition, the original conditions for urban construction have been limited. The rapid development of the highway network has significantly improved the car environment. In addition, China still has more than 85% of the population still concentrated in the second and third tier cities. The increase in income, improvement of the traffic environment, and concentration of population have led to the release of car demand naturally. Zhang Zhiyong, an auto industry observer, predicts that “the automobile market will enter a new round of growth cycle due to the new policy of urbanization.”

Car companies sink sinking channels

Since 2009, under the encouragement of a series of automobile consumption encouragement policies, the “gold mine” to be dug in the Chinese automobile market in the second and third tier markets has begun to erupt. This not only strongly supports the rapid growth of the auto market for two consecutive years, but also gives a farsighted view and advance layout. The company has provided generous returns.

With the rise of the second and third tier markets, various car companies have invariably shifted the development center, opening up the network layout strategy of channel sinking in order to increase sales and expand market share. From the current point of view, under the conditions that both consumption habits and spending power have been initially met, the space available for the development of the second and third tier markets is still very large. These regions play a role in connecting cities and villages, so their spending power is often more than a single city but the entire region. The development of second- and third-tier cities will not only make the auto market more balanced, but it will also be able to get closer to the already existing huge market and benefit from direct contact with consumers.

At present, from luxury car brands BMW, Audi, to joint venture brands Dongfeng Nissan, Guangzhou Automobile Honda, to their own brands Geely, Chery, etc., are strongly promoting channel sinking. In the just-concluded Guangzhou Auto Show, there are also a number of car owners said that will accelerate the sales channel sink. Changan Ford revealed that as of the end of this year, the number of distributors in the country will reach 800, of which 75% will be located in the fourth, fifth and even sixth-tier cities. Dongfeng Citroen's outlets have so far reached 83% coverage in prefecture-level markets, and county-level market coverage has reached 85%.

Innovation terminal form will become a trend

In fact, the channel sinking trend of car companies started as early as 2011 when China's auto market entered a period of micro-growth. The slowdown in the growth rate of first-tier cities forced car dealers to gradually shift their focus to the second and third-tier markets. After experiencing price wars and product wars, the competition for channels has intensified, and diversified forms of terminals will help companies quickly capture the market.

Last year, Dongfeng Nissan took the lead in launching the “Elite Strategy for Creating Wealth,” and to attract and support social elites to jointly develop and expand the third- and fourth-tier markets with profound potential, and to occupy the market's highs and opportunities with a leading-edge strategy. Effectively solve the channel sinking, three or four line marketing dilemma to try. In the future, Dongfeng Nissan will also have a series of measures to strengthen its competitiveness in the third- and fourth-tier markets and win the initiative in the "blue ocean market" and competition in the next decade.

In addition to joint venture brands fighting in the channel wars, many luxury car companies also aimed at the second and third line market this huge cake. The first VRE store in Volvo's western region was officially completed in Mianyang in October this year; BMW also stated that it will adopt a variety of outlet types in the future, not only 4S stores, 5S stores, but also city maintenance centers, striving to further channels Sinking to the fourth and fifth-tier cities; Bo Shi, general manager of FAW-Volkswagen Audi Sales Division, also revealed that there are many different types of Audi brand dealer stores in the future.

In addition, while Mercedes-Benz is accelerating its network construction in China, it also plans to fill the current network gap through the construction of maintenance outlets and service outlets. Lexus's mini 4S stores in the third and fourth tier markets will continue to be sales-oriented, with fast repair capabilities, and its new network will also focus on the development of fourth- and fifth-tier cities, and even six-tier cities.

Independent brands will face challenges

As both joint venture brands and luxury brands continue to vigorously promote downward attack, they have been suppressed from the second, third and fourth lines to the 456 line and have intruded into the advantage space of independent brands. The independent brands will face enormous pressure. Although self-owned brands have been striving to improve product quality at the technical level and improve service quality at the sales and after-sale level in recent years, the weakness in brand power is still an indisputable fact. For consumers, it is self-evident to choose an independent brand or a joint venture brand under the same price.

At present, the focus of self-owned brand hot models is still concentrated in the 50,000 to 100,000 yuan range, such as Chery's product line, QQ, FY-2 and other products are still the main sales force; in the BYD product camp, F3, F0 two The cumulative sales of models accounted for more than 30% of the brand's overall sales. In this price range, the entry of Volkswagen Santana, Jetta and other entry-level products will gradually blur the separation of self-owned and joint-venture 100,000 yuan, and the competitiveness of such hot models as the Ford Fiesta, Skoda Hao Rui, and Shanghai Volkswagen POLO also occupy a clear position. Advantage. Today, the joint-venture brand has further invaded its own price territory of around 50,000 yuan. The pressure on independent brands cannot be underestimated.

However, we also see that independent brands represented by Geely and BYD are also undergoing transformation in order to seek breakthroughs in quality and technology. In the future, if the independent brands want to be evenly matched in the fourth- and fifth-tier markets and joint-venture brands, they must work hard at the brand's upward direction and from many aspects such as products and channels.