China Automobile Dealers Association: The comprehensive inventory coefficient of automobile dealers in December was 1.14, a year-on-year decrease of 5.0%.

On January 10, the China Automobile Dealers Association released the results of the "Car Dealer Inventory" survey for December 2024: the comprehensive inventory coefficient for car dealers in December was 1.14, an increase of 2.7% compared to the previous month, and a decrease of 5.0% compared to the same period last year. The inventory level is below the warning line but within a reasonable range. I. Decrease in inventory coefficient compared to last year and increase compared to the previous month The current round of scrappage updates and trade-in policies ended at the end of December. The effectiveness of the 2024 passenger car scrappage/replacement update policy was significant, with over 2.9 million cars scrapped and over 3.7 million cars replaced. Major car companies are making a final push for annual sales, and with the push of the pre-Spring Festival car buying spree, market demand for cars has been stimulated early. Due to some models being in short supply before the end of the year and a longer delivery period, as well as uncertainty about the 2025 scrappage updates and trade-in policies, some consumers are temporarily cautious. Therefore, the December car market sales volume was lower than expected, and inventory levels slightly rose. It is estimated that the terminal sales of passenger cars in December will be around 2.85 million, resulting in a total inventory of around 3.25 million cars by the end of December. It is expected that dealers will increase their efforts to reduce inventory in January, with no strong intention to replenish inventory. II. Decrease in inventory coefficient for high-end luxury and imported brands, joint ventures, and an increase for domestic brands The inventory coefficient for high-end luxury & imported brands was 1.10, a decrease of 8.3% compared to the previous month; joint venture brands had an inventory coefficient of 1.05, a decrease of 4.5%; and domestic brands had an inventory coefficient of 1.21, an increase of 13.1%. III. Brands with the highest inventory depth in December At the end of December, the inventory coefficient for mainstream brands was generally less than 2 months, so high inventory brands are not listed this month. IV. Cautiously anticipate market demand for January 2025 and control inventory reasonably Due to the Chinese New Year period in January, there will be fewer working days, and most consumers will be returning home or traveling for vacation, and the pre-holiday car buying demand has already been partially released in December. It is estimated that car sales in January will show a significant seasonal decrease compared to December of the previous year. In terms of policies, on January 8th, the National Development and Reform Commission and the Ministry of Finance issued a notice on the implementation of the "Large-scale Equipment Replacement and Consumer Trade-in Policy for 2025." The notice expanded support for car scrappage updates, including allowing fuel cars meeting National Emission Standard IV to qualify for scrappage subsidies, and further extending the age limit for new energy passenger cars eligible for scrappage updates by 8 months. The timely introduction of these guidelines for scrappage updates and trade-ins helps shorten the policy gap, improve consumer confidence in car purchases, and positively stimulate car consumption at the beginning of 2025. The China Automobile Dealers Association recommends that in the face of increased uncertainty in the future car market, dealers should make rational estimates of actual market demand based on the actual situation. At the same time, they should increase promotion of the "trade-in and scrappage update policies," enhance services to boost consumer confidence, prioritize cost reduction and efficiency improvement, and guard against operational risks.