Jilin traditional label manufacturer supply chain

An COVID-19 epidemic has brought the automobile manufacturing industry, whose annual income exceeds $8 trillion, to a halt.

The automobile industry, which has been declining for two consecutive years, is once again facing a major test.

At the beginning of June 5438+ 10 in 2020, almost all forecasting institutions were cautiously optimistic about the forecast of China automobile market this year. Although the automobile industry is experiencing an unprecedented initial stage of great change, it has lost the general pessimism from May 438 to the beginning of June 2009. But no one can imagine that a sudden epidemic has pressed the pause button for the entire automobile industry.

During the Spring Festival, everyone should be most concerned about: How much impact will the novel coronavirus epidemic have on the entire automobile industry?

How big is the automobile manufacturing industry in China? In 20 18, the overall income of the automobile manufacturing industry was 8,337.26 billion, accounting for about 9% of the national GDP of 910.9 trillion. Every "shutdown" day means about 22 billion economic losses.

The impact of the epidemic on various automobile manufacturers is not the same. The influence of car companies on the epidemic situation and their coping strategies are different under different circumstances. For some excellent automobile manufacturers, if they have made enough adjustments in the past few years, strengthened their own strength, such as establishing an optimization system of supply, R&D, manufacturing, marketing and after-sales, and successfully survived a series of "grey rhinoceros" incidents such as the switching of national VI standards, the decline of new energy subsidies and the evolution of consumption structure, then the current "black swan" epidemic, even if it has a great impact, is not fatal.

However, for most automobile manufacturers, at least 20 days of "shutdown" may amplify many internal problems covered by inertia and have unexpected effects. The seriousness of these internal problems may be far greater than the external epidemic challenges. Internal problems have been dealt with, and external risks and pressures are controllable and surmountable. On the contrary, if the internal problems are not handled well at this time, the ability to overcome external difficulties will also be greatly affected.

This means that every automobile manufacturer's self-assessment of the impact of the epidemic has become very important and urgent.

Tong Jiren commented that according to the duration of the epidemic, the impact may be divided into three stages: short-term impact on new car consumption, medium-term impact on supply chain coordination, and long-term impact on users' purchasing power.

Influence of epidemic situation on supply and demand of automobile market

1.？ Supply side: short-term balance of simultaneous freezing of supply and demand

In 2020, the automobile market ushered in a good start. 18 10 months ago, the wholesale volume of domestic passenger cars increased by 4.59% and the retail volume increased by 10.8 1%. Since the Spring Festival holiday is located in the last week of June 5438+ 10, if the construction period is delayed due to non-epidemic reasons, there should be a complete working month in February. However, as major car companies delay the start-up time to at least February 10, it means that nearly half of the car production capacity will be lost in the whole month.

Taking the automobile production during the Spring Festival in recent five years as a reference, the Spring Festival of 20 15, 20 18 and 20 19 are all in early February, which has the greatest impact on the whole month's production. The car output in February of these three years is about 60% of that in June and March. Therefore, based on the output in the same period of 20 19, it is estimated that the domestic automobile output will decrease by about 30% in the first two months of 2020.

Hubei Province, which suffered the worst epidemic, is the fourth largest provincial-level automobile production area after Guangdong Province, Jilin Province and Shanghai, accounting for 8.7% of the national automobile production in 20 19. If the start of automobile factories in Hubei and other areas with serious epidemic continues to be delayed, it will further affect the annual automobile output.

For dealers, a key word of 20 19 auto market is "destocking". By 20 19 12, the inventory of the automobile market had dropped to the lowest 1.33. Classified, the inventory coefficients of luxury/imported brands, joint venture brands and local brands after 65438+ in February last year are 1. 1 1.18,1.6/kloc-respectively. In other words, according to the normal sales rhythm, the inventory of general dealers can be maintained within 2 months, and some Japanese car companies with lower inventory may be within 1 month.

However, considering the superimposed suppression of consumer demand by the Spring Festival holiday and epidemic, except for some popular models that are already in short supply, dealer inventory is enough to support most of the current consumer demand. As long as most car companies can resume normal production from March, there will be no imbalance between supply and demand in the market.

2.？ Consumer side: there is great uncertainty in the first purchase and consumption below the third line.

At present, the most uncertain factor is on the consumer side, and the core is purchasing power.

Compared with 2003 during the SARS period, the domestic economic structure has undergone great changes. An obvious feature is that the proportion of the tertiary industry in the national economy has increased from less than 1/3 in 2003 to more than half of that in 20 18. The number of employees in the tertiary industry accounts for 46.3% of the total employment, exceeding 360 million. This epidemic, which occurred during the Spring Festival, has the most obvious impact on the tertiary industry such as catering, entertainment, tourism and retail, and will directly affect the income and consumption expectations of all employees.

After SARS in 2003, the rapid increase in demand for private cars and the stimulation of the epidemic on the desire for private cars contributed to the explosive growth of the automobile market that year. However, in 2020, when the repurchase is basically the same as the first purchase, or even when the repurchase exceeds the first purchase, this stimulus will mainly appear in the cities below the third line with a high proportion of the first purchase, and it will have little impact on the first-and second-tier cities that mainly increase/exchange purchases, and the cities below the third line are precisely the areas whose economies are most affected by the epidemic. When these two stages cancel each other out, it is more likely that consumer demand will decline in the short to medium term.

Based on the retail volume in the same period of 20 19, according to the current epidemic situation and neutral expectation, the retail volume of automobiles in the first quarter of 2020 may decrease by about 30% year-on-year.

The deep-seated impact of the epidemic on the whole industry

In addition to affecting the market supply and demand in the first quarter, the persistence of the epidemic will also have a chain effect on the marketing, supply chain and cash flow of the automobile industry.

1.？ Marketing: the launch of new cars is disturbed, and stabilizing dealers is the key.

If the epidemic lasts for a long time and affects the auto market in the second quarter, the new product launch plans of most auto companies in the first half of the year may be seriously affected, including the delay in the launch time of new models. After the epidemic, consumers' new demands for product body shape and healthy configuration will also have an impact on the definition and positioning of new cars. At the same time, if there is still no downward turning point in the epidemic in late February, the Beijing Auto Show in April may also face the risk of postponement or even cancellation, which will undoubtedly directly affect the pace of new car listing throughout the year.

All marketing activities and behaviors, especially the original plans around new cars and terminal channels, may increase uncertainty because of the persistence of the epidemic. At present, it is imperative for car companies to adjust the pace of new car launch in a timely manner according to the development and changes of the epidemic situation, and on this basis, adjust all relevant time nodes involving new products to minimize the extra losses caused by the disconnection between R&D, production, promotion and sales.

On the other hand, it is also very important to maintain the stability of dealers' operating conditions and cash flow, especially in areas with serious epidemics, which is one of the top priorities of major car companies. Faced with the uncertainty of consumer demand and the sharp drop of passenger flow, dealers who are already short of funds not only need sufficient decompression support from manufacturers, but also need opportunities to improve their online marketing and customized service capabilities. In fact, whether there is an epidemic or not, these are the continuation of the switch between old and new kinetic energy at the marketing level.

2.？ Supply chain: short-term impact spreads to global markets

China manufacturing has become an important part of the global auto parts system. Compared with the shutdown of the whole domestic automobile industry chain, the short-term shutdown affected by the epidemic has affected the stability of parts supply in the global automobile market.

However, there is a precedent for this situation. Global auto giants are also looking for short-term alternatives and solutions to reduce the risk of downtime caused by parts supply.

20 1 1 Japan's "3. 1" earthquake exposed the potential risks of the "zero inventory" management mode generally praised by Japanese car companies under certain circumstances. At that time, car companies that implemented zero inventory often established long-term and stable cooperative relations with only one supplier on some key parts. The closed supply chain correspondingly weakens the ability to resist emergencies, and the fracture of a certain link will affect the whole supply chain.

However, it is precisely because of the experience of dealing with emergencies many times in recent years that even the zero-inventory management model has corresponding emergency prevention and recovery mechanisms, such as national multi-point production, multi-track supplier system and partial zero-inventory management, in order to ensure the balance between business continuity and production efficiency. Considering that the supply and demand in the terminal market are temporarily frozen, if the epidemic situation can be effectively controlled in the first quarter, the supply chain in the domestic automobile manufacturing field is expected to resume normal operation steadily in the second quarter.

3.？ Cash flow: the new force of making cars will be robbed again

If the worst-case scenario is considered, such as the decline of new car sales by 25% or more in the first quarter of 2020, can the cash flow of China car companies withstand such pressure?

For those traditional automobile manufacturers who have developed steadily and survived the decline of 20 19 automobile market, the cash flow problem in about half a year is not big. However, for the new car-making forces that still rely on investment and financing to survive, especially those that are expected to achieve mass production and delivery in 2020, Tesla far exceeds the expected domestic delivery capacity, and the pressure of lockout and delay brought about by this year's epidemic will make many new car-making forces suffer again.

This also means that 2020 will be a year of "life and death" for most new car-making forces. Only when mass production is delivered, the new forces of building cars generate cash flow and have heavy assets will the financing structure of the capital market undergo fundamental changes. Before that, is there enough money to survive? Achieve mass production sales and capital withdrawal? Every link is closely related to cash flow, and the interruption of any link will make a new car-making force disappear. This wave of new energy vehicles that have been going on for five or six years will usher in a real "decisive battle" in 2020. Game) "

The epidemic just changed the rhythm, not the direction.

Perhaps the entire automobile industry will not return to a normal and stable state until the third quarter of this year, but the trend of "steady growth" of the overall economy will not change because of the epidemic. After the epidemic is lifted, the corresponding policies to ensure "steady growth" will also be strengthened. The automobile industry, which accounts for 9% of domestic GDP, is bound to be one of the priority beneficiaries.

Some people have calculated the losses and impacts, so they can give you some reference: in 20 17, Shanghai calculated the economic losses of Shanghai automobile manufacturing industry according to the data of the third economic census in 20 13. The calculation results show that when the enterprise stopped production for 46 days, the total production loss and industry-related losses were 65.438+046.04 billion yuan, accounting for 6.8% of Shanghai's GDP in that year. Simply put, the impact of the suspension of Shanghai's automobile industry on the total GDP is about 0. 15 percentage points per day.

If the scope is extended to the whole country, the impact of short-term suspension of production in the automobile industry on the economy will be further diluted. At present, the general suspension of production for 65,438+00-65,438+05 days will not affect the new pattern of automobiles in China, and most automobile manufacturers have enough production capacity to make up for the lost production figures in a short time.

Tong Jiren commented that for most domestic auto companies, it is far more important to adhere to the adjusted direction, accelerate the completion of internal changes and strengthen the competitive advantage of products and systems than to deal with external emergencies. Compared with the changes in consumption expectation and purchasing power caused by the current epidemic, the "shutdown" loss can be ignored. Once the epidemic situation is alleviated, with the help of policies, with the gradual recovery of consumption expectations and purchasing power, China auto market will still accelerate its adjustment along the previous market inertia.

What the epidemic can change is only the current development rhythm of the automobile market, not the future development direction of the automobile market. Practitioners should be more confident to see more business opportunities and new challenges brought about by the great changes in the automobile industry in the next decade.

This article comes from car home, the author of the car manufacturer, and does not represent car home's position.