Major listed companies in the second-hand car industry: Jingu Holdings (002488), Shanghai Wumao (600822), Great Eastern (600327)

The core data of this article: second-hand car transaction volume, second-hand Car-to-registration ratio, financial penetration of China’s second-hand cars

China’s second-hand car transactions are booming, and transactions are showing an upward trend

In recent years, my country’s second-hand car transactions have been active, and China’s second-hand car transaction volume has been It has continued to grow for 18 consecutive years, with the national transaction volume increasing from 370,000 vehicles to 14.923 million vehicles in 2019. However, due to the impact of the epidemic in 2020, China's second-hand car transaction volume declined for the first time. According to statistics from the China Passenger Car Market Information Federation, a total of 14.34 million second-hand cars were completed in my country in 2020, a cumulative year-on-year decrease of 3.91%. In the first half of 2021, a total of 8.4342 million second-hand cars were traded in my country, a year-on-year increase of 52.89%; even in the off-season of automobile industry sales in June, the transaction volume of second-hand cars still had a month-on-month growth of 4.43%.

The loosening of China’s second-hand car relocation policy is conducive to the development of the second-hand car market

Restricting the relocation of vehicles also inhibits the vitality of second-hand car consumption. In 2018, the government work report clearly called for the complete cancellation of the second-hand car relocation restriction policy, which was later reiterated through multiple documents. Various regions have responded one after another, and a unified national market for second-hand cars has gradually taken shape.

At the beginning of 2020, due to the dual impact of holidays and the epidemic, the second-hand car transfer rate reached its lowest point in February, only 14.86%. With the improvement of epidemic prevention and control and the continuous advancement of the resumption of work and production, cross-regional circulation has shown an overall slow growth trend since the second quarter, with six consecutive months from July to December better than the same period in 2019. The proportion of second-hand car transfers in December was 28.88%, setting a new high for the year. The proportion of transfers increased by 3.77 percentage points compared with the same period in 2019. The total number of second-hand car transfers in 2020 was 3.938 million, and the transfer ratio was 27.46%, a decrease of 0.41 percentage points compared with the same period in 2019.

China’s second-hand car financial penetration is lower than that of the United States, reflecting that my country has greater room for growth

In the context of consumption upgrading, second-hand car transactions are growing rapidly, and second-hand car finance is also ready to take off. Comparing the second-hand car financial penetration rate (number of loan orders/total car sales) between my country and the United States in 2019, it can be seen that my country’s second-hand car financial penetration rate is far lower than that of developed countries. my country’s penetration rate is only 29%, while the United States is in In 2015 it was already 54%.

Note: Second-hand car financial penetration = number of loan orders/total sales of second-hand cars

my country’s second-hand car finance has begun to enter the stage of standardized development. Looking to the future, under the new "dual circulation" pattern of China's economy and the new development requirements of the "14th Five-Year Plan", the automobile circulation industry with second-hand cars as the core will have important strategic significance as a key area to stabilize growth and expand domestic demand. Therefore, the "2021 China Second-hand Car Finance and Ecology Report" mentioned that in 2020, my country's second-hand car financial penetration rate will reach about 30%, and it is expected to reach about 48% in 2025. According to the forecast of Frost & Sullivan, an analysis agency, as the proportion of second-hand car consumption in total automobile consumption increases, the scale of China's second-hand car finance market is expected to reach 704.3 billion yuan by 2030.

China's second-hand car trading market has good development prospects, attracting players from all walks of life

As my country's second-hand car trading volume increases year by year, the enthusiasm of mass consumers continues to rise and the policies are favorable. Thanks to the promotion, my country's second-hand car financial market has huge room for imagination, leading to the influx of a large number of players. Players in today's used car financial market are mainly divided into five categories: banking institutions represented by Ping An Bank and Industrial and Commercial Bank of China; OEM financial companies represented by SAIC General Motors Finance and BMW Auto Finance; and credit guarantee companies represented by Zhejiang Anxin The company; financial leasing companies represented by Pioneer Taimeng, Jianyuan Capital, and Fengbang Leasing; Internet car trading platforms dominated by Dasouche, Cangu, and Guazi used cars.

In addition, with the development of the second-hand car financial market, a number of second-hand car testing and evaluation institutions, represented by Che300, have emerged.

The above data refers to the "Market Demand Insight Report of China's Used Car Industry" by the Qianzhan Industry Research Institute.