The profit margin of China's automobile industry is stable at around 5%, and the implementation of National VIB standards has had a positive impact on the overall situation

Recently, the latest data that has attracted widespread attention shows that there have been some significant changes in the current situation of China's automobile industry. Information released by Cui Dongshu, secretary-general of the Passenger Car Association, points out this point

In the first seven months of this year, the total revenue of China's automobile industry reached 5.3148 billion yuan, an increase of 12% compared with the same period last year. However, this growth was also accompanied by rising costs, which increased by 12% year-on-year to 4,637.8 billion yuan. At the same time, although the profit amounted to 258.3 billion yuan, it only increased by 1% year-on-year, and the profit margin continued to decline, currently only 4.9%. It is worth mentioning that this profit margin is still low compared to the average level of 5.4% for the entire industrial enterprise

According to the editor’s understanding, in July 2023, The GDP of China's automobile industry reached 821.7 billion yuan, a year-on-year increase of 5%. However, costs also increased, up 5% year-on-year to 714.9 billion yuan. Despite the increase in production, profits have declined significantly, down 30% year-on-year to 40.7 billion yuan. This resulted in the automobile industry's profit margin remaining at only about 5.0% this month. Cui Dongshu pointed out that although the automobile industry's production and sales under a high base are still performing relatively well, the profit margin of fuel vehicles is shrinking rapidly. Although new energy vehicles are growing rapidly, they are facing huge loss challenges, which has brought huge pressure to the industry. In addition, the National VIB standards that will be fully implemented in the first half of 2023 have also put a certain amount of pressure on the production of car companies. In order to solve the inventory problem, they have to take production reduction measures, but this also leads to greater profit losses. However, after the implementation of National VIB standards, the central government and governments at all levels have taken measures to stabilize market consumption and automobile production, making the overall situation expected to stabilize and improve

Over the past two years, the commercial vehicle market has performed well, while the passenger vehicle market has been relatively weak. By 2021, China's automobile production will reach 26.53 million vehicles. The problem of unfavorable consumption structure has further intensified, and the production growth rate of sedans is low, lower than the average growth rate of overall automobile production. The growth rate of SUV production is also lower than the growth rate of overall automobile production, which has become a factor restricting consumption.

China's automobile industry has achieved positive results in some areas, but it still faces problems such as declining profit margins. In order to achieve sustainable development, all parties in the industry need to work together

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