On April 3rd, reports from domestic media reveal that with the introduction of Xiaomi's SU7, competition in the domestic automotive market has intensified.
While the arrival of Xiaomi's car has garnered widespread attention, it has also presented a challenge of "price wars" for traditional 4S dealership merchants.
According to a salesperson from a certain brand's 4S dealership, five years ago, they used to sell at least 300 cars per month. However, nowadays, they struggle to surpass 100 cars per month, with some days passing without any transactions.
In the face of supply-demand imbalances, the relentless "price wars" have severely impacted dealers' profits. "Selling cars is no longer profitable; it relies on subsidies from the manufacturers to sustain the business," said one salesperson.
Another salesperson from a self-owned brand's 4S dealership revealed that over the past year, the store's sales profits have almost entirely depended on manufacturer rebates.
According to the prevailing commercial policies of most manufacturers, dealers receive a basic rebate of around 5% of the car price. For instance, on a car priced at 200,000 CNY, the rebate is about 10,000 CNY.
However, under the influence of "price wars," some dealers have had to reduce selling prices, even lowering them to 190,000 CNY or less.
A dealer representing a brand of new energy vehicles also commented, "New energy vehicle brands operate under a sales agency system. Although there is no pressure to hold inventory, we can't make profits like before by earning the 'buying and selling price difference.' For each car sold, we only receive a sales service fee of 2% to 3% of the new car's selling price from the manufacturer, which is half of what it was ten years ago."
