· China's auto market growth slows down

Beijing time on the morning of November 4th news, the media comprehensive article on Monday pointed out that the slowdown of the Chinese auto market is not good news for any car brand, but for Japanese car dealers, this seems to be a particularly serious problem.
Dongfeng Motor Co., which has joint ventures with Nissan, Honda and Peugeot Citroen in China, reported on Monday that net profit in the third quarter fell 16% from the same period last year. The income from these joint ventures was 1.1%. Decline. Dongfeng Motor's shares listed in Hong Kong, the price immediately fell 4%.
The Sanford-Bernstein study report pointed out that considering the 8% growth of China's auto sales in the previous quarter, far below the 16% growth rate in the same period last year, the decline in Dongfeng Motor's profit is understandable. However, Dongfeng Motor’s financial report showed that sales volume with Japanese joint ventures actually declined during the quarter – Dongfeng Nissan’s sales decreased by 14%, Dongfeng Honda’s sales decreased by 34%, and Dongfeng Peugeot Citroen’s performance was better.
This unfavorable performance is not even limited to Dongfeng Motor. Guangzhou Auto, which is also listed in Hong Kong, has cooperation with Toyota, Honda and Fiat. The company also said last week that the joint venture revenue in the third quarter fell by 30% year-on-year.
Some analysts pointed out that some Japanese brands have wrong estimates of the Chinese market. Honda set an ambitious sales target for China and sent its distributors a product that is much higher than the actual sales capacity. The company was forced to lower its sales target last week. In addition, Honda's products look older, and if you consider the discount rate that dealers are willing to give, pricing is sometimes high. Similarly, Nissan also sent too many cars to dealers, causing a lot of inventory.
In addition, Japanese brands also have a broader image problem. In a consumer survey conducted in Bernstein, 51% of the 40,000 respondents said they would not consider buying a Japanese car. Macquarie's data shows that after the 2012 event, the Japanese brand as a whole recovered some market share, but lost another share in 2014. The main winners are a number of German car manufacturers and Ford.
Nomura Securities pointed out that in the fiscal year ending March, 24% of Nissan's global sales were in China, and Honda's ratio was 18%. Toyota's Chinese market is relatively low, only 9%, and its performance in the Chinese market has been relatively better since 2014.
The lower the enthusiasm of Chinese consumers for cars, the more critical they are for car dealers and products. Chinese domestic brands have already lost in this competition, and Japanese car dealers seem to be the next batch of victims.

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