China’s Vehicle Inventory Alert Index surges to 81.2% in Feb.

Shanghai (Gasgoo)- China's VIA (Vehicle Inventory Alert Index) stood at 81.2% in February, a month-on-month jump of 29.5 percentage points and a year-on-year leap of 27.7 percentage points, according to the China Automobile Dealers Association (CADA). This was a record high level for the past 26 months.

Hit by the coronavirus epidemic, most of 4S stores kept shutdown during the first-half month. Some of them resumed operation from the third week and over 70% dealerships have reopened business as of the last week.

Given the traffic restrictions and purpose for epidemic prevent and control, the majority of consumers still opted to stay indoors, so that much fewer cars were sold and the maintenance service were less offered.

To weather the coronavirus-caused hardship, automobile dealers have strengthened the online marketing business through various network tools, such as VR showroom, live-streaming platform and WeChat community. They attempted to sell cars and provide after-sale services through the “contactless” forms. Nevertheless, the sales still plunged due to the demand nosedive. Besides, dealers were generally saddled with a heavier capital pressure as the large amount of inventories led to a slower withdrawal of funds. 

According to the CADA, the VIA of imported & premium brands and mainstream joint-venture brands reached at 82.3% and 81.2% in January, up by 19.7 percentage points and 13.6 percentage points over a month ago respectively. Meanwhile, the index for China’s indigenous brands surged 28.8 percentage points month on month to 78.9%.