China's auto finance market is experiencing "seven-year itch"

As of the end of 2010, 9 of the 13 auto finance companies approved by the China Banking Regulatory Commission were established by foreign auto giants.

At the 7th Beijing International Finance Expo held on November 3-6, almost all of the financial institutions that emerged were a special figure of Beijing Automotive Group Co., Ltd. (hereinafter referred to as “Beiqi”), attracting many exhibitors. Eyesight. To explore the reasons, apart from the background of the combination of industry and finance, its financial company has just been approved by the China Banking Regulatory Commission is a great opportunity, but the deeper reason is that the Beiqi Department of automotive finance companies are trying to break out.

In fact, China’s auto finance market is undergoing a “seven-year itch”. From the establishment of SAIC General Motors Financial Co., Ltd., the first auto finance company in China in 2004, to the temptation of “cake” in China’s huge market size and huge potential for car consumption, many international auto giants or wholly-owned or jointly domestic cars Vendors and large financial institutions have invested heavily in the Chinese auto financial market. However, looking back at the development history of the entire industry, we can only say that it looks “beautiful,” and the entire industry turned to profitability in 2007, and the entire industry only made a profit of 16.47 million yuan, and the current loan balance is only about 50 billion yuan. , and the bank's car consumption loans can not be the same.

In response to this, Bei Min, vice president of Beiqi, said in an interview with a reporter from the China Economic Times: A very important reason is that our universal credit system has not yet been established.

You can see that the auto finance market in South Korea has developed very well these years, mainly because their credit system has been built better.

In Wang Min’s view, the “insufficient” development of the industry is also a key factor that restricts the expansion of the auto financial market.

The Chinese auto market, which has been declining since the US subprime mortgage crisis in 2008, has seen a blowout market for two years with the support of state policies. However, with the completion of the task of driving the national economic growth of the auto industry, the country began to gradually tighten or even cancel some related preferential policies. At the same time, in some cities with serious pollution and traffic jams, strict restrictive policies have also been introduced, such as the “restriction order” in Beijing. In the past two years, the “policy market” placed a huge feast on Chinese cars, making the auto market more and more deserted.

In mature markets such as Europe and the United States, 70% of car sales are sold through auto loans, and the profits of auto finance account for 50% of all profits of auto manufacturers. In the automotive value chain, auto finance plays an absolute “protagonist”. Take BMW as an example. In 2010, sales volume of BMW MINI in mainland China reached 10,509 for the first time, a year-on-year increase of 140%. The Chinese market has become the fastest growing market for MINI in the world. The reason is that apart from the low consumption tax on small-displacement cars, it is even more crucial that BMW has created an automotive finance solution for MINI. According to the reporter’s understanding, with the cheapest MINI product, the minimum down payment for consumers is more than 40,000 yuan, and the monthly repayment amount is about 3,000 yuan.

In contrast, China's auto finance is still only a "support role" in terms of market capacity, profit contribution, or sales promotion. However, compared to the more than 90 years of auto finance history in Europe and the United States, the just-started Chinese market is still alive. In particular, since the second half of last year, due to the continuous increase of interest rates by the central bank and repeatedly raising the deposit reserve ratio, the car loan business has been “injured” and many banks have already stopped the business. Auto finance companies have become the biggest beneficiaries. This year, various auto finance companies have adopted a more aggressive offensive posture, and have achieved substantial growth with a rich and flexible credit plan and a looser qualification than the bank’s approval. For example, in the first half of 2011, the company's personal credit business grew by 31.36%. From its establishment to August this year, the number of individual customers has exceeded 600,000. In addition, the efficiency of loan approval has also been greatly improved. It takes only one hour from the time of application to lending, and it can provide the fastest car within two days.

However, most of the auto finance companies currently established in China are still dominated by foreign capital. According to the data disclosed by the China Banking Regulatory Commission, as of the end of 2010, the China Banking Regulatory Commission approved the establishment of 13 auto finance companies. Among them, 9 were established by auto giants including Toyota, General Motors, Ford, Volkswagen, Daimler, Peugeot Citroen, Volvo, Fiat and Dongfeng Nissan. Among domestic automakers, only GAC and Chery were established in 2009. Automotive finance company.

According to the prediction of China Association of Automobile Manufacturers, by 2025, China's auto finance industry will have a market capacity of 525 billion yuan.

Naturally-owned car companies naturally do not want this fat to fall into other populations. BAIC is no exception. As early as four years ago, Foton, a subsidiary of Beijing Automotive, had cooperated with Mercedes-Benz Financial Co., Ltd. to carry out auto consumer credit business for end-users, and Foton Motor provided guarantees for customers. The customers borrowed from Mercedes-Benz Financial. Although at that time, this gave Fukuda an excessive degree of reliance on bank resources, it was not its own financial service platform. Today, the Beiqi Department of automotive finance companies is ready to go.

When the reporter asked about the specific time for the establishment of the Beiqi Department Auto Finance Company, Wang Minlian said that the two were “very soon and very quickly.” The words of a person in the Beiqi Brand Department were somewhat meaningful: “I hope there will be an opportunity to have a look at the end of the year. ."