China's III Emission Standards Achieved Today

State III came, not only in Beijing and Guangzhou but also throughout the country. Today, in accordance with relevant national requirements, the country implements the National III standard. In the two and a half years after Beijing's implementation of the National III Standard on January 1, 2006, the wind of the State III finally covered the whole country.

In the face of this strong national III wind, car manufacturers, distributors and consumers have their own feelings. Consumers are more happy, they generally look forward to the future of a more environmentally friendly car life; manufacturers and dealers also appear to be more than two and a half years ago, "prudent" too much, after all, after experiencing the turmoil in Beijing in early 2006 Most manufacturers and distributors have already been ready before the implementation of the National III standard throughout the country.

The reporter learned that most auto companies had the ability to produce the III models as early as two or three years ago. In recent years, environmental protection technologies for vehicle production have been greatly improved. Because these manufacturers understand that environmental protection and energy conservation are the general direction of future market development. Whoever can master new technologies earlier than others will be able to win in the future competition.

In the face of the implementation of State III, FAW Toyota, GAC Toyota, Shanghai Volkswagen, Shanghai GM, Dongfeng Nissan and other joint ventures generally stated that “there is absolutely no problem in vehicle replacement”, and in many regions of the country, new emission standard models have already been shipped. To the dealer's shop, waiting for sales. The self-owned brands also performed well in environmental protection technologies. Relevant persons in charge of leading brands such as Chery, Brilliance, BYD and others told reporters that, even if they were facing State III, they would not be vague even if they faced State IV.

In short, the National III standard is implemented nationwide, and most car manufacturers have no barriers in the production technology of the models. But at the same time, the reporter also learned that many auto companies, especially their own brands, still have a lot of Inventory II vehicles that have not been sold. This part of the car's "way out" after July 1 has become a topic of immediate concern in the industry.

Various channels to digest the national II car

Through unannounced visits to distributors in Hebei, Liaoning, and Sichuan, it was learned that many of the brand's national II models are still being sold, and some dealers stated that it would take at least a few months if the stock cars were to be digested. . The adoption of environmental inspections in advance is a common method adopted by these dealers. After passing the inspection, the vehicles can still be sold after July 1.

While passing environmental protection certification in advance, in recent months, all of China's II models have been selling at a large margin. It is not difficult to find the price cuts of the website's car channel. In the past one or two months, many models across the country have seen higher-than-usual sales revenues. However, under the premise that the national auto market environment was deserted in May and June, this kind of profit-taking promotion effect is not very obvious.

In addition, early adoption of environmental inspections requires distributors to pay large sums of cash, and it is not possible to fully digest all of the manufacturers’ inventory II models. "In some relatively economically backward areas, finding local 'policy support' is another way for these manufacturers." An industry expert said to reporters. The expert’s argument has been recognized by many people in the industry. “In consideration of local taxation and ensuring economic development, certain regions will give green light to these substandard vehicles.” Many people think that this is the case.

Imported cars calmly deal with

In fact, when domestic auto brands are responding urgently to emission upgrades, the impact on imported brand models is not significant.

A Mercedes-Benz brand dealer told reporters that at present, Mercedes-Benz cars sold in China, both passenger cars and commercial vehicles have reached the highest domestic emission standards. The implementation of the National III Standard does not constitute any threshold.

Many dealers of imported brands stated that because the imported models are mainly high-end, the price itself is very expensive, and the purchasing users will not be too sensitive to the price. Therefore, compared to the situation that domestic cars have a slight fluctuation in their prices due to emissions, compared to the situation affected, imported brand dealers will have a better position after the implementation of State III. Instead, consumers will ignore the impact of imported brands.

Commercial vehicle meets cost test

The implementation of State III emission standards will undoubtedly be severely challenged for domestic commercial vehicle companies in terms of product development, after-sales service, parts supply, and cost control. However, as cities such as Beijing, Guangzhou and Shanghai have taken the lead in implementing the National III emission standards, this is already ready for upgrading for large and medium-sized commercial vehicle companies.

As the largest commercial vehicle company in China, the related person in charge of Foton Motor told the reporter that the new cars that Futian Automobile currently meets the national III emission standards have already been put on the market, and some models that meet the national IV emission standards have also been listed. It is worth noting that it was Foton Motor's early launch of the China III model that allowed Fukuda to reach the top spot in the global commercial vehicle market in the first quarter of this year.

More commercial vehicle companies are worried that the implementation of the National III standard will increase the pressure on the company's cost. In the second half of the year, commercial vehicles will have to face the problem of price increases.

The growth of commercial vehicle production costs is mainly at the engine. An industry source disclosed to reporters that from the national II standard to the national III standard, the cost of the business must increase by at least 30,000 yuan. However, at the beginning of the year, the cost of enterprises will increase by 6%-10% due to the increase in the cost of steel and other commercial vehicle companies.

A light truck manufacturer told reporters that at present, the domestic low-end light trucks are still in the national standard phase II, the price does not exceed 80,000 yuan, after the price of 30,000 yuan in July, these light-card companies will be difficult to hold on .

Industry experts said that after experiencing continuous increases in raw material prices, companies have not been able to fully absorb the cost pressures caused by emission upgrades. In the second half of the year, the rising trend of commercial vehicles is inevitable.

Recently, China National Heavy Duty Trucks took the lead in making public statements and did not rule out the possibility that heavy trucks will continue to increase prices.

Consumer demand may plummet

In the industry's view, the implementation of the National III emission standards will not only reduce the profits of auto manufacturers' bicycles, but will also cause a sharp drop in auto consumption demand.

"Although the automotive industry has maintained a strong growth trend in the first three months of this year, the price of cars has changed from the previous trend of decline, and turned upside down. Factors such as steel and emission standards have led to a decline in the profitability of the automotive industry. This may lead to a reduction in consumer demand in the second half of this year, said Guo Yan, manager of the Beijing City Asian Games Village Auto Business Information Center.

In the statistics of the China Association of Automobile Manufacturers, passenger cars and commercial vehicles have seen a slowdown in growth in recent months. “The domestic production companies will face the test of emission upgrades, especially some independent brand enterprises. In the current situation, even if the price increases, there is still a gap between the prices of domestic and foreign brands, so it will retain a certain living space. "An industry source said.

However, the National III emission standards are fully implemented today. The rise in cost pressures has caused some companies to pass on the idea of ​​passing on costs. Yang Yang of the China United Automotive Market Planning Department also believes that once the balance of prices is broken, market demand will certainly be affected. “The upgrade of the National III Standard and the National IV Standard has already released the consumer demand of some cities ahead of schedule. If the price increases substantially, it will certainly change the domestic competitive landscape in the second half of the year.”

At the same time, the industry generally believes that as the competition intensifies, the impact of the State III upgrade will be gradually digested, and the product structure adjustments of various companies will also be gradually completed. After experiencing a wait-and-see period, the needs of consumers will rise, but it is still difficult to recover to last year's irritability.

"Commercial vehicles are in a worrisome situation this year. The early release of consumer demand will cause companies to face ups and downs in the second half of the year. If companies can't afford to plan ahead for cost control, they will face challenges in the future." Yang Yang said.

Rising car prices are inevitable

Compared with State II, the State III model has a higher technological content and costs vary by a few hundred to several thousand dollars. Therefore, after the full replacement, the prices of cars in all regions of the country will generally rise. “Under the premise that the increase in raw materials has brought great pressure, it is now very difficult for auto manufacturers to absorb the cost of technology upgrades in the company,” said Jia Xinguang, an automotive analyst.

Many people in the industry also believe that after the implementation of the National III, the car price will inevitably rise to a certain extent. "If some brands still say that they will digest the cost of this part of the technology upgrade, then it is absolutely not credible." An expert reminded consumers that even if the price of the car does not rise, companies will invest this part of the funds from the aspects of configuration and after-sales service. "get back". Because the profits of the vast majority of models now, can no longer support a little more cost increases.

However, many dealers are also worried that once the car price rises, it will undoubtedly worsen the already deserted sales. They are generally worried about sales in the second half of the year. Many market participants also confirmed the distributors' concern. An executive from Beijing Huaxiang Automobile Trading Market stated that after the country officially implements the vehicle sales country III standard, the market will inevitably have a period of sales decline. “This is undoubtedly the case in Beijing in the past two years.” The manager told reporters that Beijing, a city with such a strong spending power, needs a few months of adaptation, and the situation in other parts of the country is even more conceivable. Knowing, "In short, the increase in car prices is a common inevitable result."
View related topics: State III standard commercial vehicle companies usher in new challenges

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