Prominent Automaker Issues Warning: Prepare for a 15%–20% Industry-Wide Decline This Year
At the Chongqing Auto Forum, NIO Inc founder William Li issued a warning that China's auto industry retail sales are expected to fall 15% to 20% year-on-year for the full year, stating that the sector has entered a brutal final stage. Data shows that retail sales dropped 19.5% year-on-year in the first five months of the year, with a further 23% decline in the first week of June. Li pointed out that this is the most difficult year since he entered the industry, with market uncertainty prevailing and the sector shifting into an era of growth from an existing base, requiring companies to prepare for long-term challenges
“For full-year domestic retail volume, we believe that compared to last year, the entire industry should be mentally prepared for a decline of 15% to 20%.”
On June 13, at the Chongqing Auto Forum, William Li, founder and chairman of NIO Inc, presented this assertion.
Li believes that China's auto industry has entered the most brutal phase of the finals starting this year. From January to May, the domestic retail market fell by 19.5% year-on-year. “In the first quarter, many still believed there were some adverse effects from the premature release of policies from last year. But after entering April and May, the industry should no longer harbor such illusions.”
According to the latest data released by the China Passenger Car Association (CPCA), the decline in auto retail sales is widening. In the first week of June, the national passenger car market recorded retail sales of 228,000 units, a year-on-year decrease of 23% and a month-on-month decrease of 11%. Cumulative retail sales since the beginning of the year totaled 7.327 million units, down 20% year-on-year.
In fact, this is not the first time Li has issued such a warning.
At the media briefing for the Onvo L60 on June 12, Li also mentioned that, from the perspective of the domestic consumer market, this is the most difficult year since he entered the auto industry. He believes that much of the pressure has yet to fully transmit through; dealers are under significant pressure, and the used car industry is facing immense stress. Although NIO itself continues to grow and benefits from the relative rise in the pure electric vehicle market, there are still many uncertainties in the coming months, and market challenges are substantial. How to navigate this period is a question every company must answer.
Li believes that the entire auto industry is entering an era of growth from an existing base. If the industry adopts this understanding, many marketing and product strategies will need to adjust. “Over the past two years, NIO has repeatedly emphasized internally that the auto industry is a marathon on a muddy road—there are no miracles, no quick victories,” Li said.
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