The policy of restricting the relocation of second-hand cars has been completely cancelled, and the transaction volume is expected to hit 20 million cars this year

2022-05-23 0 By

Recently, the National Development and Reform Commission and other seven departments issued the implementation plan to promote green consumption (hereinafter referred to as the “plan”).The plan calls for actively developing second-hand car distribution, promoting the implementation of the policy of abolishing all restrictions on the relocation of second-hand cars, and further expanding the circulation of second-hand cars.In the development process of China’s second-hand car industry, it has not been rid of the “small, scattered and weak” situation, resulting in the domestic car market stock has not been effectively activated, domestic consumption power has not been fully released.However, with the development of the industry, the second-hand car market plays a more important role in the automobile market. Recently, the second-hand car industry has repeatedly released positive signals, especially the blocking point of second-hand car relocation has been paid much attention. It has become a consensus to loosen the policy for the second-hand car market and promote the development of industry norms.The policy level has repeatedly boosted the issue of the restriction of relocation and the loosening of restrictions on relocation, which has always been a blocking point that leads to the limited circulation vitality of the second-hand car market.According to the China Automobile Dealers Association, more than 95 percent of prefecture-level cities across the country had implemented migration restrictions to varying degrees.Even within the same province, the standards vary from city to city.Take Shandong as an example, once jinan’s immigration standard was to meet the vehicle emission requirements of national 5, Qingdao is national 4, Linyi is national 3.Local governments’ explanations for the implementation of the used car relocation restrictions are basically for the sake of environmental protection.At present, the number of cars in China has reached 287 million.With the transformation of China’s automobile market from incremental market to stock market, the proportion of upgrade and purchase in automobile consumption is gradually increasing, the demand and market potential of second-hand car trading is huge, and it will become one of the main driving forces for the development of automobile market in the future.From the mature international automobile market, the ratio of second-hand car trading volume to new car sales is generally more than 1.5:1.Based on this, our country pays more and more attention to the circulation and development of second-hand cars.As early as 2016, The General Office of the State Council issued several Opinions on Facilitating The Trade of Second-hand Cars, requiring local governments to cancel existing policies restricting the inflow of second-hand cars.In January of the following year, the Ministry of Commerce and the Ministry of Environmental Protection issued a unified document to cancel the policy of restricted relocation of second-hand cars.In March of the same year, the Ministry of Commerce, the Ministry of Public Security and the Ministry of Environmental Protection issued a letter for the first time on the issue of restricted relocation of second-hand cars, requiring local governments to cancel the policy.Starting from May 2020, the VALUE-ADDED tax on second-hand cars will be reduced from 2% to 0.5%, directly reducing the tax cost of dealers’ second-hand car business.In February 2021, the General Office of the Ministry of Commerce issued the Work Guidelines on Promoting Automobile Consumption in The Commercial Field, which proposed to completely cancel the policy of restricted relocation of second-hand cars. Except for the key areas of air pollution prevention and control, the immigration of second-hand cars that meet the emission standards of on-going vehicles should not be restricted.The 2021 government work report calls for removing unreasonable restrictions on second-hand car sales, which has been listed as one of this year’s priorities.On April 7, the Ministry of Commerce, the Ministry of Public Security and the State Administration of Taxation issued a Notice on Promoting the Cross-provincial Registration of Second-hand Car Transactions to Facilitate the Off-site Transaction of Second-hand Cars, requiring 20 cities to implement the off-site transaction registration of small non-operating second-hand cars on a pilot basis from June 1, 2021.On April 15, The General Office of the State Council pointed out to speed up the revision of the Administrative Measures on the Circulation of Second-hand Cars, promote all regions to thoroughly clear up the illegal restrictions on the entry of second-hand cars, relax the operation conditions of second-hand cars;Three days later, the Ministry of Commerce, the Ministry of Public Security and the State Administration of Taxation jointly issued the Notice on Promoting the Inter-provincial Registration of Second-hand Automobile Trading to Facilitate the Transaction of Second-hand Automobiles in Different places.In particular, on August 31, the Ministry of Commerce released the news that the Ministry of Commerce, the Ministry of Public Security and the State Administration of Taxation will accelerate the promotion of the registration of second-hand car transactions across provinces.According to the notice, the first batch of promotion and application for registration of small non-operating second-hand cars will be launched in 218 cities starting from September 1, 2021.Compared with the pilot 20 cities in the early stage, the number of cities with cross-provincial registration of second-hand car transactions has increased significantly, making it more convenient to trade second-hand cars in different places.Driven by the policy, the used car market has gradually begun to pick up. According to the China Automobile Dealers Association, 27.87 percent of used cars were naturalized in December 2021, up 0.79 percentage points from the previous month.And this “program” printing and distribution is to promote the development of second-hand car injection “heartwarming”.Chinese automobile circulation association deputy secretary-general Luo Lei in an interview with the huaxia times reporter pointed out that “the move to the used car industry especially used cars across the land circulation again release positive signals, abolish all used cars limited migration policy means that the used car can free flow across the country, is conducive to the healthy development of the second-hand car market and the whole car market.”In fact, it is not difficult to find that the transaction volume will exceed 19 million this year. Although support for the cancellation of the policy of restricted relocation of second-hand cars has been frequent since 2016, the problem of poor cross-regional circulation of second-hand cars has always existed according to the data.According to the China Automobile Dealers Association, previously, cross-regional second-hand car transactions accounted for only about 27% of the whole year, indicating that cross-regional second-hand car transactions accounted for a relatively low proportion in the total second-hand car market.Wang Meng, deputy secretary-general of the Beijing Automobile Distribution Industry Association, told The China Times: “Around 27 percent is still low.Based on the average of the past decade or so and the law of development, the normal circulation should reach about 33 to 40 percent.This also means that for a long time, there are certain constraints on the cross-provincial circulation of second-hand cars, and the development and relocation policy of the second-hand car market is an important influencing factor. If the cross-regional circulation is not smooth, it will inevitably restrict the development of the industry.”However, with the gradual loosening of the restriction policy, the consumption potential of second-hand cars will be further released, thus promoting the rapid development of the whole industry.According to the China Automobile Dealers Association, a total of 17.5851 million used cars were traded in 2021, up 22.62 percent year on year.Among them, a total of 10.5911 million basic passenger cars were traded, with a year-on-year growth of 23.34%.1,320,300 passenger cars, up 7.02% year on year;There were 1.4538 million trucks, up 9.63 percent year on year.Compared with 2020, all models have different degrees of growth, among which SUV models have the most obvious growth, with a growth rate of more than 40%.The promotion of the policy also makes more operators optimistic about the second-hand car market, and more and more businesses enter the second-hand car business.Data from Tianyan show that there are more than 600,000 auto dealers in China whose business scope includes second-hand cars. Among the used-car enterprises that are in operation, existing, moving in and moving out, 22% have been established within one year, and more than half have been established between one year and five years.Used car sales among China’s top 100 dealer groups accounted for about 9.4 percent of total used car sales in 2020, up 12 percent year-on-year, according to the China Automobile Dealers Association.From the perspective of the general trend, although the influx of people is not a small number, the whole used car market has returned to rational overall no longer impetuous.Industry is generally believed that the global economic slowdown, the auto industry in the backdrop of the slow growth, promote the automobile consumption is the key industry development, now all kinds of favorable policies have been introduced, especially the “wall” problem such as tax cuts, limit of gradually loosening, second-hand car market is expected to become China’s automobile consumption of the new blue ocean.Luo predicted that in 2022, the transaction volume of used cars in China will exceed 19 million, and will hit 20 million.Luo Lei pointed out: “Now the development of second-hand cars is an important part of the automobile consumption chain, and clearing the ‘blocking points’ is also to the second-hand car industry and the whole industry chain, the launch of a series of policies, including the reduction of value-added tax on second-hand car dealers, second-hand car trading, inter-provincial trading and so on, is a very good signal.From the perspective of the circulation association, we hope that the circulation of second-hand cars can be fully open.As problems such as relocation restrictions, taxation and used car registration are gradually resolved, the dividend brought by the policy will be gradually released, and the used car market will soon enter a stage of ecological reconstruction, which will drive the whole industrial chain to flourish.”Chief Editor: Yu Jianping