Core Insights - The second-hand car market in China is experiencing increased activity, with an average daily transaction volume of 75,100 vehicles from October 1 to 12, reflecting a 4.98% increase compared to the end of September [1] Market Activity - The National Automobile Circulation Association reported that promotional activities by second-hand car dealers during the National Day holiday significantly boosted offline customer traffic, which increased by approximately 15% compared to the end of September [1] - The extended purchasing cycle among consumers is evident, with potential customers who inquired during the holiday now entering the conversion phase, contributing to the growth in transaction volume [1] Challenges in the Market - Despite the increased activity, second-hand car dealers are facing weak overall profitability, with gross margins remaining in the range of 3% to 4%, indicating low profit potential [1] - Vehicle turnover efficiency is under pressure, with warning signs regarding turnover cycles; the turnover days for second-hand electric vehicles have reached 30 days (warning threshold), while for fuel vehicles, it is approximately 45 days, indicating a need for improved inventory liquidity [1]

Core Insights - The report indicates a decline in the supply of used cars, prompting the industry to readjust growth expectations [1] - The impact of replacement subsidies on the used car market remains uncertain, with the duration of the current used car trend difficult to predict [1] - Ongoing price wars for new cars in May and June may suppress the activity in the used car market [1] - The introduction of new models is not leading to a quick influx of older models into the used car market, with actual transactions primarily involving older vehicles [1]

Core Insights - The average daily transaction volume of used cars in China decreased to 63,900 units from May 26 to June 1, reflecting a month-over-month decline of 1.41% and a year-over-year drop of 3% [1][3] - The total used car transaction volume for May was approximately 1.587 million units, down 6.6% from April, with only a slight increase of 2,000 units compared to the same period last year [1][3] - 45% of used car dealerships reported a significant decrease in customer traffic, while 68% indicated that their transaction volumes were lower than in April [1][3] Market Dynamics - The decline in used car transactions is attributed to the impact of new car price discounts and local consumption promotion policies during the "May Day" holiday, which diverted potential used car buyers [3] - The instability in new car pricing has exacerbated the challenges faced by the used car market, leading to longer inventory turnover times and increased financial pressure on dealerships [3] - The used car market has entered a traditional off-season earlier than usual, with a significant drop in market activity observed in mid to late May [3] Regional Analysis - In East China, the average daily transaction volume was 21,900 units, down 1.55%, with cities like Nanchang and Zaozhuang experiencing declines exceeding 20% [6] - North China saw a more pronounced decline, with an average daily transaction volume of 2,500 units, down 4.59%, particularly in cities like Shijiazhuang, which experienced a drop of over 20% [6] - The Northeast region maintained stability with an average daily transaction volume of 2,300 units, showing a slight increase in some cities like Jixi, which grew by 12.6% [7] - The Southwest region reported a decline of 2.55% in average daily transaction volume, with significant drops in cities like Lhasa, which saw a decrease close to 15% [8] - The Central South region experienced a slight decline of 0.56%, with notable drops in cities like Changsha, which exceeded 25% [8] - The Northwest region was an exception, with a 4.4% increase in average daily transaction volume, particularly in cities like Wuzhong, which grew by 21% [8]