Core Insights - The new car market has outperformed the used car market in the first half of 2025, with new car sales exceeding 15 million units, showing a year-on-year growth of over 10% [2][3] - Used car transactions reached 9.57 million units, with a modest year-on-year growth of only 1.99%, falling short of industry expectations [2][3] Used Car Market Performance - The used car market has been overshadowed by the new car market, with a significant shift in consumer preference towards new vehicles due to frequent price reductions [3] - In June, used car transaction volume increased to 1.66 million units, marking a month-on-month growth of 3.34% and a year-on-year increase of 9.12%, but the average inventory cycle extended to 43 days [3][11] - Despite challenges, industry sentiment remains cautiously optimistic, with 53.57% of participants in a recent conference predicting a transaction volume increase of less than 10% for the year [3] Pricing Trends - The average transaction price of used cars has been on a downward trend, influenced by the new car market's promotional pricing, which has disrupted the existing pricing structure [4] - The average retail price of used new energy vehicles (NEVs) is approximately 96,000 yuan, with a notable increase in the transaction share of models priced between 80,000 and 150,000 yuan [6] New Energy Vehicle Insights - The penetration rate of used NEVs has been rising, with retail sales of NEVs reaching 5.47 million units in the first half of 2025, a year-on-year growth of 33.3% [6] - The share of used NEVs in the overall used car market is expected to grow, with the penetration rate increasing from 8% at the beginning of the year to 9.9% by May [6][8] - The majority of used NEVs sold are pure electric vehicles, accounting for nearly 75% of retail volume, with significant contributions from brands like Tesla and BYD [7][8] Market Outlook - The second half of 2025 is anticipated to see a market recovery, driven by seasonal demand and the potential for new car price stabilization [11] - The adjustment of consumption tax on super luxury cars may benefit high-value used car dealers, although the overall impact on the used car market is expected to be limited [12]

Core Viewpoint - The ongoing price competition in the new car market is significantly impacting the used car sector, leading to a decline in used car transactions and prices due to consumers opting for new cars at similar or slightly higher budgets [1][4]. Group 1: Used Car Market Performance - In May, the used car transaction volume decreased by 5.72% month-on-month and only increased by 1.22% year-on-year, primarily due to the diversion and pressure effects from the active new car market [1]. - The average resale value of three-year-old fuel vehicles dropped from 56.8% in 2023 to 51.8% in 2024, with mainstream brands seeing values fall to 45%-50% [6]. - The average resale value of three-year-old electric vehicles (BEVs) is below 50%, with specific figures showing 44.2% for BEVs and 46.1% for plug-in hybrids (PHEVs) [8]. Group 2: Market Challenges - The fundamental issue in the used car market is its struggle amidst the rapid transformation towards new energy vehicles, with inadequate certification, circulation systems, and supporting services [3][11]. - The used car industry faces integrity issues, with some operators engaging in deceptive practices that harm the overall industry image [3]. - The financial penetration rate for used car loans is only 48%, significantly lower than that for new cars, indicating a lack of supporting financial services [3]. Group 3: Market Dynamics and Future Outlook - The price war in the new car market is intensifying, with a record number of manufacturers participating and significant discounts being offered [5]. - Despite the challenges, the used car industry is entering a development window, supported by a large existing vehicle stock of 353 million units and the removal of inter-regional sales restrictions [11]. - The intensity of the price war is expected to decrease, with industry organizations advocating for healthier competition and regulatory measures being implemented to stabilize the market [12][14]. Group 4: Export Opportunities - The used car sector is looking towards overseas markets for growth, which require adherence to established regulations and standards, potentially benefiting the domestic used car industry [15].