[Automobile import tariffs have been lowered, and the auto market has been welcoming the largest official decline in the past decade] The reduction in auto import tariffs has triggered a price hike in China's auto market, which has also ignited the buying enthusiasm of Chinese consumers. On May 22, the State Ministry of Finance issued an announcement that, starting on July 1, 2018, the import tariffs on vehicles and parts will be reduced. Tax rates for 135 tax numbers with a full vehicle tax rate of 25% and 4 tax numbers with a tax rate of 20% will be reduced to 15%, and tax rates for auto parts will be 8%, 10%, 15%, 20%, and 25 respectively. The tax rate for a total of 79 tax numbers dropped to 6%.
As soon as the news came out, the major auto makers have expressed their attitudes, initiated price assessments and made price adjustments. However, due to the need for specific calculations, not all car companies have given clear price adjustment plans. The first to give a price adjustment plan is Tesla and Jeep. Less than three hours after the policy was issued, Tesla announced that it had adjusted the prices of models sold in mainland China and had already reached all sales outlets in China. The Jeep also lowered its 5-65 million yuan for its imported Cherokee car models for the first time. Subsequently, many car brands with imported car business have announced their own price adjustment programs.
According to statistics from the Economic Observer, in the three days after the clear reduction of automobile import tariffs (as of May 26), there were 9 companies including Volvo, Mercedes-Benz, Lincoln, Audi, Lexus, BMW, Jaguar Land Rover China, Infiniti, and Alfa Romeo. Luxury car companies have successively made clear price adjustments to the corresponding imported models in the Chinese market.
China's Mercedes-Benz, Mercedes-Maybach, Mercedes-AMG, and smart brands have the price cuts for Mercedes-Benz’s top three brands in China’s luxury car market. It is 0.72 million yuan (smart 1.0L hardtop smart version) to 256,000 yuan (AMGG65). Audi announced that it will downgrade its A, Q, R car prices, with a maximum reduction of 165,000 yuan. It currently only discloses Audi A8L and Audi Q7 at 4.88-8.5 million yuan. The decline, the specific guide price is still being updated. The BMW China official website shows that the price of 113 models has been lowered, and the downward adjustment range is 16,000 yuan (the BMW 118i hatchback) to 162,000 yuan (the BMW M760 LixDrive).
In the second camp of luxury cars, the price decline is also more severe. Jaguar Land Rover, who has always hoped to be in the first camp, is a "big blood player" in this official landing. For example, Jaguar Land Rover's Land Rover Range Rover Sport SVR, a drop of up to 392,800 yuan, the highest drop now. The Land Rover Range Rover Grand Edition has also lowered its 200,000 yuan.
The Lexus, which was considered to be the biggest winner in this tariff reduction and has not been domestically produced, reduced its total number of imported cars by RMB 1.4-10.9 million. Among them, as the ES model of the luxury imported automobile sales champion in the Chinese market last year, the manufacturer's suggested retail price was adjusted to 279,000 yuan, down by about 19,000 yuan. However, it is strange that Cadillac was the only one who was silent in this collective action. According to media reports, the reason given by Cadillac insiders is that since Cadillac is using import channels for importing more vehicles, tariff cuts have no effect on SAIC-GM’s Cadillac selling models. The Economic Observer reporter did not get a clear explanation from the official.
In addition to luxury brands, other imported cars are undergoing major adjustments. The American car company Ford Motor Co., Ltd. announced that its imported cars in China were all downgraded, falling by 1.5-3.5 million yuan; while Japanese car maker Mitsubishi announced that Pajero lowered its price by 4.5-6 million yuan; Dongfeng Nissan is Imported car flagship SUV Tuilee 5.6L version of the model is priced down 56200 yuan.
Although Japan’s Toyota has also responded in the first instance that it will reduce the prices of cars exported to China, it has not yet announced specific price reduction rules. Subaru's distributors in Shanghai announced on the 24th that buyers can enjoy cash subsidies for tariff subsidies in advance (except for special vehicles), but no specific price reductions have been announced.
In addition, although some car companies also responded in a timely manner, they have not yet announced the specific price cuts and details. For example, 6 ultra-luxury branded car companies, Porsche, Lamborghini, Bentley, Aston Martin, McLaren, and Maserati (China), have both been welcomed and recognized after the tariff reduction policy was announced. At the same time, it indicated that for the current tariff adjustment, the company is conducting an internal evaluation and the latest price will be announced in the near future. In addition, Rolls-Royce said that price cuts need to follow the BMW Group arrangement, while Ferrari has not made any response and price adjustments.
At this point, the number of car companies that have announced that they want to carry out official reductions (including adjustments that have not yet made price adjustments) has reached 22, which has also become China's auto industry's biggest official fall in a decade. Some analysts believe that before the official fall, because the Chinese government reduced the VAT tax rate in the manufacturing industry by 1%, a price adjustment has been made, and with the new round of price adjustment, the Chinese automobile market will enter a new price. cycle. However, market observers pointed out that the current decline in luxury cars has been relatively large, many brands in the terminal price actually has a discount of 20% or even 25% discount, the price reduction is likely to just guide the price The adjustment, the impact on the terminal remains to be seen.
On the other hand, the drop in the price of imported vehicles will prompt the price of qualified products manufactured in China to further decline, and the price of cars in the future will further decrease. "For China's independent brands, this will be a big test," said one analyst.
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