China: Automakers spend heavily on discounts but fail on sales satisfaction image

A recent study shows that despite the fact that automakers and dealers have boosted their discounts aimed at vehicles buyers, the overall sales satisfaction in China has declined from last year.

Offering big discounts to car buyers is part of the automakers’ strategy to pile up bigger sales numbers and a report made by J.D. Power for China reveals that companies and dealers in the country have been very aggressive in their strategy, especially in the premium segment. According to the study, the average discount per vehicle in the luxury sector has almost doubled in the last couple of years, from 17,108 yuan (2,571 dollars) in 2014 to 33,468 yuan (5,029 dollars) in 2016, while the average discount per car in the mass market segment has increased to 9,303 yuan (1,398 dollars) from 7,316 yuan (1,100 dollars). However, J.D. Power said the overall sales satisfaction has decreased in both directions, presenting a significant challenge to the industry, in its struggle to balance between discounting and delivering a satisfying sales experience.

Audi ranked the highest in satisfaction with new-vehicle sales experience among luxury brands for a fourth consecutive year. Among the mass market brands, Dongfeng Citroen came on top, followed by Beijing Hyundai and Dongfeng Peugeot.

Other study findings show that Chinese car buyers are starting to look for power, as vehicle performance is playing an increasingly important role in the purchase decision. Also, using the internet as information source saves money, as new-vehicle owners who shopped online received a discount of 12,856 yuan (1,932 dollars), compared with 10,130 yuan (1,522 dollars) among non-internet users.