China Automobile Dealers Association: The inventory warning index for Chinese car dealers in June was 56.6%, down 5.7 percentage points year on year

The Zhitong Finance App learned that on June 30, the latest “China Auto Dealer Inventory Alert Index Survey” VIA (Vehicle Inventory Alert Index) released by the China Automobile Dealers Association showed that in June 2025, the inventory warning index for Chinese car dealers was 56.6%, down 5.7 percentage points from the previous year and up 3.9 percentage points from the previous month. The inventory warning index is above the boom and bust line, and the prosperity of the automobile distribution industry has declined.

As a mid-year assessment point, manufacturers and dealers sprint to half-year targets and actively promote momentum through activities such as the Dragon Boat Festival holiday and “6.18.” Furthermore, the end of the college entrance examination and the increase in demand for household car purchases such as summer self-driving tours are beneficial to the increase in market sales in June. The launch of new cars and the impact of hot and rainy weather have caused some consumers to wait and see. Combined with multiple factors, passenger car sales in June were slightly higher than expected. Passenger car terminal sales are expected to be around 2 million units in June.

In order to impact the semi-annual mission target, dealers' inventory levels rose passively, and the “price for quantity” phenomenon continued, further exacerbating the problem of financial constraints. According to the survey, only 27.5% of 4S stores completed or exceeded their sales plans in the first half of the year, with the remaining 72.5% falling short of the target. Of these, 16.3% were close to completion (90%-100% range), indicating that sales of most dealers were under pressure in the first half of the year, and the risk of inventory backlog increased significantly.

Judging from the sub-index situation, the inventory sub-index increased significantly in June, and the sub-index of market demand, average daily sales volume, and operating conditions declined month-on-month, reflecting increased market pressure.

Looking at the regional index situation: in June, the overall national index was 56.6%, the northern index was 60.2%, the eastern index was 54.9%, the western index was 62.7%, and the southern index was 49.6%.

Looking at the index by brand type: The index of luxury, imports, joint ventures, and independent brands rose sequentially in June.

Market judgment for next month: Demand in the automobile market is expected to decline sequentially in July due to three factors: demand overdraft, bad weather in some regions, and the traditional low season for consumption. However, the wholesale sales volume of manufacturers continues to increase, further increasing the pressure on distributors' inventories. Although the launch of new cars from some brands and the subsequent launch of regional auto shows are expected to drive sales to pick up, overall market sales are expected to drop slightly from month to month in July.