In the second half of the home appliance market or down more than 10%

In the second half of the home appliance market or down more than 10% Peng Yi, vice president of Zhongyekang Market Research Corporation, believes that in the second half of this year, the overall decline in the home appliance market will be at least 10%, and some categories may decline by more than 40% or even 50%. Not much good news is that upstream raw material prices are expected to continue to operate at a low level. Household appliance manufacturers have little pressure on production costs and product gross margin is expected to continue to be good.

Domestic brands become the biggest beneficiaries of policy dividends

During the implementation of the policy from June 2012 to May 2013, the home appliance market has risen steadily.

According to data from the survey of China's Yikang, as of May of this year, the home appliance market reached a peak of RMB 130.3 billion in the current month, a year-on-year growth rate of 30.1%. The performance of various beneficiary products was particularly impressive: TV retail sales increased from the same period in June 2012 to 4.8%, at the end of one-year policy, its YoY growth rate was 53.9% in May 2013; retail sales in the refrigerator market increased from -32.7% in January 2012 to -7.4% in June 2012, and then to In May 2013, it was 24.4%; the year-on-year growth rate of the washing machine market was from -26.8% to -3.4% to 30.6%; the year-on-year growth of the air conditioner market was -44.4% to 53.1%. Domestic brands have become the biggest beneficiaries of this policy dividend.

"The government's subsidy prescription has a satisfactory effect in the short term, but in the long-term, whether it can treat both the symptoms and the symptoms, or will make some home appliance companies suffer from policy dependence, and it will be further tested by the market." Zhong Yikang revealed that the energy-saving policy is close. Within one month after the official, there was a significant shock in the appliance market: From June 3 to June 9, the retail sales of air-conditioning products and retail sales fell by 63.8% and 63.6% respectively; the retail sales of washing machines and retail sales were respectively Declined by 57.2% and 61.2%.

"Post-Subsidy Era" Coping Strategies: Turning Types into Controlled Inventory

In the market that was originally running naturally, after the government’s participation, it caused an overdraft in spending power. Many industry officials criticized the fact that the home appliance policy that was introduced frequently has caused distortions in the market.

Yang Dongwen, president of Skyworth Group, believes that the energy saving subsidy policy is a special policy of promoting consumption under the backdrop of the global financial crisis and consumer-driven market transformation at that time, which objectively promoted the upgrading of household electrical appliances and promoted industrial technological progress. Energy-consuming and energy-inefficient products are eliminated. “Now 200 liters of refrigerator products have an average daily power consumption of less than half a degree, which is about 0.38 to 0.4 degrees. This is something that was difficult to imagine before. This is the result of policy promotion and promotion. The merits and demerits of evaluation policies cannot be separated. The environment at the time."

Yang Dongwen frankly stated that the industry and public opinion do have some criticisms of the energy saving and subsidy policy. First, for the objective laws of market operation, some distortions have been formed. Second, there are objectively unfair problems. Only those who buy energy-saving appliances can enjoy it. Discounts are not available for people who do not buy. Third, the process of subsidy policies is relatively long and the cash flow pressure from manufacturers is increasing.

How should home appliance companies respond to the "post-subsidy era"? Yang Dongwen said that for manufacturers, one is due to the withdrawal of the policy, involving the switching of product models; the second is how to deal with market fluctuations have become a problem, suppliers must grasp the management of inventory, through their own power to activate the market. "The sudden suspension of energy-saving subsidies has left the home appliance industry with three after-effects: Consumer psychology, consumer demand advance overdrafts, and overcapacity in excess inventory. Policy overdrafts and the lack of liquidity in the latter period have all caused home appliances in the second half of the year. The industry is in a period of deep adjustment.” Peng Yue, vice president of China-Ecocom, believes that the home appliance market will enter the downtrend channel in the second half of this year and the overall decline will be at least 10%.

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