White goods affected real estate wilting sales fell

Today, the "home appliances going to the countryside" policy ended in the three provinces of Shandong, Henan, and Sichuan. However, under the pressure of sales decline, enterprises’ enthusiasm for rushing to eat cakes in rural household appliances will increase.

According to the National Information Center, in October this year, sales of refrigerators, washing machines, and air-conditioners in the three major white goods all showed a year-on-year decline. The three-fourth-tier market became the “last line of defense” for domestic demand withdrawal.

Will the appliance industry end its high growth cycle? Although this remains to be seen, experts warn that if the downward trend continues for several months, the government's expectation of “driving domestic demand” may need to be readjusted.

Three pressures

At the “2011 China Household Appliance Industry Annual Meeting and Home Appliance Industry Competitiveness Summit Forum” held in Hefei on the 27th, Cai Ying, Assistant Director of the Resource Development Department of the National Information Center, disclosed that in October this year, domestic refrigerator sales decreased by 9.64 compared with the same period of last year. %, washing machine sales fell 8.17% year-on-year; air-conditioning sales fell 12.11% year-on-year.

“This is the first time in recent years that the three major white goods have experienced a monthly decline in monthly sales.” Cai Ying told the China Business News that it is not yet possible to judge that the industry has seen a downward turning point, but if November, 12 The situation in the month is still the case, so the country’s expectations of domestic demand may need to be adjusted.

This year, the sales volume of three major home appliance products showed a slowdown from the growth rate to the same period last year. According to Cai Ying, sales of refrigerators increased by 8.24% year-on-year in the first quarter of this year, and increased by 5.04% in the first three quarters of the previous year. Negative growth occurred in October.

Moreover, the primary and secondary markets and the tertiary and tertiary markets are "ice and ice." Cai Ying said that in October, sales of washing machines in the first and second-tier cities fell by 14.09% year-on-year, sales in the third-tier markets increased by 4.33%, sales in the fourth-tier markets increased by 17.06%, and refrigerators also experienced negative growth in the primary and secondary markets. The market is flat and only the four-tier market is positive.

However, due to the rapid growth in the first half of the year, sales of these three home appliance products for the full year of 2011 are still expected to increase year-on-year, but the increase is not as expected.

“Cost increase, market decline, and overcapacity are the three major pressures faced by the white goods industry.” Cai Ying said that like China’s refrigerator production capacity has exceeded 100 million units last year, exceeding market capacity, other companies have entered this year, and production capacity has continued to expand. However, the costs of manpower, R&D, and materials are increasing. Market sales are falling again. Competition will be more intense and some brands will be eliminated.

Face shuffling

Wang Jinliang, Vice President of China Refrigeration Appliance Group's China Business Division, believes that the decline in the sales of the three white goods in October was caused by a combination of factors including the continuous regulation of the real estate industry, the withdrawal of energy-saving policies, and the weakening of consumer spending. The air-conditioning industry has begun to show a downward trend since July and August.

“The seawater has ups and downs, and the white goods industry can no longer maintain a rapid growth of 20% to 30% every year as in the past few years.” Wang Jinliang said that companies should be accustomed to low or even negative growth in the market. “This is a normal market phenomenon.”

One person of Hisense Kelon also said: "The economic situation is not good. People have tightened their money bags; real estate shrinkage has directly affected the sales of home appliances; the home appliance industry has grown rapidly over the past few years, spurred by the policy of home appliances to the countryside. Also have a slower breath."

In the winter, it is not without opportunities. Cai Ying said that although sales of the three major white power stations have declined in October, sales of high-end products have increased. For example, sales of inverter air conditioners in October increased by 12% year-on-year, and sales of three or more refrigerators rose by 20.5 in October from a year earlier. %, sales of large capacity washing machines are also growing.

Therefore, deepening the rural market, accelerating the penetration into the high-end, and integrating the industrial chain have become the countermeasures for companies. Haier’s “Sunshun Electric” and Gree, Midea’s specialty stores are constantly improving the network of the 3rd and 4th markets, and pushing new inverter air conditioners; Galanz is also sinking channels; Hefei Sanyo’s main frequency conversion washing machine and accelerating the 3rd and 4th level markets The development of the store; Changhong general manager Liu Tibin recently served as chairman of Meiling Electric Appliances and Huayi Compression, to promote the cooperation of the upstream and downstream industry chain of refrigerators.

Cai Ying believes that the implementation of the “Home Appliances to the Countryside” policy has contributed to the expansion of domestic demand for the past three years, and has also enabled some small businesses to obtain opportunities for rebirth. The overall number of home appliance companies has increased. However, with the exit of policies, the increase of costs, and the decline of the market, elimination and concurrent development will become the characteristics of the new industry, and the industry will embark on a path of scale and internationalization.