Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

In recent years, China’s pickup truck market has indeed become more and more dynamic. As an experienced person in these years, he has witnessed the process of pickup truck from mud legs to business and IKEA, and then to passenger use. He has also witnessed the process of pickup truck environment from spraying words and pasting reflective strips, to the pilot lifting of the ban in four provinces, and then to the gradual release of restrictions on entering cities in many provinces and cities. However, pickup trucks still face different opportunities and challenges. How to face them has become a topic that many manufacturers are thinking about and dealing with.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

Opportunity and Challenge 1: chip problem

Chips have now become the Achilles heel of the automotive industry, making the giant of the automotive industry face unprecedented production reduction and shutdown. Moreover, this situation is becoming more and more serious, resulting in the lack of chips in the third quarter far better than that in the first half of this year and last year. In particular, the recent tight supply in Malaysia has exacerbated the shortage of chips in the global automotive industry. According to the report of the Wall Street Journal, Malaysia is a little-known but crucial link in the semiconductor supply chain and one of the world’s largest assembly and testing places for control devices of smart phones, automotive engines and medical equipment. The main reason for the supply shortage is that enterprises misestimate the speed of economic recovery and do not order enough parts. Now, due to the epidemic, factories have reduced production, and it is becoming more and more difficult for car companies to get the chips they want.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

In particular, China, as the world’s largest automobile market, has been seriously affected. At present, the proportion of independent research and development of domestic automobile chips accounts for only about 10%, and 90% of automobile chips depend on imports. Under the background of global shortage, independent brands naturally face greater challenges, among which the pickup truck industry is inevitably affected. Not long ago, someone in the industry said that the pickup truck market will indeed face a serious shortage in the future, especially the highly praised main sales brands and models in short supply will be affected. On the contrary, the brands that were not sought after by the market will enter a honeymoon period when the industry is out of stock due to the previous large inventory strategy.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

Therefore, the chip problem has become a major opportunity and challenge in the current industry: for the main brands whose products are in short supply, how to effectively plan production capacity, how to effectively purchase and how to streamline chip demand have also become a challenge. Like Ford, the largest pickup truck manufacturer in the United States, not only redesigned some components so that the chip can be compatible with more functions, but also directly cancelled the start and stop function in a large area, and adopted the sales model of “production to order”. If we can reasonably solve this problem, perhaps the challenge will become an opportunity.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

For non main brands with large inventory, the shortage of chips brings them an opportunity and a rare “honeymoon period”. However, if the product quality can not reach the industry average level, for some consumers who can’t wait to buy the brand products, subsequent quality problems occur frequently and the product quality is not competent for daily use, Perhaps this opportunity will also become a challenge, which will reverse the brand value.

Opportunity and Challenge 2: lifting the ban on pickup trucks

The lifting of the ban on pick-up trucks is an old topic in China. For those who do not know the pick-up truck industry, there is basically no concept of how many provinces and cities the ban has been lifted. There will still be a stereotype among those who do not know whether the pick-up truck can not enter the city. However, only those who know about the pickup industry know what they have experienced in recent years. From being rejected by most regions in those years, they have also been “stabbed” and “sealed”, and now many provinces and cities have liberalized restrictions on entering the city; From the pilot in four provinces in 2016 to the current “bracket” pickup truck, which separates the multi-purpose truck such as pickup truck from other light trucks, the identity of pickup truck has indeed ushered in a rare opportunity to correct its name in recent years.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

Moreover, it coincides with the transformation of the passenger car market from the incremental market to the stock market. The pickup market is in the rising stage of the incremental market, which makes the pickup market a blue ocean in the automotive industry in the future. Whether the pickup industry can grow is related to the upward development of the whole industry. Just as some people in the industry said that only the cake is getting bigger and bigger, The share that we can get will also be larger and larger. The current policy support and the good situation of lifting the ban is that the pickup truck market needs to be a big “east wind”. Only by taking advantage of the “east wind” can we win greater development.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

It is also the “east wind” of the pickup industry that blows out some fragrance, which makes those enterprises with sensitive sense of smell smell the smell of money, so they also want to take advantage of the east wind to make their own ships start to launch a series of “rub heat” atypical pickup products. Most of these “atypical pickups” are based on the micro card models of the brand, adopt the standard semi load-bearing structure of micro card models, retain the characteristics of heavy load and super long, flat bottom and three-sided containers, and hope to use the name of pickup to carry out the reality of micro card, so that these wolves in “sheep’s clothing” can continue to go into the city to overload and pull goods when the right of way of pickup is expanded.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

It can be said that when the general environment of pickup policy is bad, manufacturers in the industry still pay attention to “morality”. Even in the era of pickup in the most primitive means of production, they publicize the attributes of pickup suitable for business and IKEA, and produce non bearing standard pickup products in line with industry rules. At present, when the overall environment of pickup policy is getting better and better, these “wolves” who do not pay attention to “morality” begin to rush in to produce and sell “atypical pickup” for the purpose of overloading and pulling goods. At this time, whether you want to rub the dividend of pickup policy or sincerely launch diversified models for the pickup market, I think Sima Zhao’s heart is well known.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

Therefore, lifting the ban is both an opportunity and a challenge. The challenge is that if these “atypical pickup trucks” are allowed to grow savagely when the policy is gradually getting better, it may “step on the brake” for the budding pickup trucks, thus undermining the favorable policies for the pickup industry and even forming a setback. When the lifting policy goes backward and the pickup truck industry is affected, these fast-making enterprises may have to retreat and go back to produce the so-called “cars needed by the people” sealed by themselves.

Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China's pickup market will face in the near future
Insight into pickup industry: opportunities and challenges that China’s pickup market will face in the near future

The opportunity is “no rules, no radius”. Although there are still clear regulations on how to define pickups, the general technical conditions for multipurpose trucks, which is actively involved and promoted in the industry, will become the first standard to define “narrow pickups” in China, and clearly define the boundaries of pickups from the three levels of management, vehicle use and policy. With such a standard, it will be conducive to the management of pickup trucks by relevant departments. What kind of cars can enter the city and what kind of cars are just low-end trucks to meet the policy, so there will be a judgment. And continue to formulate incentive policies for pickup trucks, including some policies most concerned by pickup truck users such as annual inspection and scrapping, so that the real pickup truck can gradually get rid of many previous policy restrictions and stereotypes.

Author:China Pickup Trucks
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https://www.chinapickuptrucks.com/insight-into-pickup-industry-opportunities-and-challenges-that-chinas-pickup-market-will-face-in-the-near-future/

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