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Many used car businesses have been struggling since Q3. Photo: Bối Hà. |
The sluggish economy not only affects the new car market, but many used car dealerships also face the same situation of waiting for customers. Many traders have to take on two or three extra jobs to sustain their business during this prolonged difficult phase.
Selling only one car in a month
Mr. Tuan (Ho Chi Minh City), the owner of a used car dealership in Ho Chi Minh City, shared about the most difficult period in his business journey. According to him, after the extended Covid-19 period that caused an economic downturn, 2022 is the time when the business and revenue of the dealership truly recovered.
However, in 2023, the dealership’s business started to decline again for several consecutive months. There were months when Mr. Tuan’s dealership only sold one used SUV to a regular customer. Even after deducting investment costs, storage, and advertising expenses, the profit margin was equivalent to only a few hundred thousand dong.
“This year, we could hardly make any profit. The number of customers looking to buy new cars is already low, and the number of customers looking for used cars has decreased even further. There was a time when we only sold one 2021 Xpander in a month, and after deducting the costs, it was just enough to break even,” Mr. Tuan shared with Tri Thuc – Znews.
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Used car dealers face difficulties as the number of customers decreases. Photo: Đình Thông. |
According to the owner of this dealership, since late Q2, the revenue of the store has rapidly decreased, equivalent to a 50-60% drop compared to the same period last year. In both Q3 and Q4, Mr. Tuan’s dealership was only able to sell about 10 cars, mostly mid-size and affordable sedans like the Toyota Vios or Hyundai Accent.
Similarly, Viet Anh (Hanoi), a used car dealer, also shared about the difficult period when the used car market no longer attracts many new customers. The young man said that he did not sell any used cars in November despite spending a lot of money on marketing and building his personal brand.
However, since Viet Anh mostly sells his used cars as “buy and sell” deals, his storage and display costs are lower compared to larger dealerships in the area. To earn additional income and continue his passion for car business, Viet Anh has to sell car parts and accessories to cover his advertising expenses.
“This year, business has been difficult due to the declining economy, and customers are hesitant to spend a lot on cars. With the sharp decrease in the price of new cars, if there is a need, most people would rather buy new cars instead of used ones,” he added.
Working extra jobs, changing professions due to the lack of customers
Khanh H. (Ho Chi Minh City), an employee at a used car dealership in Binh Thanh District, had to switch professions after many years of dedication. According to him, the base salary is usually not high, so employees have to try to sell more cars to earn more commissions. However, since mid-2023, the number of customers coming to the store has decreased, and the dealership has suffered losses, resulting in some employees having to take leave.
“The store is struggling, there are no customers, but we have many employees, so some have to take leave. Last year, I could sell an average of 3-4 cars per month, but this year, selling 2 cars is a reason to celebrate. Now I open an online food shop with my wife to earn extra income, and occasionally work as a freelancer for a few car dealerships to earn a commission,” Khanh shared with Tri Thuc – Znews.
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Used and new cars compete to stimulate consumption. Photo: TMV. |
In the last months of this year, many car models on the market have been applying various promotional programs to boost consumer spending in difficult times. Some car models are even ready to reduce prices by more than 200 million dong to clear inventory, but sales numbers have not improved yet.
Throughout the first 11 months of 2023, the total production of domestically produced and assembled cars reached 308,600 units, a 15% decrease compared to the same period last year.
The new year is considered the time for the automotive market to recover, and it will also be a fierce battle between the new car market and the used car market.
Good books to read in the car
In the Xe category, we bring readers interesting books on various topics. During the journeys with our cars, we often have moments of rest and relaxation, and books are our companion.
