“Some people will be eliminated, and some people will develop better.”

Look at the business with perspective. Super views, from the frontier observations of new business practitioners.

dictation | Special Observer Hu Xianhe

Interview, editing | Qin Xiaotong Barry

From daily rent of 4 yuan to 200% increase in monthly rent demand, roller coaster in the car rental industry | Super View

Editor’s note: Previously, affected by the epidemic prevention and isolation policy, the car rental industry was also hit hard, and a large number of vehicles could not go out for operation. As a car rental platform that provides appointment travel services to more than 300 cities across the country, Wukong Car Rental has witnessed the ups and downs experienced by the entire car rental industry during this period of time-including the reduction of daily rents to single-digits Marketing strategy; companies that have borrowed large amounts from banks to achieve economies of scale have tried their best to let the banks extend the term; accommodating users in services and picking up the vehicles at home … Wu Xianhe, CEO of Wukong Car Rental, regards the epidemic experience as a business In the big waves, companies that have done a good job in management and operation will be left behind, and those companies that are full of loopholes will be eliminated. Nowadays, with the gradual liberalization of reinstatement and isolation policies in various places, the car rental market has ushered in a new wave of climax.

Car rental business has fully recovered, and revenue in the first quarter has not been affected

Compared with the hibernation in early February, which was affected by the closure, the industry has a tendency to recover from the end of February. After entering March, since most of the enterprises in this city began to resume work, and began to flow in other places, the business has been rapidly picking up.

In terms of data, the recovery of the entire local market even exceeded the normal level before the holiday . Because there is a segregation policy for off-site travel, the recovery is slower. As a car rental service platform that provides appointment travel services in more than 300 cities across the country, in our normal business, there is more demand for offsite travel than local, 40% local, 60% offsite, but now it is the reverse More than 60%. So when the two are added together, our business is completely restored. Especially in the second half of March, including early April, it has reached and surpassed the level of normal months without extra-long holidays in November and December last year. Therefore, we are quite optimistic that despite the many impacts in February, the overall business in the entire first quarter has grown from all dimensions compared to last year.

We have also done some research, and now users have more than 28% of self-driving tours in different places, 30% of local daily travel needs, and 32% of peripheral tours. Quotient9% of business trips. The demand for local commuting and surrounding tourism has increased significantly, and there was no local surrounding during the severe epidemic. Everyone held back for several months, and now it’s blooming, and the demand for relaxation when traveling on weekends is particularly high. In the same period in previous years, the demand for off-site tourism is very high, it will dilute the local tourism.

The car data of new and old users are increasing rapidly. There are many old users repurchasing, and the growth trend of new users is also more obvious, exceeding about 20% in November and December last year.

Before the outbreak, the cost of renting a car was relatively high. Due to the current epidemic situation, a large number of vehicles have been idle. Various platforms have done a lot of activities to promote marketing. Like our cheapest model, 4 yuan a day, other platforms also have 6 or 8 yuan a day. For users, this price is very Suitable.

In addition to renting a car, you can enjoy the privacy and freedom of the space, and it can also meet everyone’s current need for safety, so that commuting to work without having to have too much close contact with others. So this year’s monthly rent demand has increased by more than 200% over the same period. In response to the surge in commuting demand, our city inventory has also increased the number of economic vehicles by 30%.

At the same time, due to the blockage of offline customer acquisition channels, more merchants began to settle on the platform, hoping to expand his business online, so During this time, our platform has entered a lot of RVs and supercars , Including Lamborghini, Ferrari, Marsala, etc., we may now be the country’s largest RV and supercar collection platform. Therefore, from the perspective of the number of inventories and the types of models, we have an overall improvement of about 30%.

In terms of service, because many users have been educated to get used to service without leaving home, so now renting a car to pick up the car has become a necessary service. Most merchants can now provide free pick-up and drop-off service within three kilometers, with appropriate charges for long distances. This kind of service was rarely used before.

So the epidemic is forcing us to make great improvements in service capabilities, product innovation and management. Organizational efficiency has also increased significantly. When all processes are online, it means that everything can be data-driven, more transparent and shared.

It depends on who can survive in such an environment

The impact of the “Black Swan” incident on all industries is the same. Those companies that are relatively fragile and have management problems will be eliminated, and those with strong system capabilities that usually do well in operation and accumulation Instead, it will become a beneficiary, and even get a better chance. This is itself an evolutionary process that the market should go through.

At this time, many companies’ management problems will be exposed. Taking the car rental industry as an example, there are some heavy-asset enterprises that operate with high debt. Instead of using debt to form a fleet, they use very high Interests go to loans, and some companies have not built up their basic capabilities, but rely on the skyTianda advertising and a lot of money burning to maintain the growth of user scale and traffic scale will face difficulties at this time.

We have been developing with a cautious and optimistic attitude, rather than blindly advancing, so when this disaster came, we were quite calm and did not fluctuate too much.

In the past five years, I have seen too many companies, and I have received a lot of financing. Obviously, under the good circumstances, I finally tossed myself to death. The car rental industry has a scale effect. If the company does not have a certain scale and the cost advantage cannot come, the scale effect cannot be reflected; but the larger the scale, the greater the operational challenges faced by the company. Especially for companies with too much financial burden, large scale is not a good thing. Paying interest every month is a huge expense. There are some such car rental companies on our platform. In order to achieve rapid expansion, we have bought many cars with loans. The scale of hundreds of cars is currently very uncomfortable at this stage. If the bank is willing to extend the period, if it ca n’t He was in great trouble and had to find a lot of money to fill the hole. So I think that companies should develop with a cautious and optimistic attitude, rather than blindly go ahead.

We are just a platform with no assets and no pressure on vehicle loans. The main expense is human costs, so the epidemic did not put a lot of pressure on our cash flow. But all car rental companies with assets on the platform have tight cash flow. Our platform brings together thousands of car rental companies, one is a company that has no loans, and it is basically closed; the other is a company that buys a car through financing loans. The order is gone, the company’s income is gone, and it continues to pay monthly supply, including The influence of some external factors, such as restricting the line and closing the city, even if there are orders, customers ca n’t return the car or the car rental company ca n’t deliver the car, which brings huge risks and pressure to them.

According to our research, 30% of car rental companies are in a very difficult situation. At present, each company has its own set of solutions. Including that our platform has given priority to these merchants after placing orders after resuming work.

The same is true for the entire car rental industry. Now we are not only the car rental platform, there are many other companies, including the travel field, there are many types of competition, Now look at who can survive in such an environment Come down, and even better seize the opportunity. After this wave of waves, some people will definitely be eliminated, and some people will develop better.

The domestic car rental industry is still in the early stage of development

When I resigned and founded Wukong Car Rental in 2014, I saw that the industry is still in its early stages, and the entire industry has not yet been finalized, and there is still huge room for the future. This market is related to the demand for more than one billion people to use cars, not only domestic and foreign needs, but also the needs of foreigners to use cars in China.In the final analysis, the automotive industry chain serves mobility.

Car rental is still at an early stage of development in China. Compared with five to ten brands in Europe and the United States monopolizing the entire market, there are more than 25,000 car rental companies in China. These companies have a stable business, such as long-term rental, as long as they can sign a stable bus contract with a local government or a company, they can open a car rental company, and the business can be recycled, and by the way, make a short rental , You can live well. From the supply side, because there are many companies, the concentration is not low. From the demand side, There are still few users who have used car rental services. According to our statistics, there are more than 20 million people, but China ’s 1.4 billion people have 400 million drivers alone. . Many people have never rented a car, because renting a car is more expensive, and the cost is higher. In addition to rent, car rental also has insurance-related expenses, as well as fuel money, tolls for crossing bridges, parking fees, and frequent violations. Various costs It is much more expensive than staying in a hotel. So at present, car rental is not as popular as everybody in the world. Larger listed companies like Shenzhou and Yihai in the industry are about 100,000 vehicles, and the scale is not particularly large, because foreign car rental companies are basically the scale of hundreds of thousands or millions of vehicles.

To break the current situation where the penetration rate is not high, a very key point is the absolute reduction in the cost of car rental , or the purchasing power of ordinary people. When renting a car for 24 hours for only 100 yuan, many people may accept this way of travel. Now that the cost of renting a car is about 300 yuan a day, people will consider going to a taxi; let alone a good car like Mercedes-Benz and BMW. The overall cost of renting a car is more than 800 yuan a day, which is the same as the cost of staying in a five-star hotel.

Renting a car abroad is very cheap. For example, in the United States, if you rent an economy car, it will cost about $ 20 a day, which is about the same price as going out for a home-cooked meal or even fast food. Moreover, the cost of foreign oil is cheap, the toll There are almost no violations. So when the per capita cost of renting a car is equivalent to the price of an ordinary home-cooked meal, it can be popularized to the level of ordinary people.

On the other hand, At present, taxis are cheaper in China, and taxis abroad are at least three times more expensive than renting a car , because labor is becoming more expensive. In addition, the price of vehicles will not have much room for increase, and the cost of renting cars will not increase anymore, because the auto industry is becoming more and more competitive, and it is also showing a trend of oversupply, and vehicle prices will go down. In addition, with the release of water from the state, the cost of corporate financing will also fall. Fees like tolls for crossing roads and bridges can only be cancelled without increasing, which will greatly reduce the cost of car rental. On the contrary, the income of the common people will rise, and as such rises and falls, everyone’s purchasing power will increase.

In addition, the domestic car rental market is not very mature. For example, the industryThere are still some problems with the management method. For example, violations must be handled by the user himself. For example, a user in Beijing rents a car to play in Yunnan and violates the regulations in Yunnan. Then the user must go to Yunnan to deal with the violation. In addition to this, there are also annual vehicle inspections and some restrictions on traffic restrictions and licenses. Similar to returning vehicles from other places, Hebei ’s car will be returned to Beijing, but if it ca n’t be driven in Beijing, the car will die. These problems are all for renting a car. The company caused great trouble. The country is now undergoing changes. For example, car rental violations have been tried online in individual provinces. I believe these problems can be improved in the future.

Compared with taxi, the advantages of renting a car will gradually become more prominent in the future. For individuals, the first advantage of renting a car is having enough private space. Secondly, for long-distance travel and tourism, renting a car is the most appropriate. You can stop wherever you want to play. The degree of freedom is very high. For enterprises, the demand for car categories is even greater. In the past, many companies raised their own fleets and drivers, which is not cost-effective. At this time, long-term leasing can be considered. There are also many companies that have short-term reception needs, such as going out for meetings, employees on business trips, receiving leaders, guests, etc. At this time, car rental is often the most cost-effective option.

Of course, if you want to develop better, the first step is to live, because you can survive the cold winter and only have the spring. After the epidemic is over, everyone will travel happily.

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