Auto repair point of view: auto repair prices should also drop
The maintenance and repair of vehicles has become a crucial revenue stream for car manufacturers. According to digital data, a typical car is driven for about 11 to 12 years, and the total cost of maintenance during that time can be equivalent to the original price of the vehicle. With such a massive profit margin, it's no surprise that automakers prefer to slash the price of new cars by thousands of dollars rather than lower the prices of spare parts that may only cost a few tens or hundreds of yuan.
While significant price cuts on new models are aimed at capturing market share, keeping part prices high helps maintain overall profitability. For large companies like Volkswagen, where the market is vast, reducing spare part prices is far more challenging than lowering the cost of new vehicles. Many large corporations face similar difficulties as consumers — they’re caught in a cycle where they must balance competitiveness with profit margins.
This situation has given rise to smart small and medium-sized enterprises (SMEs) who have found their own ways to thrive. Rather than passively following the market in lowering prices, these SMEs focus on turning after-sales services into a profitable segment. They understand that competing directly with big companies on price is not always feasible, especially when those giants have the power to drown out smaller voices through aggressive marketing and brand influence.
However, when larger competitors start cutting car prices, SMEs often have no choice but to follow suit by adjusting their own accessory prices. This move can have a much stronger impact, especially if done strategically. Recently, Dadi Motors introduced a "3xN" service offering, promising a 13% reduction in maintenance costs and lower pricing on spare parts. Such actions make consumers feel the benefits more directly — a 13% discount is visible, and price reductions on parts are tangible and practical.
For SMEs looking to compete, this could be an opportunity to align with the trend of price cuts in the spare parts market, which has been pushed by major players. Some smaller companies have already started reducing after-sales service costs, causing concern among larger firms. These big companies realize that even though they promote “big service cards,†their efforts often seem like a short-lived storm compared to the real changes made by others.
Source: Beijing Entertainment News
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