The China Automobile Dealers Association has been a weak and loose organization. Its main job was to produce an annual list of China’s top 100 dealerships and to hold a few national conferences for dealers.
But it is not feckless anymore.
Over the last six months of 2014, auto sales in China slowed sharply as the nation’s economy cooled. But automakers, led by the global luxury brands, continued to burden dealers with excessive vehicle inventories.
Dealership stockpiles in China jumped to 55 days in November, significantly above the normal range of 24 to 36 days. Inventories of imported vehicles, most of which were luxury brands, rose as high as 80 days in November, according to the association.
But dealers cannot resolve the dispute over inventory with automakers through legal channels. China’s regulations allow automakers a free hand to decide the number and mix of vehicles that they can ship to dealers.