Suning Auto and Taoche enter partnership
Yixin Group's second-hand vehicle split-off platform Taoche.com said it has entered a strategic partnership with Suning's automobile services unit.
Backed by Tencent and JD.com, Taoche will seek to strengthen supply chain and retail capabilities through joint efforts with Suning to better serve vehicle buyers.
The two parties will also join hands on auto financing and risk control measures.
Suning Auto aims to open 100 offline stores by the end of 2020 and Liu Donghao, president of Suning Auto, said its model fits well with Taoche's online capabilities to offer both products and services. Suning shoppers will also have access to second-hand vehicles that are verified by Taoche.
Suning and Taoche would explore further collaborations and seek further business initiatives as well.
Taoche will become an independent vendor on Suning Auto's platform and will also initiate joint offline stores on Suning's existing retail network.
Online platforms are pushing forward efforts to link car buyers, sellers, dealers and service providers. Other players like Uxin Group and Guazi.com, a car sales platform, are also competing for market share.
China’s used car market is growing rapidly but online penetration remains low and auto financing is not yet fully utilized compared to developed markets.
The China Automobile Dealers Association said total sales of second-hand cars in the first half grew 3.9 percent to 6.86 million units although new car sales have been flat, and the State Council is also encouraging vehicle sales to further boost domestic consumption.
Second-hand vehicle sales have been picking up, and competition has intensified after Chehaoduo Group received a US$1.5 billion investment from the SoftBank Vision Fund earlier this year.