On July 4, 2022, Chen Menghe, leader of the Chongqing City Commerce Commission, and Tang Wenhua of the Chongqing City Used Car Circulation Association visited Huanyu Automobile to accept the construction of a used car integrity management demonstration base.

Chen Menghe (third from right) of the Consumption Promotion Department of the Municipal Commerce Commission and Tang Wenhua (second from right) of the Municipal Used Car Circulation Association accepted the construction of Huanyu's integrity system.

    Chen Menghe listened to the introduction of Huanyu Chairman Fu Yueming and inspected the implementation of various integrity construction contents of Huanyu Automobile.

Fu Yueming introduced the construction of integrity

    Construction of integrity management system

     Huanyu Automobile's achievements in building an honest management system for used cars have been recognized by the leaders, and hopes that in the future development, it will continue to adhere to the exploration and attempt of honest management of used cars.

     Since 2015, under the guidance of the competent department of Chongqing City Commerce Commission, Huanyu Automobile has launched the construction of an integrity system for the used car industry in Chongqing City in accordance with the work steps of "focusing on reality, setting standards, benefiting integrity, establishing models, and spreading publicity." In accordance with the work deployment, we will solve the long-standing industry pain points through point-to-point advancement: asymmetric information on used car products and opaque prices. Taking information disclosure as the starting point and product guarantee as the backing, we will lead the transformation and upgrading of the industry. By infiltrating the concept of integrity, integrity culture, integrity connotation, and integrity behavior into all aspects of used car trading services, honest behavior has become the business philosophy, code of conduct, and conscious pursuit of pilot companies.

On June 19, 2015, the integrity pilot was officially launched

1. Background

     After years of development, especially in recent years, the used car industry has grown rapidly and has become an important part of the entire automobile circulation industry. However, the industry has extensive development methods, low barriers to entry, lagging policies and regulations, irregular business practices, disorderly competition, asymmetric product information, distrust of consumers, difficulty in supervision by competent authorities, and urgent need for innovation in the industry. The stubborn diseases of the industry are difficult to get rid of. Money-making merchants are not honest, and honest merchants do not make money. It is a deformed industry in which bad money drives out good money.

     To solve the pain points of the industry, as far as the regional market is concerned, it is difficult to achieve regulation and management by relying solely on a small number of merchants or the used car market. It is necessary to provide positive guidance from the competent government departments to strengthen industry supervision, strengthen self-discipline of industry associations, and carry out extensive publicity, set industry benchmarks, and give consumers confidence in used car products.

Through rigorous thinking, the competent department of the Municipal Commerce Commission fully visited and investigated the market, convened interviews and communications with companies of a certain scale in the industry, and diagnosed the current situation of the industry. It believed that improving the honest trading system is the key to the development of the used car industry, and advocated that operating companies actively participate in the joint promotion Promote the transformation and upgrading of the used car industry in Chongqing City.

2. System construction

      The construction of a used car integrity system is a brand new research topic. Although other provinces and cities have also initiated integrity alliances, integrity conventions, etc. in the past, there are no specific procedures or specifications, and the implementation is not easy to implement. They are based on self-understanding and use behavioral self-discipline as the fulcrum of integrity. In the end, nothing happened.

After full preparations, the Municipal Commerce Commission guided Huanyu Automobile and several other companies to jointly build an all-round honest management system for used cars in Chongqing City, and the work was advanced layer by layer.

     (I) Extensive investigation: Firstly, the Investigation on Management Problems of Second-hand Car Market in Chongqing City initiated by Huanyu Automobile was initiated by the Commerce Committee, which clarified that the integrity management system of second-hand cars in Chongqing City needs to make efforts in information disclosure, product standardization, price transparency, service guarantee and other aspects, and also set a pragmatic tone for the pilot project of integrity management of second-hand cars.

    (2) Strict standards: After the project was launched, the competent department of the Commerce Commission strictly controlled the formulation of the "Work Manual for the Integrity Management of Used Cars in Chongqing City"(hereinafter referred to as the "Manual"), and revised and improved the contents of the Manual and related annexes, agreements, and contracts many times to ensure that the "Manual" truly plays a guiding role in the healthy development of the used car industry and ensure its objectivity and operability.

    (3) Strict acceptance: Since the Chongqing City Commerce Commission and the Chongqing City Used Car Circulation Association officially launched the "Chongqing City Used Car Integrity Management Pilot Unit" project, the first batch was piloted by three companies: Huanyu, Zhaohua and Jiecheng. In the subsequent stage of the pilot work, the inspection team organized by the Commerce Commission and the Association conducted regular or irregular monthly inspections of the operating process of the pilot units, and strictly reviewed and accepted according to the "Acceptance Scoring Table for the Integrity Management of Used Cars in Chongqing City Pilot Project", allowing no slack to be allowed to ensure the standardization and rigor of the operation of the project.

    (4) Continuous promotion: The competent department of Chongqing City Commerce Commission has maintained a high degree of continuous attention to the project. The number of pilot units has grown from the initial three to 15. During the inspection, two pilot enterprises were banned due to substandard business specifications. At the same time, it has also set off a wave of integrity in Chongqing's second-hand car industry. Many second-hand car companies have imitated and learned."Certification style" and "Integrity style" have quietly prevailed in the second-hand car market.

3. Advance pilot work

     The work of building integrity is to cross the river by feeling the stones and solve the pain points of consumers: asymmetric information on used car products, opaque prices, and insecure after-sales services, eliminating consumer concerns. With the continuous advancement of the pilot work, Huanyu has also been rated as "Chongqing City Used Car Integrity Management Demonstration Base" by the Used Car Circulation Association. Its business behavior has also been continuously innovated with the deepening of the pilot work, giving new ideas to used car products.

 Used car integrity management demonstration base defines new standards for integrity

   (1) Product standardization: Used car products often have the saying in the industry that "one car, one condition, one car, one price". Standardizing products is a very challenging task. By combining the guidance of the "Manual", Huanyu Automobile has standardized its own products, established admission standards, preparation standards, and beauty standards, and formulated testing standards in conjunction with third-party appraisal and evaluation agencies. Among them, the product standard of "6 years, within 120,000 kilometers" is adhered to for the products sold in the exhibition hall. Any product that does not meet this regulation cannot be sold in the exhibition hall. At the same time, we must resolutely say no to burning vehicles, flooded vehicles, and accident vehicles under the definition of testing standards. Bringing quality products to consumers is one of Huanyu Automobile's self-pursued goals.

    (2) Transparency of vehicle condition: For products that meet the requirements for sale in the company's exhibition hall, Huanyu Automobile conducts comprehensive vehicle condition testing on the products through a third-party appraisal and evaluation agency, informs consumers of the real vehicle condition, and provides the vehicle condition testing report as an attachment to the contract. Hand over to consumers, and treat every Huanyu car buyer with a responsible attitude towards the product. This behavior effectively solves the phenomenon of inconsistent product information between consumers and merchants, replacing inferior products with good ones, concealing major vehicle conditions and not reporting, allowing consumers and companies to conduct transactions on the same fair, open and impartial platform.

    (3) Clear price: While Huanyu is making product standardization efforts, it has also raised the previous clear price to a one-stop price. Guide used car customers to change from price orientation to product value orientation. Most used car consumers put a lot of energy into price negotiation, resulting in a low customer experience. Huanyu uses a scientific pricing method to directly set the price to the end, allowing customers to pay more attention to the product itself and value services. It has achieved a good reputation and further enhanced its brand power.

    (4) Optimize services: In order to better provide customers with a car purchase experience, Huanyu has set up a customer service department, from the time customers enter the exhibition hall, to the consumption process, to tracking the car picking up, holiday greetings and door-to-door visits with gifts. A series of comprehensive upgrades such as consumer return visits. For example, in order to solve the problem of inconvenient dining for customers at noon, while providing guest meals, the tableware has been upgraded twice this year to ensure cleanliness and hygiene while allowing customers to eat with peace of mind and comfort.

    (5) Car guarantee: When selecting a car, Huanyu's integrity standard has been upgraded from the initial 3 days to 7 days without any reason. Now it has been upgraded to try first and buy later. Trial is free. Give customers a sufficient buffer period and also familiarize themselves with the product situation. At the same time, it also insists on 7 days of return without reason, 90 days of conditional return and product warranty within 1 year or 20,000 kilometers. Break the unspoken rule of the used car industry: no matter what products go out. Let used car products enjoy the same guarantee of quality and service as new cars.

Create a standardized system for integrity demonstration bases

4. Results achieved

     Through the construction of integrity management, the integrity pilot work will be truly implemented and good social and economic effects will be achieved.

   (1) Industry honors: The company has successively won honors such as "The Most Influential Brand in China's Used Car Industry","Top 100 National Used Car Enterprises","Outstanding Contribution Award in the Used Car Circulation Industry","Assured Used Car Enterprise","Integrity Enterprise in the Used Car Circulation Industry","Famous Trademark" in Chongqing City, and "Famous Trademark" in Banan District.

   (2) Customer trust: With the positive guidance and public opinion publicity from government departments, the number of customers who come to Huanyu to watch cars has increased significantly. Many customers come to the store for consultation with the integrity pilot unit, and the transaction is completed successfully. Huanyu's customer conversion rate is higher than before. Significantly increased.

    (3) Brand power is reflected. Through branding, the quality of Huanyu's products has been recognized by customers. Most customers believe that it is cost-effective to pay more for products such as used cars to gain quality and quality guarantees. Therefore, Huanyu's brand has sold quality and sold at a premium.

    (4) Improved services, customers 'car purchase experience has been significantly improved. They no longer struggle with price negotiations but return to the product itself. The company's business focus has also been upgraded from price negotiation to customer service, providing customers with better services and continuously improving customer satisfaction.

    (5) Information transparency. Combined with the authoritative third-party certification report, Huanyu informs customers of the product status without reservation, so that customers can understand the products they purchase, reduce complaints about the products to almost zero, and at the same time, the requirements for returning and replacing cars are also significantly reduced., the viscosity between customers and Huanyu has been greatly enhanced.

5. Industry demonstration role

    (1) The number of second-hand car circulation companies participating in the demonstration of integrity has increased significantly. From the initial three pilot companies to 2021, 60 companies have passed the recognition of the integrity management standards of second-hand cars.

    (2) Honest management has become the mainstream of the used car industry in Chongqing City. Although some companies cannot meet the full content of the code for honest management of used cars, they have independently begun to follow up on the behavior of honest management. Transparency in vehicle conditions is the future development trend, and open, fair and fair used car transactions are the future development direction.

    (3) The integrity construction of used cars has deeply affected the operation and management of the Kaien used car market. Second-hand cars in the Kaien Market have been fully inspected when entering the market. Accident cars, flooded cars, and burned cars have been made public, laying the first hurdle for consumers to clearly understand their consumption!

    (4) Fraud in the industry, complaints have been significantly reduced, and customers 'satisfaction with the trust in used cars has increased significantly. The vast majority of used car companies have adopted three-party testing reports. Most large-scale car companies have quality guarantees, and some car dealers have begun to develop brands and standards. Most operators are willing to build brands and integrity. The Chongqing City Commission of Commerce is promoting the "Chongqing City Used Car Integrity Management Pilot Construction" to cultivate a small number of benchmark, model, and typical honest transaction demonstration enterprises. Using points and areas to achieve the goal of promoting standardization, management upgrading, and orderly competition in Chongqing's used car industry, which has been quite effective.