Competition Strategy Research Of DZ Auto Financial Services Company

Accompanied with continuously improved economic income and living standard for average Chinese,automobile consumption,as the stabilizer of the country’s economic growth has become the key constituent of national consumption in aggregate.In 2018,with declined sales for the first time,China’s auto consumption market ended its historical growth trend for the past 28 consecutive years,and it also indicates that Chinese auto industry had gradually turned from an incremental market in early years into a stock market recently.As the development of auto finance industry is heavily dependent on the rise and fall of the auto industry.In recent years,declined profits level of the auto industry had led to a significant shrinkage of profit levels for automobile dealers,many of those dealer were silently squeezed out of the market even before they realized that their profit levels had been negatively Impacted.Automobile dealers also begun to gradually shift their focus to demanding higher financial service fees from auto finance institutions in order to maintain profitability;the ambitious attempts from jointstock banks in competing for market share have made competition within the auto finance industry more fierce,and the trend of involution has become inevitable.At the same time,consumers’ expectations towards auto finance have also changed from before,they are increasingly expecting financial products that are more competitive and innovative in general.Thus,it is clear that the construction of digital capabilities by competitors within the auto finance industry will become the key to winning consumers ultimately.So in the face of such threats and opportunities,how can DZ Auto Finance meet the challenges and set a future-oriented transformation strategy in place to secure a more stable profit source in future?In this paper,we will analyze and study the internal and external environment faced by DZ Auto Finance Company by using theoretical tools such as PEST model.Porter’s five forces model,value chain analysis,and VIRO model analysis.Through the method of SWOT analysis,based on the external opportunities and threats of DZ Auto Finance Company and combined with its internal strengths and weaknesses,it’s aimed to identify a competitive strategy which is suitable for the business development of DZ Auto Finance Company.It is clarified that,for the company’s auto finance business,differentiation strategies need to be implemented for the perspectives of products,services and partner selection,and by leveraging on value chain reconstruction,to core sales channels which are mainly consisted of dealer networks need to be continuously expanded in order to reduce sales costs and improve competitiveness within the industry.In the meantime,by combining the implementation of differentiation strategy with the company’s core values,the consumption potential of the Chinese market can be fully exploited,while its capability being strengthened and its core business being cultivated,new business growth opportunities need to be seized boldly in order to realize a sustainable growth for DZ Auto Finance’s future business which is the ultimate goal and corporate vision for the company.