China’s leading used car e-commerce platform Uxin, Ltd. (Nasdaq:UXIN) went public on NASDAQ in the U.S. on June 27, 2018. As the first Chinese used car e-commerce platform to have gone public in the US, Uxin aims to continue to be an integrated online and offline used car trading platform.
The evolution of a nationwide used car platform
Going public is a huge milestone for Uxin, as Dai Kun, the company’s chairman and CEO, remarked to a group of 200 reporters in Beijing via live video feed.
“We feel more committed than ever to keep pursuing our vision: giving people the convenience to purchase satisfactory and reliable cars,” he said.
Initially priced at 9 dollars a share, Uxin has raised USD 400 million including convertible bond. According to the prospectus, the funds will be primarily used to enhance the capacity of trading services, advance technological research and development, etc.
Founded in 2011, Uxin evolved from a B2B platform for used car trading to a comprehensive platform that now penetrates the overall used car industry chain. At present, it has been involved in a number of business sectors including used car B2B and B2C services, new car sales, motor vehicle financing, automobile logistics, after sales service, and more. Reportedly, Uxin made up more than 40% of the used e-commerce car market in 2017.
Providing trans-regional trading services for consumers is a key strength for a used car e-commerce company. According to Dai, Uxin has carried out business in more than 270 cities across China, operating more than 670 offline shops and employing tens of thousands. Therefore, consumers are able to access trans-regional transfer procedures, get after-sale services, and take advantage of one-stop financial services. Doing all of this has allowed Uxin to build up a complete supply chain of used car services.
Advances made by AI
The purchasing of used cars in China dates back to a decade ago, and the used car trading industry is currently experiencing a period of growth. China is the world’s largest car market, with nearly 29 million units sold last year. According to global research firm iResearch, China is the world’s second-largest automotive market and is forecasted to become the largest automotive market by 2023.
A surge in the used-car sector has created intense rivalry among competing brands. Uxin hired Hollywood star Leonardo DiCaprio earlier this year to endorse its brand, while top rivals Renrenche and Guazi contracted local actors Huang Bo and Sun Honglei, respectively.
Both consumers and businesses in China face significant challenges in buying and selling used cars, such as access to only a limited number of vehicles, incomplete and unreliable information about vehicles, and complex transaction processes.
The emergence of used car e-commerce companies, however, fills in the gaps. These companies address the aforementioned issues by enabling consumers and businesses to discover, evaluate, and transact used cars throughout China, providing a reliable and one-stop transaction experience.
According to Dai, artificial intelligence in the field of used car e-commerce has been primarily used across four applications. The first is the usage of AI to detect vehicle quality. With this application, Uxin has established a large automobile repair and testing database. The second advantage of AI is the ability to record and track used car trading prices. Additionally, AI technology helps to match consumers’ needs and thus allows people to discover their favorite cars. The final application is to provide financing and after-sale services.
It was reported that Uxin’s GMV (gross merchandise volume) reached RMB 11.6 billion (USD 1.75 billion) for Q1, constituting a 47.8% increase year over year. Meanwhile, its revenue grew to RMB 649 million (USD 98.1 million) for Q1 increasing by 93.2%, while its gross profit for Q1 was RMB 427 million (USD 64.5 million) and increased by 119%.
(Top photo via Flickr user bfishadow)