Uxin Ltd. (Nasdaq: UXIN), China’s largest used car e-commerce platform, released its unaudited financial results for the first quarter this week, showing RMB 1 billion (USD 0.14 billion) in revenue, an increase of 54.6% year-over-year (YoY). The company’s gross profit was RMB707.5 million (USD105.1 million) , an increase of 65.6% YoY.
The growth of Uxin’s 2C (consumer-oriented) business has driven Uxin’s success, as a total of 78,277 vehicles were traded during Q1, an increase of 39.6% over the same period last year. GMV for the 2C business was RMB 8.89 billion (USD1.29 billion), an increase of 61.5% YoY.
Cross-regional transaction services have become growth areas
This is the first time that Uxin has separately disclosed relevant data on its cross-regional transaction services. According to the financial report, revenue of 2C cross-regional business was RMB284.3 million (USD42.2 million) in the first quarter of 2019, representing growth of 54 times YoY. Compared with its steadily rising 2C sales, Uxin’s cross-regional transaction services are growing by leaps and bounds.
The cross-regional transaction services have attracted more and more car dealers and consumers to trade on Uxin’s platform. A dealer from Shandong’s Weifang city said that he had sold 56 cars in 33 cities by using this service within three months. While growing rapidly, Uxin has proven the effectiveness of its B2C model, which focuses on direct sales and marketing via its e-commerce website. Through the cross-regional transaction supply chain, Uxin has made it easier for customers to find, purchase, and receive used vehicles.
What’s more, there are numerous value-added services such as logistics and insurance, which show great potential for cross-regional transaction services.
Uxin’s gross profit rates continue to rise
Thanks to Uxin’s improved trading services and user experiences, its gross profit continued to rise. According to the financial report, Uxin’s gross profit in Q1 was RMB 710 million (USD103 million), an increase of 65.6% YoY from RMB427.2 million in the same period last year.
The report also mentions that Uxin has reached agreements with 58.com, Warburg Pincus, TPG, as well as other investment institutions, on raising around USD 230 million. In the future, Uxin will further expand its digital footprint through in-depth strategic cooperation with 58.com in big data analysis and finance.
The Chinese government recently lifted restrictions on relocating used cars within the country, which bodes well for the domestic used car market. The implementation of many favorable policies, as well as the growing exports of automobiles, could unlock the potential of the used car market. Uxin plans to integrate its services with 5G technology, allowing users to inspect cars through VR and video feeds
Going forward, Uxin will continue to grow its business, refine its national purchasing strategy, and cement its leading position in China’s used car market.
(Top photo from Uxin)