Used Cars: Used Car Operations Shifting from Experience-Driven to Data-Driven

2026 marks a pivotal turning point for China's used car market. In June, used car transaction volume reached 1.6184 million units, surpassing new car retail sales for the first time, signaling that the domestic auto market has officially entered the era of stock circulation. However, behind the impressive headline data, the industry is undergoing a brutal shakeout. New car price wars and the rapid iteration of new energy vehicles continue to erode used car residual values and inventory safety, rendering the traditional experience-based business model increasingly obsolete.

Meanwhile, the implementation of new regulations on "zero-kilometer used car" exports has sparked an export boom for genuine used cars. In the first half of the year, exports reached 325,000 units with a trade value of USD 7.6 billion, with new energy used car exports surging 196% year-on-year. Markets in Africa, Central Asia, and the Middle East have opened new growth frontiers, presenting the industry with a dual landscape of "domestic consolidation + overseas opportunities."

Souche, a B2B service provider for the used car industry recently listed on NASDAQ, serves as a window into this industrial transformation. Its "Dafengche" system holds over 90% market share among used car dealer operating systems in China, with 65,334 monthly active dealers in Q2, making it an industry standard. However, Souche also faces multiple controversies: despite its vast B2B merchant base, it struggles with "high penetration, low monetization"; its stock price has been highly volatile post-IPO; and critics question its AI investment and whether it missed the new energy used car trend.

In an exclusive interview, Souche founder and CEO Yao Junhong shared his perspectives on the industry's transformation. He noted that the industry feels "sensitive" this year — in the past, when new car prices dropped, the market took two weeks to react; now, with AI accelerating information transmission, market shifts are felt instantly. This has led to pronounced industry polarization: dealers who effectively leverage data and manage inventory turnover can still profit, while those relying on old experience are highly vulnerable to inventory pitfalls amid frequent new car price cuts and rapid used car price fluctuations.

Yao emphasized that in the stock era, transaction volume does not equal industry profit; circulation efficiency is the core contradiction. Souche aims to empower merchants with data, tools, and network capabilities accumulated across the industry, enabling small and medium dealers to access judgment capabilities previously available only to large players. The "Dafengche" system first solves digital recording, but the real goal is decision support: what cars to acquire, at what price, when to adjust pricing, and where to route inventory — supplemented by B2B matchmaking, inspection, logistics, and AI tools.

On industrial AI, Yao argued that the core barrier is not the large language model itself — current general-purpose models are sufficiently intelligent. The real challenge lies in two areas: genuine industry operational data and deep embedding into real business scenarios. Many platforms only access online listing and marketing data, which inherently carries lead-generation bias, unlike the real operational data recorded in dealer ERP systems — acquisition, pricing, circulation, and transaction data. AI cannot remain a demo; it must be embedded into the full workflow of dealers' daily operations.

Regarding overseas expansion, Yao noted that after the "zero-kilometer used car" policy, used car exports have truly entered a window of opportunity. However, many exporters still operate in a "mystery box" fashion — hearing which models sell well in which country, scrambling to source goods domestically, and shipping them over, only to find market conditions have changed by the time the cargo arrives. Souche plans to follow domestic traders overseas, providing system and service support around three core functions — sourcing, buying assistance, and selling assistance — without directly participating in vehicle trade, leaving that to local practitioners.

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