Expectation on Chinese automotive market 2010
Post date
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21/01/2010 12:05
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| 2009 Shanghai Auto Show attracted more than 600,000 person-time visitors. |
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Pony
Auto sales in China last year exceeded an unexpected 13 million units, enabling the country to surpass the US as the world's biggest auto market. As for 2010, several car manufactures including General Motor forecast around 10 percent sales growth in the country.
Two research organizations have recently made reports on China's passenger vehicle output, as far off as the next two decades.
"Car Study China", released by the European consultancy Malik Management, predicts that auto sales growth in China will decrease to 10 percent or so in the next 10 years. From 2025 onwards the market will have low rates of growth, reaching saturation point with a total of 300 million vehicles by 2030, roughly 200 of every 1,000 people.
"China Passenger Vehicles," published by the investment bank UBS Securities, says China's GDP will grow at an average annual rate of 6 to 8 percent over the coming 20 years. The report doesn't give a date for saturation, but UBS forecasts more than 150 vehicles per 1,000 people own cars sequentially to 222 million units on Chinaˇs roads by 2030.
This is much lower than the car ownership level of 600 to 700 per 1,000 people in traditional auto markets like Europe and the US today.
According to UBSˇ report, the ownership rate in Beijing is now around 150 units per 1,000.
In addition, they both express opinions through reports that government stimulus policies can only boost market demand in the short term. The Malik report shows the only impact of these policies is to shift short term demand between time periods. ¨The final number of cars owned wonˇt be affected,〃 the report says.
Two main factors contribute to robust auto sales. The series of stimulus policies introduced so that suppressed demand especially for small-displacement vehicles are released. The purchasing power of consumers next year is also prepaid. As a result, sales of China auto market in 2010 are forecasted to experience a year-on-year decrease.
Prediction models presented in each report consider a wide array of influences affecting car demand in China, such as economic growth and government policies. However, in some insidersˇ opinions, the impact of new technology on development of China automobile market over the next 20 years should be paid more attention.
Many successful breakthroughs are likely to occur during the period. Take electric cars for example, they could become affordable to the mass of consumers as soon as a crucial breakthrough in battery technology is achieved.
In that case, millions of Chinese people riding electric bicycles could drive electric vehicles instead, when car ownership would soar to unimaginable level.
Source: Adsale CMJ Machine-Building Online
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