The increase in demand of passenger car has enhanced car sales figure in China. This has affected the economy significantly and a further demand is still predicted in the time yet to come.
Passenger car sales in China had shown a phenomenal growth of 21.2% in October than the same period last year and domestic cars touched a never before record of 496,900 units for the month, reported China Knowledge.
As per China Association of Automobile Manufacturers (CAAM), as many as 364,600 sedans were sold, a 20% growth while there was a snap up of 30,900 SUVs. MPVs also grew in popularity, selling 17,800 units. Overall car sales in China grew by 24% for the initial ten months, reaching 7.15 Million units. To keep pace with the strong demand, manufacturing during January to October had risen by 21.7% to 5.14 Million units, with 713,100 passenger vehicles manufactured in October 2007.
Healthy economy of China and migration of people from smaller places to larger cities where a car is needed allows car manufacturers to predict an increase in demand for their product. Sustained depression in the price along with continuous increase in the availability of new, cheaper and smaller cars is also allowing the number of consumers to increase.
Strong economic position since 1990s led to the expectation of growth in passenger car segment. However, the rate at which the car industry has grown would not be so if it were not for the potential that the Chinese market has. Moreover, China’s access to the WTO in 2001 proved a crucial turning point for its automobile industry.
The government of China has also encouraged banks to provide easy car loans and reduce taxes by permitting private car duties to be determined by public tenders.
Industry experts are of the view that passenger car companies have been at the zenith of industrial development during January-October 2007 and they had attained performance at a rather high level. Currently, the passenger car industry mainly depends on private utilization and new vehicle procure, opening the gates of a fast growing era.
As per the report “China Automobile Industry Forecast (2006-2010)” published by RNCOS automobile industry of China is evolving as a key player in the global automobile landscape from the viewpoint of demand as well as supply. In future, fuel efficiency standards’ introduction is going to promote the sales of small cars. Also, the Beijing Olympics in 2008 would require investments in the logistics area that would improve the sales of commercial vehicles in the country.
Related Market Research Reports:
Asian Automotive Industry Outlook (2007-2011)
China Automobile Industry Forecast (2006-2010)
Vietnam Automobile Industry Forecast (2007-2010)
