China’s automobile export increased during the first five months of 2010 on the back of recovering world economy.
As the world economy is gradually recovering from the worst recession, automobile export industry of China is also showing signs of positive growth. As per the statistics released by China Association of Automobile Manufacturers (CAAM), total 190,900 vehicles were exported during January-May 2010, up 71.01% from the previous year, reported Gasgoo
According to the statistics, 25,400 Units of commercial vehicles were exported, an increase of 54.91% month-on-month and increase of 180% year-on-year. The country exported 21,700 passenger vehicles, representing a drop of 7.20% month-on-month and 45.01% year-on-year.
It’s the recovering economy overseas that helped China’s automobile export to gain momentum. China’s key export markets, including Africa and Europe, have been rebounding from the recession phase, and therefore, people have once again started purchasing automobiles.
The low cost of Chinese vehicles is another important reason that is stimulating buyers across the world to opt for these vehicles rather than the others. In China, manufacturing costs of pick-up vehicles and trucks are relatively lower because of lower labor cost. This reduces the end cost of the Chinese vehicles. Since Chinese auto market is basically oriented to the developing countries, cheap vehicles are largely popular among those who cannot afford costly vehicles.
It is noteworthy that the industry is posting continuous growth from past several years. However, there have been some challenges also. Highlighting one of such challenges, RNCOS
in its market research report “China Automobile Sector Forecast to 2012
” says that the appreciation of the Chinese currency will continue in coming years. And as the US is one of the key markets for China’s auto export, there could be negative impact on the Chinese auto exports in coming times.
According to a Research Analyst at RNCOS
, “Chinese auto manufacturers are now concentrating on low-cost production as well as technology innovation in a bid to offset the currency appreciation effects. In addition to this, the government will soon release plans to promote mergers and buyouts among different manufacturers. This effort will further propel the industry’s growth.”
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