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Recently, Dong Yang, executive vice president and secretary general of the China Association of Automobile Manufacturers, gave an estimate of the future trend of the auto market in an interview with the media. In Dong Yang's view, the Chinese auto market will continue to grow steadily in the next 5-10 years, with an increase of 8%-10%, and even higher is within expectations.
In 2013, the auto market experienced a "warm winter." Many experts early this year are predicting the “micro-growth†and “rational growth†of the auto market. At the end of the year, the Chinese auto market will hand over a beautiful report card and stage a dramatic counterattack.
In 2014, can the auto market create a “dark horse†myth? The auto market will still maintain a growth rate of about 15%. The reasons are mainly the following major positive factors.
Good Factor 1: Urbanization Accelerates the Release of the Potential of Third and Fourth-tier Cities <br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br> As market capacity of first-tier cities gradually becomes saturated, traffic congestion becomes increasingly fierce, and restrictions on line purchases are becoming a trend, this policy orientation will undoubtedly bring new opportunities for the development of the automotive industry.
In 2013, the China Association of Automobile Manufacturers and Nielsen jointly released the White Paper on China's Auto Consumption in Blue Ocean Market Insights. In the coming year, consumers in third and fourth tier cities will account for 68% of new car purchases. It is foreseeable that the purchasing potential of the next three or four tier cities will be quickly released, which will in turn drive the growth of the auto market.
In the first half of 2013, the all-new Audi A3 produced by the FAW-Volkswagen Foshan plant will be officially launched, and the selling price will be around 220000 yuan. Prior to this, the BMW 1 Series and Mercedes-Benz A-Class have entered the price range of 300,000 or less. These signs indicate that the miniaturization of luxury cars is gradually becoming the latest trend in the auto market. More low-emission, low-cost new models will become the norm in the future luxury car market.
Good Factor 2: The SUV market continues to heat up
With the advancement of lightweighting and engine energy-saving technologies, SUVs in the Chinese market have been blowout in the past two years. In 2014, as more miniaturized SUVs aiming at young car buyers are added to the market and the number of buy-in and upgrade groups increases, the SUV market will continue to increase.
According to the latest statistics from the China Association of Automobile Manufacturers, in November 2013, the production and sales of SUV models were 316,600 units and 301,300 units, an increase of 76.64% and 59.24% year-on-year. In the miniaturized SUV market, joint venture brands will include Chevrolet Trax, Peugeot 2008, Beijing Hyundai ix25 and other new models in the war in 2014.
Good factor 3: Electric car or usher in spring
Frequent haze and traffic congestion have pushed the car to the cusp of the city’s overall disease. Recently, the BMW i3 was officially launched in Hong Kong, China, and it will land in mainland China in 2013. Mercedes-Benz's Smart electric vehicles and Volkswagen's golf electric vehicles will also enter China in 2013; while Toyota, Nissan and Honda, the US Department of General Motors Ford will flex its muscles in new energy vehicles. In terms of policy, on November 26, 2013, the four ministries and commissions officially approved the establishment of the first batch of new energy vehicle demonstration cities (clusters) in 23 cities and 5 provinces. The total number of demonstration cities is 61, and the total number of demonstration vehicles is as of the end of 2015. It reached 300,000 vehicles.
Good factor 4: panic buying under restrictions
In December 2013, with the announcement of restrictions on purchases in Tianjin, other cities have continued to report news that the pace of purchases is accelerating. As a result, the auto market has experienced “panic buying†of consumer volatility.
In the future, restrictions on purchases will become more and more “suddenâ€, and each city’s restrictions on purchases will drive the tide of chain buying in other cities. This “irrational†buying will also be a potential growth point for the 2014 auto market.