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China’s PV market in 2013: two-digit growth

China’s passenger vehicle (passenger car, SUV, MPV and microvan) sales in 2013 increased 15.71 percent on a yearly basis to nearly 18 million units, according to data released by China Association of Automobile Manufacturers (CAAM) on January 9.

The growth rate of passenger vehicle sales returned to double digits after experiencing single-digit growth rate of 5.19 percent in 2011 and 7.07 percent in 2012.

Combined sales of the top 10 passenger vehicle makers were 10.65 million units, taking up 59.4 percent of the total passenger vehicle market.

Other than economic recovery and existing fundamental demand, fear consumption in some cities such as Wuhan, Chongqing, and Chengdu that are rumored to implement vehicle registration restriction policies was a significant factor contributing to the high growth rate.

 

SUV demand remains hot

Sales of SUVs in 2013 reached almost three million units, up a staggering 49.41 percent year-on-year, or 24 percentage points higher compared with the growth rate in 2012, CAAM’s data shows.

Combined sales of the top 10 SUV models totaled 1.59 million units, taking up 53.3 percent of the total segment sales. Great Wall Haval SUVs stood out in the segment with sales of 417,400 units, making it China’s biggest SUV brand in terms of sales.

The growth rate of passenger car sales in 2013, which topped 12 million units, rose 5.62 percentage points to 11.77 percent, CAAM said.

Combined sales of the top 10 passenger car makers reached over 7.89 million units, accounting for 65.76 percent of the total sales. Shanghai-GM led the way by selling 1.37 million passenger cars with an increase of 8.13 percent, followed by FAW-Volkswagen and Shanghai-Volkswagen.

Additionally, sales of the top 10 passenger car models totaled 2.87 million units, which took up 23.91 percent of total car sales. The Chang’an-Ford Focus (including sedan and hatchback versions) remained as the best-selling car model in China.

China’s MPV sales saw a significant increase of 160 percent to 1.3 million units, according to CAAM, in contrast to a 0.87 percent decline in 2012. Combined sales of the top 10 MPV models reached nearly 1.08 million units, accounting for 82.72 percent of the total.

In comparison, microvan sales continued to decline, down by 27.98 percent to 1.62 million units. Combined sales of the top 10 microvan models were nearly 1.46 million units, accounting for over 90 percent of total sales. Eight of the 10 models saw a decline in sales.

The main reason for the sharp rise in MPV sales and drop in microvan sales is that industry associations including CAAM and China Passenger Car Association (CPCA) classified models such as the SAIC-GM-Wuling Hongguang and Chang’an Honor as MPVs rather than microvans.

According to CBU-Autostats, sales of these two models alone in 2012 were 404,994 units, accounting for nearly 18 percent of the total microvan sales that year.

Market share of Chinese brands continues to fall

Passenger vehicle sales of Chinese brands in 2013 climbed by 11.37 percent on a yearly basis to 7.22 million units, according to CAAM, but their market share dropped by 1.57 percent points to 40.28 percent.

Chinese brand market share in the passenger car segment also dropped 0.85 percentage point to 27.53 percent with sales up 8.41 percent to 3.3 million units.

Driven by hot demand of SUVs, Chinese brands sold a total of 1.04 million SUVs, up 53.8 percent, according to CBU-Autostats, but their market share was slightly down by 0.2 percentage point from that in 2012 to 37.6 percent.

In comparison, Chinese brand sales in the MPV segment totaled 1.1 million units, up 224 percent from 2012, and their market share increased 18 percentage points to 84.8 percent, according to CBU-Autostats.

Market share of Japanese brands in China’s passenger vehicle market was still down by 0.05 percentage point to 16.35 percent compared to 2012, but sales of locally produced Japanese brand passenger vehicles rose 15.2 percent to 2.93 million units.

Major Japanese brands including Nissan, Toyota and Honda operating in China ended up with positive growth for the year. Nissan sales reached 1.27 million units, up 17 percent, Toyota sales were up 9.2 percent to 917,500 units, while Honda sales were up 26.4 percent to 756,900 units.

Benefiting from the performance of Ford and its joint ventures in China, American brand sales in the passenger vehicle sector rose 22.6 percent to 2.22 million units, and their market share increased 0.7 percentage point to 12.39 percent. Ford and its JVs in China sold a total of 936,000 vehicles, up 49 percent year-on-year.

Market shares of German, Korean and French brands in the passenger vehicle segment were up 0.37, 0.15 and 0.24 percentage point in 2013, respectively.

 

PV sales forecasted to reach nearly 20 million units in 2014

CAAM predicted that China’s passenger vehicle sales in 2014 would increase 9-11 percent to 19.55-19.91 million units, driven by favorable factors including stabilizing national macro-economy, accelerating urbanization and increasing consumer demand for advanced vehicles, according to Shi Jianhua, deputy secretary-general of CAAM.

Sales of passenger cars this year would hit 12.7-12.94 million units, up 5.7-7.7 percent, according to Shi, and those of SUVs would remain high, at a rate of 28.8-31.1 percent to 3.85-3.92 million units.

“Growth in the MPV segment will slow to a range of 18.3-20.6 percent with expected sales of 1.55-1.58 million units,” said Shi, “while sales of microvans will continue to drop by about 11-19.8 percent to 1.45-1.47 million units in 2014.”

Passenger vehicle sales in 2014 are expected to be up about 10 percent, according to an earlier prediction by Xu Changming, director of Information Resource at the State Information Center, at an industry conference in November.

Xu indicated that peak demand for an advanced car from buyers wanting to replace their existing vehicles would come in 2014 or 2015, five years after the high sales growth driven by the economic stimulus polices in 2009 and 2010.

Rao Da, secretary-general of CPCA, predicted that passenger vehicle sales in 2014 would achieve a growth rate of 13 percent if the government does not implement measures such as parking fee hikes or vehicle operation restrictions for environmental protection purposes.

Chen Yue, deputy director of Acura Business Unit of Honda Motor (China) Investment Co., Ltd., predicted that passenger vehicle sales in 2014 would grow about 12 percent because of uncertainties brought by industry policies such as possible purchase restrictions in more cities.

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